Is Ireland losing out to other EU nations on renewables?

6 Oct 2011

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Minister for Environment, Community and Local Government Phil Hogan with, from left: Kenneth Mathews, CEO, IWEA, David Gunning, CEO, Coillte and Stephen Wheeler, chairman, IWEA, at the WInd Energy (IWEA) conference in the INEC, Killarney

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The Irish Wind Energy Association has today released alarming statistics, asserting that Ireland is losing out to other European nations on renewables, despite having some of the best wind and wave resources on the planet, waiting to be used to power up the island more cleanly, and also impeding the country’s potential to engage in renewables exporting with other countries, down the line.

According to the IWEA, Ireland is only meeting 68pc of its 2010 targets for 2010, with competing European nations now gleaning a critical edge in the green stakes, snapping up opportunities before the country.

The IWEA is blaming the slowdown on three things:

  • Uncertainty for investors;
  • An over-complicated regulatory framework, and;
  • Resultant grid connection delays that are "choking" the sector.

On the opening day of the IWEA autumn conference in Killarney today, the IWEA warned that Ireland has witnessed an "alarming slowdown in the pace of renewable energy development in the last two years and is falling way behind European competitors with significantly less resources".

Addressing more than 300 delegates during ‘28,000 Jobs’, alluding to the job creation potential of the sector, newly appointed chief executive Kenneth Matthews said the net result of investor uncertainty and an over-complicated regulatory framework is that competing nations in this sector, including neighbouring Scotland, "are stealing a march on Ireland because of its prevarication and that thousands of jobs and billions in investment are being lost by us in the process."

National Renewable Energy Action Plans – 2010 stats

Renewables

A European-wide league table based on targets from National Renewable Energy Action Plans (NREAP) submitted by member states in 2010 shows that Ireland, by the end of this year, will have achieved just 68pc of its target for 2010, said the IWEA today.

This is in contrast with Belgium (120pc), Sweden (115pc) and Denmark (105pc).

The IWEA believes Ireland could connect as little as 200MW this year when 400MW is the NREAP target.

“The final figures for Ireland at the end of 2011 will look poor again as we will likely only reach 1,620MW when 2,290MW was the 2011 target," said Matthews this morning.

"The absence of a co-ordinated and cohesive system for facilitating the delivery of required wind-farm installations to meet our 2020 targets is resulting in an unstable market for investment and that is driving the investment and thousands of jobs elsewhere," said Matthews.

"Take Scotland, for instance. They intend to deliver 100pc of all energy requirements from renewable sources by 2020. With that clear market signal they are attracting significant foreign direct investment and jobs. People think we are ambitious by targeting 28,000 jobs but Scotland intends to replace the 120,000 jobs at risk in oil and gas as the North Sea fields are wound down with green-energy jobs.  

"The return from this intent is notable. A stg£50m (€58m) FDI offshore wind technology centre is being established in Glasgow, creating 300 jobs in the process. They already have significant investment from leading global companies such as ABB, Rolls Royce and Vattenfall. Further down the UK, in Hull, Siemens are planning to establish a wind-turbine manufacturing factory – creating 700 jobs directly and 500 in related businesses."

Siemens windfarm

A Siemens offshore windfarm

Denmark’s DONG Energy invests in Belfast Port

Continued Matthews: "Closer to home, in Northern Ireland, they are investing heavily in Belfast Port and recently secured 450 jobs with DONG energy – Denmark’s leading energy company – with a £40m investment. Our nearest neighbours clearly have their house in order and are attracting significant investment as a result. We don’t have ours in order and we are losing out heavily."

Matthews said it is "regrettable" that key international players can have vast confidence in Ireland’s resources, yet we have yet to capitalise on this ourselves.

“A study by Siemens, one of the world’s leading energy companies, found that Ireland has one-third of all of northwest Europe’s renewable energy resources, including the world’s most energy-intensive waves and Europe’s highest wind speeds, yet we don’t seem to have transferred the opportunity of this immense bounty into actual jobs."

He went on to talk about Vestas, the world’s largest wind turbine manufacturer, which has stated it will create thousands of jobs somewhere in Europe in a new coastal manufacturing plant but hasn’t decided where yet.

“We should be all over these companies in the way that other countries are.

"The IWEA is warning about us not having our act together for the last three years yet we are continuing to fall behind to nations that don’t have anything like our wind resources. At the moment we are not just falling way behind the Scandinavians or Scotland but even Romania in terms of meeting our targets. We need to ask ourselves the question: do we want to be in the same space as Romania which has little resources, or do we want to be ahead like the Nordic countries or have Scotland’s ambition?  

"We are now at a critical juncture. If we want to see the large-scale expansion of the Irish wind industry and the extremely positive economic development and job creation that will flow from it, not to mind greater grid security and stability and lower energy prices, we need to really up our game."  

Views from climate change economist Richard Tol

Speaking about the renewable energy sector in general, Richard Tol, a professor of the economics of climate change from Vrije Universiteit Amsterdam, believes that electricity would be "cheaper and government borrowing lower if the support for wind would end".

"Pouring money into an uncompetitive industry does not create jobs. Lower costs and lower taxes do," said Tol today, in response to the IWEA’s findings.

Tol went on to say that the energy sector is "labour extensive".

"It will never employ many people, in Ireland or elsewhere. Ireland is unlikely to be a major exporter of renewable energy, because we are far from the centres of demand and transport of power is expensive. Ireland is unlikely to be a major exporter of renewable energy equipment, because that is bulky and expensive to transport. Ireland is unlikely to be a major player in innovation for renewables, because we do not have the correct expertise at present and we do not have the money to invest in building up that expertise."

Among the priorities identified by Matthews, if Ireland is to "turn the opportunity back in its favour", are:

  • The Renewable Energy Feed-in-Tariff (REFIT) support scheme needs to be introduced immediately and no later than 2011.
  • A stable policy framework for the treatment of wind in the market needs to be set.
  • The strategic importance of the development of grid infrastructure needs to be recognised.
  • A planning forum to facilitate generic (not project specific) communication between industry and planning authorities on relevant issues should be established. This would enable the delivery of better quality applications and allow investors to understand which projects are appropriate to bring to full application stage.
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Carmel was a long-time reporter with Siliconrepublic.com

editorial@siliconrepublic.com