A new scheme designed to diversify the State’s renewable energy production and boost its chances of meeting key EU targets has been approved by the Government.
The Renewable Electricity Support Scheme (RESS) is designed to help the State meet its renewable pledges up to 2030. It’s first priority is to boost renewable energy production quickly to help turn 16 per cent of the State’s energy needs “green” by 2020.
The scheme will incentivise the introduction of sufficient renewable electricity generation by promoting investment by community groups in green projects. Offshore wind and tidal projects will be central if the State is to meet its targets, while it is expected to also support an immediate scale-up of solar projects.
Projects looking for support under the scheme will need to meet pre-qualification criteria, including offering the community an opportunity to invest in and take ownership of a portion of renewable projects in their local area.
Auction system
The RESS scheme introduces a new auction system where types of energy will bid for State support.
It is proposed that the scheme be funded through the Public Service Obligation Levy, which is a charge on consumers to support the generation of electricity from renewable sources.
Individual projects will not be capped, but the Government will limit the amount that a single technology, such as wind or tidal, can win in a single auction.
The auctions will be held at frequent intervals throughout the lifetime of the scheme to allow the State to take advantage of falling technology costs. The first auction in 2019 will prioritise “shovel-ready projects”.
"By not auctioning all the required capacity at once, we will not be locking in higher costs for consumers for the entirety of the scheme," Minister for the Environment Denis Naughten said.
In effect it should make it easier for solar and offshore wind to get investment, yielding multiple billions for green projects over the next 15 years.
2020 vision
It is hoped renewable energy will represent 40 per cent of the State’s gross electricity consumption by 2020, and 55 per cent by 2030, subject to determining the cost-effective level that will be set out in the draft National Energy and Climate Plan, which must be approved by the EU and in place by the end of 2019.
In addition the scheme is intended to deliver broader energy policy objectives, including enhancing security of supply.
“This scheme will mark a shift from guaranteed fixed prices for renewable generators to a more market-oriented mechanism [auctions] where the cost of support will be determined by competitive bidding between renewable generators,” said Mr Naughten.
The next step for the Government is to secure EU approval for the package, which typically takes six to nine months. It is estimated that the first auction will be in the second half of next year.
