Dáil Éireann debate -
Tuesday, 14 May 2024

Vol. 1054 No. 1

Ceisteanna ar Sonraíodh Uain Dóibh - Priority Questions

Energy Conservation

Darren O'Rourke

Question:

50. Deputy Darren O'Rourke asked the Minister for the Environment, Climate and Communications the number of heat pumps installed to date relative to the 2030 target of 400,000; the challenges he has identified with heat pump installation; his plans to address these; if alternative technologies are being considered; if he is aware of the high number of calls made to the Society of St. Vincent de Paul, SVP, regarding to high electricity bills associated with heat pump use; and if he will make a statement on the matter. [21896/24]

Deputy Darren O'Rourke

This question relates to the number of heat pumps installed to date relative to the 2030 target of 400,000. Will the Minister of State outline the challenges he has identified with heat pump installation and his plans to address these, if alternative technologies are being considered and if he is aware of the high number of calls made to the Society of St. Vincent de Paul and others regarding high electricity bills associated with heat pump use.

Minister of State at the Department of the Environment, Climate and Communications (Deputy Ossian Smyth)

I thank the Deputy for the question. The national retrofit plan set targets to carry out 185,000 energy upgrades and install 45,000 heat pumps in existing homes by 2025 and the equivalent of 500,000 B2 upgrades and 400,000 heat pumps by 2030. Between 2019 and the first quarter of 2024, almost 150,000 energy upgrades were supported by the Sustainable Energy Authority of Ireland, SEAI. Expenditure increased from €104 million in 2019 to a record €324.5 million last year and the budget is €430 million this year. Demand across the SEAI schemes is growing and so is spend and output.

Heat pumps are one of the most challenging technologies to implement at scale in the existing residential sector, though new builds are predominantly using them. Research indicates that upfront costs and ancillary works can be seen as obstacles. We are addressing these issues under the national retrofit plan and heat pump delivery is growing, with 16,600 installed in existing homes with support from SEAI schemes or under the local authority scheme, including a fourfold increase between 2019 and 2023.

Heat pumps are extremely efficient and very economical to run with no requirement for additional heating sources, meaning there are no additional bills for oil, gas or solid fuel. While electricity prices remain above pre-pandemic levels, consumers have experienced reductions in electricity prices in recent times. This reduction is welcome but I am aware that some homeowners, both with and without heat pumps, have faced challenges with their bills. It is important to note that throughout the period of high energy prices, Government has continued to support energy consumers to stay warm and well. This includes a €2.2 billion suite of cost-of-living supports to assist families, pensioners, carers and people with disabilities as part of budget 2024.

My Department is currently developing a revised energy poverty action plan and I would encourage all stakeholders to make a submission to the consultation process.

Deputy Darren O'Rourke

The first part of my question was straightforward but I do not think the Minister of State answered it in his response. To reiterate, there is a 2030 target of 400,000 heat pumps. To date, how many of those pumps have been installed? By my estimation, on the figures I have received, it is in the region of 10,000, or 2.5% of the total. The Government is behind its own targets by 30%, which is a significant amount. By all accounts, from listening to people and engaging with those who are having retrofits done or who are eager to have retrofits done, there are real challenges regarding the installation of heat pumps. What is the Government going to do to address that? Will the Minister of State acknowledge those figures? Will he update us on the heat loss indicator study to see if there are additional properties that may be suitable for heat pumps?

Deputy Ossian Smyth

So far, 16,600 heat pumps have been installed in existing homes. The target for 2025, which is the next target date, is 45,000, so we have to get from 16,600 to 45,000 in two years to meet the 2025 target. The next target after that, which is much more demanding, is 400,000 heat pumps by 2030. The structure of these targets is set so the vast majority are in the second half of the decade compared with the first half. That is the answer on heat pump installation.

Approximately 90% of new homes that are built are being fitted with heat pumps. As about 30,000 homes a year are being built, this means approximately 27,000 pumps are being installed every year in new homes. It is a new and complex technology, but this is helping with the skilling that is required to both install them and maintain them for the future.

