The crop energy sector has received a major boost with the announcement of a scheme which will pay 50 per cent of the cost of planting elephant grass and willow for bio-mass. The cost is estimated to be €3,000 per hectare.
Minister for Agriculture Mary Coughlan also announced an €80-a-hectare top-up payment to support the growing of these energy crops. This will supplement the existing €45-a-hectare European Union grant.
She said that €8 million was being allocated over the next two years for the grant scheme to grow crops suitable for use as a renewable source of heat and energy. The scheme was being piloted this year and would allow up to 1,400 hectares of miscanthus and willow to be grant-aided in the first 12 months. Under the scheme, farmers can now receive up to €1,450 per hectare towards establishing the crops.
Explaining the €80 per hectare top-up to the existing €45 per hectare EU payment, Ms Coughlan said that this new €125 payment would apply for three years and would be subject to a maximum ceiling for each producer over three years. The current maximum area for which farmers could be paid this grant was 37.5 hectares, but she would attempt to have this ceiling raised.
Irish Farmers' Association president Pádraig Walshe said that the announcement of bio-mass energy crop incentives was a welcome start to developing a renewable energy sector. "Farmers are committed to producing energy crops, but the cost of establishment has been prohibitive and the return on investment has been negative," he said. "Today's announcement is a signal of the Government's intention to promote a renewable energy sector through the incentivising of energy crops."
The IFA had long argued that farmers and agriculture could play a pivotal role in meeting the State's commitments under the Kyoto Protocol and the EU bio-fuels and bio-mass directives, Mr Walshe said. "A 50 per cent establishment grant coupled with the €125-a-hectare energy payment will encourage farmers to look at producing willow and miscanthus [ elephant grass] crops," he added.
The IFA's bio-energy project team leader, J.J. Kavanagh, said that Ireland had a disproportionate dependency on imported fuels at more than 90 per cent, compared with the EU average of 50 per cent. The aim was to lower this to 30 per cent.
"Ireland's reliance on energy imports is not a secure position for our economy and neither is it environmentally sustainable in the context of climate change and global warming," Mr Kavanagh said.
There has been a growing interest in the energy crop sector here since the closure of the sugar beet industry and the rise in the price of crude oil. The grants are expected to stimulate this further.