The Irish Department for Communications, Energy and Natural
Resources (the "Department"), the government department
having responsibility for energy policy, has published a welcome
update in relation to the status of the main public support scheme
for renewable energy projects in Ireland.
Since 2006, the main form of support that is available for the
development of such projects has been a feed-in tariff scheme known
as "RE-FIT". Payments under the scheme are made to
the purchasers of electricity from participating renewable
projects, in order to provide a hedge against the higher costs
associated with the generation of electricity from renewable
sources.
The rules of the RE-FIT scheme were published by the Department in
2006 and received European Commission state aid approval in
September 2007, and the first tranche of eligible projects were
admitted to the scheme – by way of the publication of a
statutory instrument – in July 2008.
According to the terms of the state aid approval that was granted
to the RE-FIT scheme, participation was limited to generating
capacity of 1,450MW. By contrast, it has been estimated that the
installed capacity of Ireland's fleet of connected renewable
generators will need to reach approximately 5,800MW by 2020, in
order to achieve the production of 40% of Ireland's electricity
consumption from renewable sources – which is the current
Irish government target.
By late 2008, approximately 1,300MW of renewable generation had
been connected in Ireland, meaning that:
(a) additional renewable generation having an aggregate
capacity of 4,500MW would be required in order to meet the 40%
target; and
(b) due to the scheme's 1,450MW capacity limit, RE-FIT
support would not be available to all such projects.
It has therefore been clear for some time that in order for Irish
government support to be available for enough renewable capacity to
meet the 40% target, an extension of, or replacement to, the
original RE-FIT scheme would be required.
The latest iteration of the Department's "RE-FIT" web
page: www.dcenr.gov.ie/Energy/Sustainable+and+Renewable+Energy+Division/REFIT.htm now
clarifies the status of a number of separate state aid applications
that have been made by the Department to the European Commission,
in respect of further tranches of RE-FIT support.
In particular, the web page now refers to:
(a) "RE-FIT 2" – a scheme intended to
cover small and large scale onshore wind, biomass landfill gas and
hydro projects; and
(b) "RE-FIT 3" – intended to cover certain
categories of biomass generating technology, including anaerobic
digestion and combined heat and power.
The Department also notes on its web page that "separate state
aid applications will be required for additional REFIT categories
of offshore wind, wave and tidal energy" - although the
announcement does not make it clear whether or when the Department
intends to make any such applications.
The proposed terms and conditions of eligibility for support under
RE-FIT 2 and RE-FIT 3 have not yet been published, and in any event
are likely to be subject to the terms of any state aid approval
that is ultimately forthcoming from the European Commission.
However, the inclusion of these details on the Department's
website provides welcome confirmation that further support for
renewable electricity generation in Ireland is in an advanced stage
of planning.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