Deputy Darren O'Rourke

On the second part of the question, what engagement has the Minister of State or the SEAI had in regard to the practicalities of operating heat pumps when they are installed in existing properties? I am thinking in particular of the energy poverty strategy as it relates to social housing. I have heard on a number of occasions of heat pumps being incorrectly installed or operated. For example, one constituent who has a recently installed heat pump is reporting electricity bills in the region of €1,000 - to be precise, €745, €1,135 and €1,018 - compared with her neighbours, who are reporting electricity bills of €150 or €200. I raised this with Meath County Council. Obviously, it would be a dreadful story for heat pumps if they are heaping additional costs onto people. Whether it is an educational piece or an installation piece, it needs to be addressed. The Society of St. Vincent de Paul is reporting increased calls.

Deputy Ossian Smyth

In order to install a heat pump, people need to ensure their home is suitable for heat pump installation, certainly in terms of whether it is insulated sufficiently to be ready to have the heat pump installed. Installation of a heat pump is a skilled activity and requires an understanding of connecting the heat pump with the plumbing system, for example, so it does take certain skills. The SEAI approves and certifies suppliers for doing this and it provides advice to homeowners on what type of insulation they need to install a heat pump. Presumably, there are heat pumps that have been incorrectly installed.

I do not think the usefulness of heat pumps is in question. However, I am sure it would be worth having a study to see what the actual performance of heat pumps is in the real world and how they are functioning in the retrofit system in Ireland. I know the SEAI regularly carries out studies to see what the actual performance is of the buildings they have subsidised for upgrades. I accept the Deputy’s suggestions in this regard.

Electricity Generation

Darren O'Rourke

Question:

51. Deputy Darren O'Rourke asked the Minister for the Environment, Climate and Communications the total electricity generation capacity that has been energised since February 2020, broken down by fuel source and year; what percentage of Ireland’s electricity was imported in each of the years since 2020; and if he will make a statement on the matter. [21897/24]

Deputy Darren O'Rourke

I ask the Minister of State the total electricity generating capacity that has been energised since February 2022, broken down by fuel source and year; what percentage of Ireland's electricity was imported in each of the years since 2020; and if we will make a statement on the matter.

Deputy Ossian Smyth

The climate action plan sets challenging targets for installed generation capacity in 2030. This includes 9 GW of onshore wind, 8 GW of solar and at least 2 GW of additional gas-fired generation capacity. Ireland now has over 6 GW of renewable electricity generation capacity, with 46% of electricity generated in Ireland in 2023 being renewable.

I am informed by ESB Networks that the following volume of generation has been grid-connected since 2020 by fuel source and year. I will share a written copy of the table with Deputies and will now outline the following summary. Some 784 MW of onshore wind has been grid-connected since 2020; 654 MW of grid solar has been connected since 2020 and, for clarity, this excludes rooftop solar, which is growing at pace; and 718 MW of batteries have also been grid-connected in this time period. For gas-fired generation capacity, 243 MW has been grid-connected so far, with a further 433 MW due to be connected in the coming weeks. In total, this means over 2 GW of new generation capacity has been grid-connected since 2020, with a further substantial amount of generation capacity due to come online this year.

Ireland's net import of electricity accounted for 9.5% of electricity supply in 2023, which compares with 0.7% of electricity supply in 2022 and 4.8% in 2021. Ireland was a net exporter of electricity in 2020.

Deputy Darren O'Rourke

Although it was not what prompted the question, the Minister of State will have heard from the Climate Change Advisory Council yesterday in regard to the electricity sector and the reports on the challenge of meeting our targets. We had a roundtable last week involving members of the Oireachtas climate committee and some of those in the offshore wind sector. Both of those examples paint a similar picture of ambition but a failure to implement at pace and scale the type of change that is required. We talk about a lost decade in terms of renewables between 2010 and 2020. In effect, we had a lost year last year and we cannot afford lost days, never mind lost years, in the roll-out of renewables. One of the issues raised by the CCAC was the need to progress the transposition of the revised renewable energy directive. When will the Government do that?

Deputy Ossian Smyth

The Government acknowledges the Climate Change Advisory Council report and agrees that we must move at greater speed and scale to achieve our electricity targets. Ireland has achieved an unprecedented decrease in energy-related emissions. We had a 7% annual reduction last year and a 21% decrease in electricity-related emissions. This is despite a large increase in our population and a large increase in energy use. It is because of a great increase in wind and solar renewable electricity and also increased overseas interconnection.

