RHI in #Budget2018 – How Does it Look?

Budget2018 has seen the launch of €17M for the Renewable Heat Incentive Scheme. €7M is to go towards the first phase of the RHI with the remainder seemingly marked for further uptake of electric vehicles. While at this stage exact details or specifics are not clear this does not send out a very positive signal to the bioenergy industry in Ireland and is perhaps a nudge in the wrong direction. Is this the same €7M that was allocated for the RHI in #Budget2017? It certainly looks like it as that €7M was never spent on any RHI.

An RHI scheme was first officially conceived as part of the Bioenergy strategy consultation in May 2013, and formally announced in the October 2014 Draft Bioenergy Plan. There has been a significant impact of carrying on with business as usual over recent years. Approximately 550 toe (tonnes of oil equivalent) of additional fossil fuels are burnt each day as the policy is being developed. Since 2014 c. 800,000 toe have been avoidably consumed. There is also a negative social and economic impact associated with business as usual. There are many bioenergy businesses that have ceased to exist due to industry stagnation since 2008. Many skilled people have applied themselves to other technologies or other jurisdictions to make ends meet.

At a time when the Government is in a big race against time to avoid a potential fine of at least €610m from the EU for failing to hit renewables targets. 2017 looked set to be a defining year for the country’s energy sector and the clock is ticking faster than perhaps the Government would like. At this stage 2017 has come and gone. If Ireland fails to meet an overall binding target of generating 16% of renewables composed of electricity (40%), heat (12%) and transport (10%) within three years, a penalty of up to €120m will be imposed by the European Commission for every 1% the State falls below this target. It is currently set at 8.6% so quite a path to travel. By 2030 the target is set at 27% renewables with even greater fines being proposed.

Minister Naughten is under pressure to implement policies to help avoid or reduce the potential bill facing Irish taxpayers and he has failed to listen to the advice of the bioenergy industry in Ireland. Instead of paying €610M in fines to EC, surely these potential fines would be better spent implementing and approving budgets for new policies such as the Renewable Heat Incentive (RHI). Minister Naughten thinks that the bioenergy industry in Ireland is sound and secure. The disasater that was REFIT 3 is testament of this with a low uptake, wrong strike price and burdensome administration. The RHI needed to be launched with more conviction to enstill confidence back into bioenergy.

The European Commission has highlighted the country’s unimpressive status by ranking Ireland 23rd out of 28 member states for renewable energy. Critics of the Government’s strategy on renewable electricity blame Ireland for having relied too heavily on onshore wind to reach its targets. This is testified by how many days Ireland can run on bioenergy which is currently only 13 while Sweden can last 132 days and Finland 121 days.

Socio Economic Impacts of an RHI Scheme that may be lost due to delays include New investment in biomass heating of over €220M. Annual spend of over €77m on operation and maintenance. €1.5 billion of direct investment into the Irish economy. Reducing Ireland’s energy import bill by 7.5%. Matching locally grown biomass with local energy demand will support 3600 new jobs. RHI will displace €120M/year of imported fossil fuel and encourage indigenous security of supply.

With over 200 members, IrBEA is the national association representing the bioenergy industry on the island of Ireland. The main objectives of the association are to influence policy makers, to promote the development of bioenergy and to promote the interests of its members. Improving public awareness, networking and information sharing and liaising with similar interest groups are other key areas of work in promoting biomass as an environmental, economic and socially-sustainable energy resource. www.irbea.org and www.bioenergyfutureireland.com

Report on ‘Growing the Irish Bioeconomy’ – COFORD Report September 2017

The gross output of the Irish forest sector is set to double by 2035 against a backdrop of increasing carbon constraint, this creates many opportunities for the Irish Bioeconomy. COFORD have produced a report on Growing the Irish Forest Bioeconomy which provides a vision of a healthy forest bioeconomy, creating sustainable jobs in rural Ireland and supporting national land-use carbon reduction and climate adaption objectives. It is an accessible document with plenty of infographics, key points and statistics. It includes an interesting piece on ‘12 Proposals for Growing a Vibrant Forest Bioeconomy in Ireland’, view the report here

Western Development Commission & SEAI Undertakes Biomass Survey in Ireland

The Western Development Commission (WDC) along with the Sustainable Energy Authority of Ireland (SEAI) are tasked to complete a regional renewable energy analysis on the use of biomass as a local contribution to the national renewable heat target. They wish to develop a range of actions to support the development of renewable energy in the region under the Action Plan for Jobs. This will inform how we support and develop biomass use in this region. They are keen to understand more about how businesses operate their own heating systems and if they have any plans for further biomass investment or use.  They would also like to know your general views on the biomass sector.

All information provided will be treated in strict confidence, you are encouraged to participation in this on-line questionnaire and contribute to the report. Start the questionnaire here

Bord na Móna Bioenergy Plan to Invest in Wood Pellet plant in US to Secure Biomass Supply

Mark Paul reported in the Irish Times (19 September)  that Bord na Móna intend  to invest up to €60 million in a proposed new wood pellet plant in the US state of Georgia that could be operational within two years. The company wants to construct the facility to turn willow trees into pellets, which will then be shipped back to Ireland to fire power stations. It is part of Bord na Móna’s strategy to shift away from its core peat business towards more renewable energy sources, especially biomass. Bord na Móna say they are forced to invest abroad while the Irish biomass-supply industry is ramped up to meet demand. The proposed investment is currently with the government’s New Era division for approval. View the Irish Times Article here

Article in TheJournal.ie  – ‘Leo’s Approach to the RHI scheme’

As we know Ireland’s Department of Communications, Climate Action and Environment (DCCAE) is bringing its version of the Renewable Heat Incentive (RHI) to Ireland, here the scheme is explained to the public in simple terms. It discusses the aim of the scheme which is to help Ireland reduce its 12% target in the renewable heating sector by 2020. It quotes the key figures – that 6.6% of heat demand was derived from renewable sources in 2016, which means we need to double that in the next two years to hit those all-important EU targets.

For IrBEA getting this data into the public domain is important, educating everyone as a whole on the benefits of the system are key to getting the scheme up and running. One of the points made in this article is how this scheme aims to differ from the Northern Ireland RHI scheme which failed to control costs and attracted negative publicity over the last year. Energy Minister Denis Naughten is quoted as saying “The lessons learned from the Northern Ireland scheme are being integrated into the design of the Renewable Heat Incentive,” Read the whole article here

Ger Devlin interviewed by Irish Farmers Journal – Key Issues for the RHI Scheme

Irish Bioenergy Association executives were at the Ploughing, Ger Devlin (IRBEA CEO) took part in the panel talks at the Bord na Móna stand that included Matt Cooper of TodayFM as host, as well as Patrick Madigan (Head of Biomass BNM), Mike Quinn (BNM CEO), Cormac O’ Carroll (Poyry Consulting) and Minister Naughten.The Minister commented that the Renewable Heat Incentive (RHI) scheme was expected to unlock the indigenous biomass industry and will be finalised as part of Budget 2018, adding “The RHI is part of the whole budget discussion at the moment. I’m meeting with [Finance Minister] Paschal Donohoe next week”

Ger Devlin in addition to the panel talked to Thomas Hubert of the Farmers Journal and commented that the key message for the Minister when delivering the RHI is the correct price point for the tariff so that there is a positive uptake and timing to stimulate confidence back into the bioenergy industry in Ireland.

Listen to the full interview with Ger Devlin and Thomas Hubert, at the podcast link below (5 mins): Podcast link