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DUBLIN, Ireland, May 10, 2006 (Refocus Weekly)
A new initiative by the government of Ireland
will support construction of 400 MW of new green power capacity that
will displace the emission of 1 Mt of greenhouse gases each year.
The Renewable Energy Feed In Tariff will double the contribution
of renewable energy electricity to 13.2% by 2010 from 5.2% in 2004,
by increasing the total capacity of green power technologies to
1,450 MW, says natural resources minister Noel Dempsey. The
additional capacity will require a capital investment of Euro 440
million by developers and total investment by consumers of Euro 120
million over the 15 year life of the support program.
Most of the new power will come from wind turbines, but the program
is also available to biomass-powered generating projects,
small-scale hydro and projects capturing landfill gas emissions. The
additional capacity will supply power to 260,000 homes and reduce
Ireland's dependency on imported fossil fuels by 2.5 million barrels
of oil (4 oil tankers) every year, or 37.5 million barrels (60 oil
tankers) over the 15 years that support is given to renewables.
“This program responds to market demand for a move away from
competitive tendering but also protects consumers by imposing fixed
prices,” says Dempsey. “If we are to meet our Kyoto obligations, we
must maximize the contribution made by green electricity.”
The program will improve Ireland's national trade balance by
reducing energy imports by Euro 75 million a year, which will inject
Euro 1 billion into the local economy over the 15-years life of the
contracts. It will also create 300 long-term jobs in operation and
maintenance, and 1,100 full time construction jobs.
“Harnessing renewable energy is an essential part of delivering on
our Kyoto obligations,” says Dempsey. “The target set is challenging
but achievable. It is my intention not to limit our ambition to the
achievement of short-term targets but to develop this sector in an
ambitious yet realistic manner.”
The government will consider targets for the post-2010 period in the
context of a green paper on energy to be published later this year.
Under the previous ‘AER’ support program in Ireland, project
developers bid prices at which they were willing to sell green power
to the ESB for 15 years, and the revenue stream was sufficient to
allow developers to secure bank debt to finance the capital costs
(typical debt is 75% of Euro 1.1 million per MW built.
Under REFIT, project developers are free to negotiate with any
suppliers and the purchase price is negotiated between generator and
supplier directly. Consumers are protected by price caps, ranging
from Euro 57 per MWh for large wind and Euro 59 for small wind, to
Euro 72 per MWh for hydro and biomass.
Ireland has doubled the connected capacity of green power over the
past two years, with 846 MW now fully connected to the grid,
including 50 windfarms with 574 MW of capacity.
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