Under our climate action plan update, Ireland is targeting to reach 80% of electricity demand from renewable sources by 2030. We have emissions reductions driven down through onshore wind, onshore solar and 5 GW of offshore wind. That is very ambitious. To reach 80% of our electricity demand coming from renewable sources by 2030 and to have a clear plan to reach that is certainly ambitious. Acceleration of the deployment of renewable energy this decade, especially onshore wind and solar, is now fundamental to meeting our sectoral climate targets. The main issues we have faced are planning barriers and delays relating to planning difficulties. That is why the Government is bringing in its new Planning and Development Bill, which will be enacted this summer.

Deputy Darren O'Rourke

This echoes previous reports from the CCAC which point towards progress in terms of legislation, regulation and planning but, repeatedly, there is an implementation deficit. Last year certainly saw an implementation deficit. We need to be energising 1.6 GW a year of new renewables, new grid scale and onshore renewables but, instead, it was just 0.6 GW last year.

What is the Government going to do to ensure those onshore renewables are delivered? There are obviously issues with the planning system. Time is of the absolute essence. The question I asked was about the renewable energy directive. Other countries have used that as a mechanism. The European Union has essentially given the green light on it to deliver renewables at scale. Is the Minister of State going to take that opportunity or what else is he going to do?

Deputy Ossian Smyth

I think the first part of the question was about delivery. It was about how much the Government has installed of new capacity. We have seen more than 2 GW of capacity installed over the course of the past four years. The fact there is now 1 GW of solar on the grid is incredible. I expect another 1.5 GW will be added this year and another 1.5 GW next year. Looking towards an 8 GW target for 2030 is absolutely achievable.

What I see in all of these areas, despite the challenges, is delivery. I see connection of new wind onshore. I am seeing connection of solar for the first time ever. I see renewable energy from offshore wind coming in huge volumes soon, and I see that following on from the EU's prescriptions about how we should speed up our planning process and so on, the DMAP has now been designated for the south of the country off the coast of Waterford and Wexford. That has been clearly announced to the market. I see a lot of interest from wind farm companies investing in Ireland. Overall, I see a large volume of not just electricity being put onto the grid but customers from other European countries coming to Ireland and saying they want to buy our excess renewable energy in the future.

Corporate Governance

Jennifer Whitmore

Question:

52. Deputy Jennifer Whitmore asked the Minister for the Environment, Climate and Communications to detail the process for the establishment of Re-Turn Ireland; the governance structures of that entity; and if he will make a statement on the matter. [21899/24]

Deputy Jennifer Whitmore

I wish to ask the Minister for the Environment, Climate and Communications to detail the process for the establishment of Re-Turn Ireland, the governance structures of that entity, and if he will make a statement on the matter.

Deputy Ossian Smyth

A national deposit return scheme, DRS, has been introduced to encourage more people to recycle bottles and cans and to ensure we meet our ambitious EU targets for the recycling of those materials under EU single-use plastics and packaging legislation.

The Separate Collection (Deposit Return Scheme) Regulations, SI 599 of 2021, makes it the responsibility of beverage producers to establish a deposit return scheme and to nominate an operator for approval by the Minister. Those regulations were updated by the Separate Collection (Deposit Return) Regulations 2024, which is SI 33 of this year.

Deposit Return Scheme Ireland CLG, trading as Re-Turn, was established by the Irish beverage industry as a new, not-for-profit company to fulfil its obligations under the DRS regulations. In July 2022, I approved an application from Re-Turn to establish and operate a DRS. This approval is valid for a period of ten calendar years from its commencement date. A review of the approval will take place by July 2025 and that approval will be reviewed every three years thereafter. Re-Turn is obliged to deliver to me an annual report on the scheme, with the first report due by mid-summer.

Under the terms of its approval, Re-Turn is required to operate to the highest standards of corporate governance and specifically in accordance with the code of corporate governance developed for extended producer responsibility schemes. This code is based on the underlying principles of accountability, transparency and probity. My Department is monitoring all operations by Re-Turn closely and I receive very regular updates.

Deputy Jennifer Whitmore

I thank the Minister of State. I have a number of concerns about it. They may all be completely fine and not warranted, but there is no information on the Re-Turn website anywhere about the organisation, how it is structured, who the board of directors are or any of that information. When the Minister of State talks about transparency, it is not there at the moment. He talks about the highest standards of corporate governance. When you look at the board - I have seen a list of names online of people who are on the board but I do not know if this is correct - it would appear there are 11 people on the board. Seven of them are large producers, such as Coca-Cola, Diageo and Heineken. It reads more like a stakeholder group than a board of directors.

