Electricity consumers could see a future reduction prices following the announcement of new supports for wind power which could unlock around €4 billion in private investment.
To complement the new regime announced today, Minister for Energy Eamon Ryan today also revealed that a plan to build an offshore electricity network for wind power is being considered by the Government.
He said his department had already begun work with counterparts in the North and Scotland on a proposal to develop an off-shore grid beneath the Irish Sea connecting the countries' wind farms.
Around six per cent of Ireland's electricity generation comes from wind but one of the problems with this type of power is that supply is inconsistent and the technology for storage requires further development.
But Denmark has overcome the problem by connecting to the European electrical grid giving it an outlet for excess power while allowing it tap into the grid for electricity when its wind resources are low.
Mr Ryan said extending the proposed grid under the Irish Sea to connect with the European grid would allow for the production of wind-generated electricity "on a consistent and predictable basis".
"If we can connect and integrate wind farms from other jurisdictions, electricity will be produced wherever the wind is blowing."
He said Ireland must reduce its reliance on fossil fuels for economic and environmental reasons with renewable electricity sources a cornerstone of Government policy.
"Ireland has one of the finest renewable energy resource potentials in the world," the minister said.
Last month, he unveiled a study on the potential for renewable energy use which found that Ireland could exceed by nine per cent the existing target of 33 per cent by 2020.
However, investment of over €9 billion would be needed in the transmission network.
Today he announced an extension of the renewable energy feed-in tariff scheme (Refit) guaranteeing €140 per kilowatt hour generated by offshore wind power. The scheme is due to last 15 years.
He said price supports were needed to encourage commercial and private investors.
"The support price is in line with what other countries are offering and without it we would not be able to attract any investment into Ireland. Now, investors can be confident when they invest in offshore wind.
He expressed the hope that larger scale projects could be developed as a result of the initiative.
The National Offshore Wind Energy Association of Ireland (NOW Ireland) said its members could now plan for deploying up to 2000 megawatts of capacity from existing lease areas in Irish waters. This equates to around a third of Irish electricity needs.
Spokesman Torben Anderson said: "The total investment in the initial phase of deployment could potentially reach €4 billion."
He also denied that renewable energy could lead to an increase in costs to the consumer saying developing technology and guaranteed prices was making wind power cheaper while fossil fuels were likely to remain prone to price spikes.
Wind power would also be an important element of the strategy to reduce Ireland's carbon emissions.
Chief executive of the Irish Wind Energy Association (IWEA) Michael Walsh said today's announcement was "an important step on the road" to the Government's renewable energy targets.
Investors were "looking forward to the delivery of the substantial network infrastructure that will be needed to allow growth of our renewable wind energy resource" he added.