Renewables

Renewable Energy Plan

The 2001 European Renewable Energy from Electricity (RES-E) Directive required a target of 40 per cent renewable generation by 2020. Measures were taken for wind energy projects.

Ireland’s Renewable Energy Action Plan  2010  under the EU Directive required  16 per cent of energy from renewable sources by 2020. The National Strategy required  40 per cent of electricity, 10 per cent of transport and 12 per cent of heating fuels from renewable sources by 2020.

Productions are expected by the use of the following

• wind projects
• microgeneration,
• offshore wind,
• biomass,
• landfill gas,
• anaerobic digestion plants,
• geothermal,
• ocean energy and
• hydro projects.

REFIT

The renewable energy feed-in tariff (REFIT) is used to promote electricity generation from renewable resources technologies. The REFIT 2006 scheme encourages electricity generation from biomass, hydro and wind and a guaranteed minimum price is paid to a generator by a supplier of renewable energy.

A qualifying generator may enter into a power purchase agreement with a power supplier allowing the generator to receive a stable income, while the supplier is entitled to REFIT supplier payments. These include a payment for every kilowatt-hour contracted under a power purchase agreement to compensate the suppliers for the cost of balancing undispatchable energy.

In some instances a premium payment is given dependent on the renewable technology under the relevant power purchase agreement, and suppliers is compensated if the market price goes below a certain level, s guaranteeing them a minimum price for energy supplied. This facilitates financing investments in wind power. Support under REFIT 2006 is for a maximum of 15 years and cannot extend beyond December 31, 2025.

After that, the energy price REFIT 2006 projects are to be set by the market. The Department of Energy is responsible under Directive 2009/28 for obtaining exemptions from the European Commission from State aid rules.

During its first year, 98 per cent of the REFIT 2006 feed-in tariff support was allocated to wind farms. The incentives for wind farms have been very successful in attracting development and investment in onshore wind farms. In 2008, REFIT was amended to support offshore wind.

Power to set PSO

The Minister, following consultation with the Minister for the Environment, may make an order directing the Commission to apply public service obligations on the Board or other holder of an authorisation or licence holder. They may relate to the security of supply quality, price regularity, environmental protection, and use of indigenous energy sources.

The costs of public service obligations may be recovered from all users. The cost of maintaining providing and maintaining supply to remote areas is to be shared equally.

The Minister may, by order, subject to the consent of the European Commission, provide for recovery from consumers of costs and revenue relating to generating stations constructed or under construction prior to liberalisation for which the ESB may be unable to recover costs due to implementation of the liberalisation directive. Such transitional levy was to be for five years.

EirGrid Market Operator

EirGrid, which is the transmission system and market operator of the wholesale electricity market, is responsible for providing transmission and marketing services for electricity consumers. It has published Transmission and Distribution Incentives.

EirGrid has proposed GRID 25 under which €4 billion is to be invested to develop and upgrade the national transmission system and connect the Irish grid to the UK and eventually the European Grid by 2025.. The capital needed for Grid 25 is to be raised from a Transmission User Operating System, which levies charges on all electricity generators.

It was proposed to expand the feed-in tariff scheme to facilitate delivery of co-firing in peat stations of 30 per cent and encourage waste-to-energy projects by supporting hybrid projects. Using 24 per cent wood biomass at three-peat electricity generating stations was envisaged.

PSO Levy I

REFIT is financed by a levy on final purchasers of electricity, which is administered in accordance with the requirement of the Electricity Regulation Act 1999 (Public Service Obligation) Order 2002. The 2009 and 2010 Orders extended the number of projects in the REFIT scheme for which a public service obligation (PSO) is levied on relevant off-takers and thus supports the construction of new renewable energy plants.

It empowers the CER to include the additional costs from  REFIT projects in its calculations of the PSO levy and provides the legal basis for the collection of a levy payment from final customers and the onward payment by EirGrid of the levy to suppliers under REFIT PPAs.

Under the older schemes, the Electricity Supply Board was also subject to public service obligations, including obligations to purchase the output of certain peat and renewable, sustainable or alternative electricity generating stations at fixed prices in the interests of security of supply and environmental protection. The last of these obligations ended in December 2019. The ESB was also compensated for doing this from some of the proceeds of the PSO levy.

The Electricity Regulation Act 1999 (Public Service Obligation) Order 2002, as amended, provides for a PSO levy from final customers of electricity to meet the additional costs incurred by the ESB, as well as REFIT supplier, in meeting their public service obligation.  It provides the legal basis for payment to suppliers of the REFIT supplier payments outlined above.

PSO Levy II

The Electricity Regulation Act 1999 (Public Service Obligations) (Amendment) Order 2004 provided for a new levy and amended level mechanism.

Electricity Regulation Act 1999 (Public Service Obligations) (Amendment) Order 2014 is charged pursuant to the CER (CRU after the 2016 Act) scheme to all electricity customers. Various subsidy schemes support policies in relation to renewable energy indigenous fuels and security of supply.

The levy contributes towards the additional costs incurred by energy generators in the PSO-supported scheme. It is approximately €330 million. 28% was applied to renewables and 31% to ensure security of supply.

Electricity Regulation Act 1999 (Public Service Obligations) (Amendment) Order 2015. The 2016 allocation for the PSO is 50% renewables, 27% piece, and 13% security of supply.

The levy for 2016 was nearly €400 million. This entails a monthly charge of approximately €6 for domestic and €20 for commercial customers.

The PSO levy for 2017 is €471 million. This leads to a monthly charge of €7.69 for domestic and €26.55 for small commercial customers. Large-scale customers are charged on the basis of their use.

Energy Policy

The 2007 Government White Paper on Energy Policy, Delivering a Sustainable Energy Future for Ireland — The Energy Policy Framework 2007-2020 set out a number of strategic goals to support the achievement of the overall policy objectives.

This included an ocean (wave and tidal) energy target of 500 MW by 2020. The Ocean Energy Development Unit  in SEAI has conducted a strategic environmental assessment (of offshore wind, wave and tidal development scenarios in a draft offshore renewable energy development plan, and two pilot projects have been grant-aided

The development of nuclear power installations is prohibited under s.37K of the Planning and Development Act 2000.