Challenging times

THE FRIDAY INTERVIEW/Eamon Ryan Minister for Energy:Eamon Ryan had to display a bit of political adroitness at a press conference last week. While he was attending the launch of a report on the Irish energy market, part of his ministerial brief, he was "ambushed" by a question relating to an Opposition motion on proposals for an incinerator in Dublin Bay.

Ryan's Green Party and cabinet colleague, environment minister John Gormley, is at the centre of that particular row. He quickly pointed out that the law restricts Gormley from intervening directly in the controversy, as the matter was going through the planning process.

While the reporter pressed him, Ryan stuck to the Government guns and refused to give the game away. Anyone who was hoping for a little political naïveté from the newly appointed minister went away disappointed.

All the same, you could have forgiven him a slip at this stage. He's just a few weeks in Cabinet and this is only his second term as a TD. A relative newcomer to national politics, he has, however, got a pretty big job.

Ryan is one of the two Green Party members with senior government posts. His brief, communications, energy and natural resources, is one that's very close to his party's heart, dealing as it does with areas that relate directly to climate change and sustainable development. In fact, it's arguably a "greener" job than leading the Department of the Environment.

But it's also close to the heart of business people, who have seen their energy bills climb steeply over the last five years and who are gritting their teeth for more of the same following this week's rise in oil prices.

There's not much he can do about the price of Brent crude in New York. As energy minister, however, he is charged with overseeing Government policy in the area, which is, theoretically at least, geared at promoting competition, bringing down costs and meeting the State's obligations under Kyoto and other international treaties which are designed to tackle the global problem of climate change.

Despite the challenge, Ryan is optimistic about meeting these goals. At one point during the press conference at which he had to bat the Poolbeg question, he said: "I'd like to think that in the future, people will come to Ireland and see that not only have we met these challenges but we've turned them into opportunities, and say that's the model we should be adopting."

Much needs to be done before this happens. One of the first challenges is implementing the Government White Paper proposal to break up the State electricity supplier, the ESB.

This break-up involves removing the national grid from the ESB's ownership. The grid transmits electricity from power stations to the distribution network that gets it to customers. As it manages supply and demand, it determines which generators get to sell their power and when, which is why the ESB's competitors object to the State power company maintaining ownership.

The Government proposes to transfer the grid to another company, Eirgrid, which is already managing it. The ESB's unions oppose this and have warned that they will ultimately switch off the lights to stop it.

It is known that the company's board is not unanimous in its support for the move either. Ryan supports the move and argues that it is the logical conclusion of the existing situation, whereby Eirgrid manages the grid independently.

But how confident is he that he can implement this policy? He's already met the company's chairman and chief executive, and says he's looking forward to meeting the unions.

"I'll sit down and talk to them and listen to what they have to say and present some of the thinking of the Government to them," he says.

"But the Government's thinking is fairly clear, in the White Paper, in the Programme for Government, backed up in the Deloitte report (into the ESB) which was done last year and set out the rationale behind it."

The Minister adds that he supported this rationale in opposition. He also makes it clear that he does not think that the status quo can remain and argues that while an integrated electricity generator, grid operator and distributor was appropriate in the past, it may not be so in the future.

Ryan is firmly on the side of opening up the market, bringing in new suppliers and sources and argues that there is no reason why the ESB cannot exploit this situation and turn it into an opportunity.

"There's a real future for the ESB; indeed I can go beyond that and say that there's real opportunities now for the ESB.

"If we achieve success in this country in the area of power generation, in relation to the development of renewables [ renewable energy sources] in relation to designing a grid system that benefits renewables, I see no reason why ESB should not be part of that success."

He is understandably enthusiastic about renewable energy. Nonetheless, he has said several times that he favours having a debate about the nuclear option.

That being said, he's personally against going down this road; his party is responsible for an amendment to the 1999 Electricity Regulation Act, which makes building a nuclear plant in this State illegal. So there's no debate really then, is there?

"I believe there is a crucial debate to be had in this country," he says, "but it's looking at where this country is going to get its energy in the coming decades.

"If you look at that broad analysis, we have to ask is it wise for us to continue with 90 per cent of our energy coming from fossil fuels? How much of that can be replaced with energy efficiency? How much can come from renewables? Do we need nuclear to bridge that gap in the future?

"In a country with a grid our size, there's a real difficulty with bringing in nuclear power because the most cost-effective size for reactors today is too large for the Irish system."

But he adds that we should have that debate anyway, because it would make this clear and put the emphasis on renewables.

Another thing that could help to put the emphasis on renewables is the carbon tax that the Government is committed to introducing at some point in its lifetime. This was one of the concessions that Fianna Fáil made to the Greens as part of their coalition deal.

But when will it happen and how much is it likely to be?

"It will be up to the Minister for Finance Brian Cowen, to work out the details of how such a system would be introduced," he says. His argument is that it can be collected when fossil fuels arrive in the country and the revenues can be used to cut taxes elsewhere, so it could actually benefit the economy.

It's not just the Greens who support the plan; State-funded think tank, the Economic and Social Research Institute (ESRI), has produced what Ryan says is a a persuasive argument for its introduction, while the International Energy Agency (IEA), which recently produced a report on this country, also thinks it's a good idea.

Nobody else seems to favour it and it's pretty clear that when it does come in, it will be seen as a "Green" idea. Ryan and his colleagues are going to need plenty of political adroitness to steer through that row as well.