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To ask the Minister for Communications, Energy and Natural Resources his views on the production of ethanol for use as an alternative fuel and energy source; and if he will make a statement on the matter. – David Stanton.

For ORAL answer on Tuesday, 10th February, 2009.

Ref No: 4590/09 Lottery: 40 Proof: 103


Minister for Communications, Energy and Natural Resources (Mr. E. Ryan)

Sustainable biofuels will play an important part in delivering the 10% renewable energy target for transport fuels by 2020.

The Biofuels Mineral Oil Tax Relief Schemes have resulted in 18 projects being awarded excise relief between 2005 and 2010 with four of these projects in the bioethanol category. The schemes were designed as interim measures to accelerate the level of biofuels in the fuel mix, in advance of the introduction of a biofuels obligation. Biofuels are already being mainstreamed in blends of up to 5% at a number of existing petrol and diesel pumps, and higher blends are being sold to identified vehicle fleets. Given the fact that bioethanol is the generally approved replacement for petrol, it has a valuable role to play in national bioenergy policy.

The information sought by the Deputy in relation to imported biofuels is not available. The Office of the Revenue Commissioners advises that the total cost of these excise relief schemes to date is estimated at €40m. I am committed to the development of an Irish biofuels industry and to the sustainable development and deployment of indigenous bioenergy resources.

In relation to licensing of biofuel companies, I have no function on this matter. Consents for the construction of a Biofuel production facility would obviously be required from a number of sources, such as the local authority and possibly the Environmental Protection Agency (depending on the feedstock), while in due course, compliance with the EU Sustainability Criteria will become a condition of biofuels being counted towards EU targets.

The planned introduction of a Biofuels Obligation will require all fuel suppliers to ensure that biofuels represent a certain percentage of their annual fuel sales. The biofuels obligation is designed to provide a long-term market based framework for the development of a biofuels sector and delivery of biofuels targets to 2020.

The public consultation process in relation to the Biofuels Obligation Scheme has recently been completed and there were 40 submissions received as part of the consultation process. My Department is now analysing the submissions with a view to preparing specific details for a final Biofuels Obligation Scheme which will be cognisant of the views expressed by stakeholders. I will bring a proposal to Government soon and introduce the necessary legislation required in order that the Biofuels Obligation Scheme can be introduced in January 2010.

Through the full application of the EU sustainability criteria, the Biofuels Obligation Scheme mechanism will allow us to ensure that the biofuel we use is sustainably sourced, and evolving technologies will allow us to increase the penetration rate without any impacts on food prices. Given that biofuels will form an increasingly important component of European transport fuels in the coming years, it is vital that these criteria are not alone robust and effective in protecting those most at risk in the developing world, but that they also set the agenda for further investment in more efficient biofuel production, and for investment in second generation biofuels.

Through appropriate RD&D schemes such as the Charles Parsons awards, we are incentivising the development of second generation biofuels, which will not use food stocks as raw material input. Work is currently underway to determine what the marine environment might contribute to developing the national biofuels capacity. The analysis will include identifying the necessary research, development and demonstration projects to realise any such potential. Sustainable Energy Ireland (SEI) is commissioning analysis of the potential of marine algae as a source of biofuels for Ireland and my Department is also supporting the Interreg project “Biomara”, which will be examining all potential opportunities for biofuel production from marine sources. This work will provide a comprehensive basis on which to inform research and development work on the potential use of marine algae for renewable energy. It will also provide data in relation to the biofuels capacity that could potentially be derived from the marine environment.


To ask the Minister for Communications, Energy and Natural Resources the efforts he is making to increase competition in the energy market; and if he will make a statement on the matter. – David Stanton.

* For WRITTEN answer on Tuesday, 10th February, 2009. Ref No: 4591/09


Minister for Communications, Energy and Natural Resources (Mr. E. Ryan)

The introduction of the all-island Single Electricity Market (SEM) in November 2007 marked an important milestone in the development of competition in the Irish electricity sector. This market has already attracted new entrants to the Irish electricity generation market.

Our ambitious renewable generation targets will also attract new generators to the Irish market. However, the all island market is relatively small and accordingly only a certain level of generation capacity can be adequately accommodated.

This is mirrored by developments in the retail electricity market. Airtricity has decided to offer a new tariff to domestic electricity users to compete with ESB and I understand that other companies are currently considering entering sections of the market. This progress represents the dawning of real choice for electricity consumers, which will help to keep energy costs competitive.

The Government will continue to promote the development of competition as a cornerstone of our energy policy. We will ensure the completion of the reduction of ESB’s market share in line with the CER-ESB Asset Strategy Agreement, the completion of the transfer of the Transmission System Assets from ESB to EirGrid, the successful development of the East West Interconnector by 2012 and the implementation of the grid development strategy set out in EirGrid’s Grid 25 programme.

On a European level, the Government will continue to implement reform of the electricity and gas markets in line with EU Internal Energy Market Directives.