It is very unusual to have people on a board who could be deemed to be conflicted because of their originating company. I would be interested to know why those people are on the board and it is not based on skills, which is usually how a board is formed. You look for someone who has accounting, communication and marketing skills, not people who are stakeholders.

Deputy Ossian Smyth

I thank the Deputy. I take her point that she did not find sufficient information on Re-Turn's website. As I said, I speak to it regularly and indeed receive information from it daily. I will ask it to update its website and add more information, certainly to the level that is on any other. I did not check.

The members of the board, for confirmation, are Tony Keohane, who is independent; Tara Buckley, who represents RGDATA, which is a collection of small retailers; Thomas Bourke from Coca-Cola; Conor Hyland from Heineken; Kevin Donnelly from Britvic Ireland; Rosemary Garth from Tesco; Joseph Owens from the Claddagh Group, which is a west of Ireland bottling company; Shane Kelly from Lidl; Noreen O'Kelly, independent; and David Kelly, independent.

The company is structured as a not-for-profit. It cannot legally distribute profits to its members or distribute dividends. It has also been legally constituted to be a membership organisation that is a producer responsibility organisation. It is built on the same framework or template as an organisation like Repak.

Deputy Jennifer Whitmore

I would be interested, and the Minister of State might not have the figures now, in what the salaries of the staff are and whether there are any bonuses or salaries being provided to the directors. That is very important information. Regarding the revenues that are made by this not-for-profit company, they could actually be quite large. It has been estimated that from 1 February to this point, there is potentially €65 million in unclaimed vouchers that will be staying with this company. That is a large amount of money. I know it is just the start of this scheme and I would imagine that will be the Minister of State's argument, that it will not be like that all the time. However, if we are looking at Denmark and its 92% rate of recycling, if we apply that in Ireland, that would still mean there are 152 million cans and bottles every year that will not be returned through this scheme. That would equate to between €23 million and 38 million a year, minimum, that this company will have. Does the Exchequer see any of this money or does it remain in this organisation?

Deputy Ossian Smyth

I will explain the financial structure of the company, very briefly. Yes, I expect that eventually, when the scheme is mature, it will only be returning 92% of cans and bottles, that is, 8% where a deposit is paid and not returned. The money from that pays to run the scheme, in co-operation with a payment by the producers that will be of a similar quantity. The amount of money from unclaimed deposits will be similar to the amount of money paid in by producers for each bottle or can they produce and put on the market. At the moment, that amount is 2 cent for a plastic bottle and 1.25 cent for an aluminium can. There is a third source of revenue for Re-Turn, which is the value of the aluminium and the plastic that is collected. What the company did was produced its financial projections, we analysed them with our financial consultants, and it constructed a scheme for a company that pays for itself and which is non-profit. In other words, the amount of money that comes in matches the amount of money that goes out. That is the structure of the company, and this is a well-understood and well-tried and tested company structure like Repak and every other extended producer responsibility scheme.

An Ceann Comhairle

We move to Question No. 53 in the name of Deputy Darren O'Rourke.

Deputy Jennifer Whitmore

Do I not come in again?

An Ceann Comhairle

No.

Renewable Energy Generation

Darren O'Rourke

Question:

53. Deputy Darren O'Rourke asked the Minister for the Environment, Climate and Communications the measures he is taking to address surplus renewable energy that is wasted; if he plans to introduce measures to redirect surplus energy to energy-poor households; and if he will make a statement on the matter. [21493/24]

Deputy Darren O'Rourke

I want to ask the Minister of State the measures he is taking to address surplus renewable energy that is wasted; if he plans to introduce measures to redirect surplus energy to energy-poor households; and if he will make a statement on the matter.

Deputy Ossian Smyth

The climate action plan recognises that a range of cross-government policies are needed to transform our electricity system so that it can become more flexible and successfully accommodate an ever-increasing volume of renewable energy sources that are widely distributed across our island.

The dispatch down of renewable energy refers to renewable energy that is available to the grid but must be reduced as it cannot be used by the electricity system. This can be due to broad power system limitations, known as curtailments, local network limitations, known as constraints, or energy supply exceeding consumer demand. Dispatch down is unfortunate and both EirGrid and ESB Networks are addressing the grid limitations that cause it through various measures under their strategic roadmaps. Dispatch down can also be minimised by the adoption of demand-side response measures and greater levels of interconnection and storage.

