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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Energy policy and offshore development

Summary

Michael McNamara questions the gap between the Government’s energy ambitions and the pace of delivery, citing exploration policy, biomethane support and offshore wind investment. The Taoiseach says the exploration ban followed prior committee recommendations, insists projects must proceed in an orderly way, and concedes the pace must increase before the end of the decade.

I want to discuss the growing disconnect between the Government's stated aspirations on energy and the reality on the ground. This week, the Government is asking the Dáil to vote for the provision of emergency generators that will run on liquefied petroleum gas, LPG, and, crucially, will also have the capacity to run on green hydrogen, if and when it becomes available. One of the Government's first acts was to announce an exploration ban on the extraction of oil or gas in Irish waters. I am told there are people in the energy sector who wish to explore for gas, particularly off the west coast, where there is infrastructure. The crucial difference between the gas coming in from the west of Ireland and LPG is that the carbon footprint of LPG is far higher because not alone do we burn it, there is also the energy used to transport it here. The Taoiseach could not have predicted the energy crisis when the Government announced the ban on exploration. Will he revisit it in light of what we know now?

One of the rationales posited for the ban at the time was that by keeping fossil fuels in the ground, we will incentivise the use of sustainable alternatives, but that did not happen. The European Commission has said Ireland and Denmark are the two countries most suitable for the production of biomethane. Denmark now meets one quarter of its gas needs by way of biomethane and it is saying it will meet 100% of its needs in this way by 2034. We do not produce any biomethane of any significance. An EU scheme was announced whereby billions of euro were made available for countries to develop their biomethane sectors to meet the energy crisis. When I asked the Taoiseach about this before, he said I would get a direct reply from the Minister. Only after I asked the latter about it did I find out we did not even apply for that scheme. Italy is getting almost €5 billion to develop its biomethane sector.

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It is getting loans.

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It is money that can be used to provide an alternative to carbon, which is the Government's stated intention. However, what is happening on the ground is that there are farmers' groups across the country that are willing to develop the biomethane sector. They are begging for support. There was an opportunity to get it from the European Commission and the Government did not avail of it. We are told that wind, particularly offshore wind, is the answer. Ireland is the country in Europe that is most suitable for producing wind energy. At the moment, we produce 24 MW of offshore energy. Scotland, by comparison, produces 1.9 GW - or 1,900 MW - and is hoping to increase that to 11 GW by 2030. We have recently upped our 2030 target from 5 GW to 7 GW. Any international investor is going to look at our track record to date in determining whether to invest. Our track record does not match our rhetoric.

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I stand open to correction, but the ban on exploration came about as a result of a recommendation from an Oireachtas committee of the previous Dáil.

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It was the Tánaiste.

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It was the Tánaiste in 2019.

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The previous Oireachtas committee on climate decided, by majority vote if I am correct, that we would ban oil and gas exploration. Why? Because we wanted to reduce our dependency on fossil fuels. Why? Because we wanted to deal with the issue of climate change, because climate change is existential and we have to start. The danger was that if we kept on doing oil and gas exploration, we would reduce any incentives to move towards renewables. That has been the challenge. No one saw the war in Ukraine coming and the degree to which Europe would have to reduce, very rapidly, its dependence on Russian gas and oil, with countries scrambling all over looking for liquefied natural gas across the board.

We import the majority of our gas from the UK, which also take supplies from Norway. Some 75% of our gas comes from the UK and 25% comes from Corrib. We have developed well in terms of onshore wind. We are now on the cusp of a significant development in the context of offshore wind. Consents have been activated in respect of the east coast. Auctions will take place, and we will see the first phase of a significant offshore wind energy project getting under way. That has been assisted by the fact that the legislation around maritime permits and so on was brought through the House last year. The Maritime Area Regulatory Authority, MARA, has been legislated for, and advertisements for positions in MARA are now under way. It is envisaged that MARA will be established early next year. There is a genuine desire, which the Deputy articulated, to move faster in respect of this. The Minister for the Environment, Climate and Communications, Deputy Eamon Ryan, is of that view also. The EU is of the view that we need to fast-track the permit system. It is introducing a regulation that will provide for an overwhelming public interest clause. The latter will override other objections to offshore wind in the interest of the public good in order to get as much offshore wind energy in place so as to permanently reduce and eliminate our dependence on fossil fuels. All of that is accelerating across Europe because of the war in Ukraine. People want to reduce, very quickly, their dependence on Russian gas and oil.

Recent developments have been extraordinary. Russian gas accounts for something close to 10% of requirements compared with what the position was at the beginning of the year. It has been an extraordinary achievement by the EU. Gas storage is at 80% or 90% across Europe. This just shows what can be done out of necessity. That is the agenda ahead of us in terms of our security of supply.

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The reality is that people who want to invest in the biomethane sector in Europe are not coming to Ireland to invest. They are going elsewhere, because we do not have the structures within which they can invest. We did not even apply to the EU for that money. The reality is that Moneypoint is gearing up production at a time when we are saying that we are bringing in green energy, that we are going to create green hydrogen and that we will bring offshore energy ashore at Moneypoint. That reality is further away than ever because the investors who were bringing both the money and the technology to bear on this matter are walking away from Ireland shaking their heads.

Those investors are going to Scotland. I do not know why they are moving away but I am told they are doing so because of Ireland's inability to put frameworks in place to allow them to invest money. They are going to Scotland instead. We are producing 24 MW of offshore energy while Scotland is producing 1,900 MW.

The Taoiseach is correct that consents are only now being given out for phase 1. Phase 2 will be the stage when floating energy will be able to develop green hydrogen that might some day fuel emergency generators. People need to know now whether power-to-X will be included. We have data centres that can take power directly from offshore generation if they are allowed to do so. Will they be allowed to do so? What will be the relevant criteria?

We are hopelessly behind. We will not attract international investment without certainty.

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The Minister for the Environment, Climate and Communications, Deputy Ryan, with the Commission for Regulation of Utilities, EirGrid and the Department, form a board to try to accelerate the offshore wind initiative. The desire of the State is to do this in a controlled and organised way, not in a wild west sort of way. It is a natural resource. It is a national resource that belongs to the Irish people. This must be done in a programmed way.

Many investors are in a hurry, and I understand that fully. I know what is happening in Scotland, which is moving at pace. We acknowledge-----

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Scotland is moving at a greater pace than we are.

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-----that we need to up our pace and speed up the rate at which we can get these projects in place, certainly before the end of the decade. We have already increased our target in respect of offshore wind, hydrogen and so on for the end of the decade. Be in no doubt of the Government's commitment in respect of the funding. I think the Deputy is talking about loan facilities. Given the interest rates at which we were borrowing, if that is the same scheme, we did not need to borrow from the European Union facility when we could borrow at a cheaper rate ourselves. In some instances, we do not need to borrow, given the surpluses we have had.

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Would it be fair to say that turtles think they move at pace?

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Sorry?

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Would it be fair to say that turtles think they move at pace?

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They get to their destination.

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