We also recognise that Ireland’s citizens and communities can play a central role in our new energy future through flexibly managing their energy use in response to the level of renewable energy available.

By doing so, they can not only support the electricity grid but also lower their own energy bills and reduce their carbon footprint. The energy security package recognises this, and it commits the Government to improve the ways that homes and businesses manage their energy use by providing an evidence-based programme of communications and supporting active consumers through smart metering, smart energy services and related technologies.

These services will enable consumers, including those who are in energy poverty, to flexibly adjust their demand in response to market signals and the changing level of renewable energy that is available. Furthermore, a consultation to inform the development of a revised energy poverty action plan was published on gov.ie in March 2024. The revised plan sets out a wide range of clear, time-bound actions aimed at tackling energy poverty with appropriate governance and evaluation, and considers the use of smart technologies, such as those used by EnergyCloud and other smart energy technology and service providers, to benefit energy-poor households and other vulnerable citizens.

Deputy Darren O'Rourke

The Minister of State is familiar with the EnergyCloud model, and the Minister, Deputy Eamon Ryan, has said positive and encouraging things about it. The Minister of State spoke of “dispatch down”. He is the Minister of State with responsibility for the circular economy, and it is a waste of energy. Poor people’s hot tanks are there, waiting to be charged and store that energy. They are immediately available and there is a need to link one with the other. I am not entirely sure from the response the Minister of State gave tonight, or indeed from the written response by the Department to the climate committee today, whether that is seen as an immediate solution. I think it is an immediate solution and it needs immediate action. I wonder, given what the Minister of State has said, if he sees an improved grid and storage elsewhere as the answers.

Deputy Ossian Smyth

As I understand it, EnergyCloud works by offering people who are on low incomes the chance to have a hot tank of water overnight, and that is done through energy that otherwise would have been thrown away and wasted. I understand this has been a successful experiment. I was asked about it before it started a couple of years ago and I understand that since it has been running it has been working well. It is for that reason that it is part of the energy poverty action strategy, which is in consultation at the moment. I urge the Deputy to make a submission on that and say whether he thinks it should be continued or changed in any way.

Part of the response to this is how we will make sure we are not wasting energy by having sufficient grid and sufficient connections to the rest of the world. At the moment, our electricity connections are only to the UK through Northern Ireland. We are strengthening our connection to Northern Ireland, and we are also building a new connection to France. We are in discussions with Belgium, the Netherlands and Spain.

Deputy Darren O'Rourke

To be clear, my colleagues, Deputy Ó Laoghaire and Senator Boylan, will be making our submission tomorrow. I think the deadline is tomorrow.

Deputy Ossian Smyth

Yes.

Deputy Darren O'Rourke

We will clearly say we believe there is an immediate strong and positive role for EnergyCloud and, in the future, for other technologies for an improved grid, improved battery storage, and everything else that goes with that.

I want to know if the Minister of State supports it. If he does support it, what needs to happen is for ESB Networks and the CRU to come together with EnergyCloud to ensure the regulatory processes are in place. The potential is immediately there. They are essentially working on a pilot basis with a number of Clúid houses at this stage. Almost to embarrass us, from time to time they publish the amount of energy that is lost to the system - it is hundreds of millions of euro. At the same time, hundreds of thousands of people are living in energy poverty. The Minister of State needs to act and match those two things up.

Deputy Ossian Smyth

There is a very simple answer to the question of whether I support the EnergyCloud system that takes energy that otherwise would have been thrown away and gives it to them to heat their water at night. Yes, I absolutely do. It has been a very successful experiment and I want to see it continuing. If we are going to continue with this kind of system, people need somewhere to store the energy in their home. A tank of water is one way of doing that, and a battery on the wall is another. An electric car is another option.

Over the last two years, energy credits were only a part of a much larger system of trying to give people money to make it possible for them to get through the winter without being cold. In other words, we subsidised the increased cost of electricity over the last two years. We spent €2.2 billion over the last two winters putting money directly into people’s accounts. I would much prefer if we needed to target payments in the future that we could provide electricity to people to store directly in their homes, particularly from sources that were cheap or that would otherwise be thrown away. I think we could have devised a much better system for the future and working on this would be well worth it. It would pay for itself. I look forward to its success in the future.