Strategies for Ireland's Renewable Energy Target

1.      Introduction

As of 2017 it is anticipated that Ireland could fall short of the renewable energy target by three percent under our current trajectory of renewable energy development. Ireland must actively apply effort in achieving the targets set out in Paris 2020 agreement and further EU renewable energy targets.

“Ireland continues to work closely with the European Commission and other Member States on developing national targets that represent a technically feasible, cost effective and fair sharing of the EU efforts to combat climate change.” (Department of Communications, Climate Action and Environment, 2018)

Decarbonising Ireland economy involves costs associated with capital infrastructure upgrades, regulation changes, making available alternative energy supplies. There is also consideration needed around informing citizens of the significant need for change and reducing energy costs and carbon emissions from homes.

Despite these challenges with decarbonisation there are significant advantages to Ireland economy in achieving EU targets. In this document we will outline those benefits and other issues related to decarbonisation.

2.      Advantages of Decarbonisation in Ireland Economy

CO2 lasts about 100 years in the atmosphere, creating a better environment for future generations is already under way.

It is becoming more widely accepted that the advantages of tackling climate change and decarbonisation more than justify the associated costs with achieving these goals. An clear benefit of decarbonisation in Ireland is the avoidance of EU sanctioned fines which could reach an estimated €600m before utilizing banked and purchased carbon credits.

Research has indicated that each benefit of decarbonisation can be linked to another – this is the concept of co-benefits. This is seen where improved air quality can improve our overall health and reduce strain on our health service. A move towards electric vehicles is creating a stronger market for manufactures whist also reducing costs for citizens and improving air quality.

Air Quality

Air Quality is considered to be one of the most important aspects of decarbonisation. This is because of the enormous benefits associated with cleaner air.

“Poor air quality also has considerable economic impacts, increasing medical costs, reducing workers’ productivity, and damaging soil, crops, forests, lakes and rivers”. (European Environment Agency, 2018)

Recent data published by the European Environment Agency indicates that Dublin, Ireland has ‘Good’ levels or air quality, which is highly encouraging.

Emerging Markets

In simple terms, as the demand for renewable energy sources increases, so too does the market for providing these services. This means that companies producing energy efficient products such as LED Lighting, Heat Pumps and Solar products for example are expected to thrive more in the current and future market. From an economic point of view this is very encouraging for those sectors.

Sustainability

Benefits such as improved air quality and increased energy efficiency. The benefits of moving away from fossil fuels to run our vehicle drive a large emerging market for electric and hybrid vehicles as far reaching in terms of economic growth and cost savings for Irish citizens.

The costs associated with renewable sources such as wind and solar are reducing continually, which counteract the capital investments required to develop these sources of energy. Further benefits are realised by the reduced costs and reliance on depleting fossil fuels.

3.      Government Efforts

In an effort to achieve Ireland’s goals around decarbonisation the Government has set out a number of initiatives.

3.1. Implementing a Single Electricity Market in 2007

The Single Energy Market combined the North and South of Ireland into one shared source and market for electricity. This is was significant structure change to the market in Ireland when introduced in 2007.

Aside from being successful in reducing energy prices for consumers and opening a more competitive market place there is a substantial focus on the environmental benefits of this agreement.

Two main points from the memorandum between Ireland and the UK state:

1. facilitate the participation of renewable energy generators in the market;
2. take into account the operation of arrangements in relation to the environment;

(SEM Memorandum, 2007)

3.2. Implementing part L in building regulations

The Part L requirements under the building regulation have drastically improved the way in which new buildings are constructed – placing an emphasis on reducing the energy required to construct and operate new and existing buildings in Ireland.

The trend on BER Ratings since the regulations were introduced in 2007 has been very encouraging.

Additionally, Part L is be refined further to meet the near zero energy building requirements of the European Energy Performance of Buildings Directive.

3.3. Publishing new policy frameworks

Produced by the Department of Communications, Energy & Natural Resources, the National Energy Efficiency Action Plan (NEEAP) set about ways to further promote energy monitoring and accountability in the commercial sector.

These provide comprehensive plans on how we can reach the EU renewable energy and energy efficiency targets. A number of compliance and legislative requirements have been set in place as a result of this including Building Energy Rating Certificates and Display Energy Certificates, in an effort to reduce energy consumption.

3.4. Business Incentives

There are multiple benefits for businesses investing in energy efficiency. Energy efficiency helps businesses to cut costs through energy savings.

SEAI launched the Better Energy Workplace scheme in 2012 as a means of assisting companies (through the use of grants) to invest in upgrading assets to reduce energy consumption. The author took place in the delivery of such a project where LED Lighting and heating systems upgrades took place in a building in Dublin city. SEAI Contributed €50,000 to the overall project. 

SEAI also launched (in March 2018) the SME Smart Lighting program. This program supports businesses in upgrading their lighting to more energy efficient systems. Upgrading lighting can result in businesses reducing their electricity costs by up to 90%. 

Such government initiatives not only help businesses operate at a lower utility cost and reduce CO2 emissions, but also create a more comfortable working environment for staff.

4.      Impeding Factors to reduce emissions

There remain a number of factors that impede on the progress of reducing overall carbon emissions in Ireland.

4.1 Financial Costs

In order for a successful adoption by citizens and other major groups, it is essential that a viable alternative is available. For that to happen there is a continuous need for investments into renewable energy sources by the Irish Government.

 “The uncomfortable fact is that the costs of abating emissions of CO2 must be incurred today or in the near future if the goal of the Paris Agreement”. (London School of Economics, 2017)

The investment cost element to decarbonisation must be considered in light of funding issues affecting our healthcare and schools.

4.2 Agriculture Sector buy in

The agricultural sector in Ireland is a major participant in the use of the Irish rural environment for commercial purposes. Traditionally the Agri-sector has not been forthcoming in support of the countries Climate Change Initiative.

“Bovine methane emissions and ammonia from slurries and fertiliser production and its use are some of the largest emitters of greenhouse gasses in Ireland. In fact, Ireland’s Agri sector is responsible for almost 20 million tonnes (MT) of CO2 equivalent greenhouse gasses out of Ireland’s current total of 60 MT.” (Tipperary Energy Agency, 2017)

Calculations from the Department of Finance and Institute of International and European Affairs (IIEA) suggest there will be a possible cost of €600 million per annum after 2020 if there is no change in policy (Irish Times, 2018).

Therefore gaining the support of the agriculture industry is a significant challenge that must be overcome in Ireland.

4.3 Continued policy support 

In order achieve the targets set out by EU and Irelands energy own targets it is clear that a change in our Government policies are necessary.

From the Governments perspective, its citizens and its industries are being asked to incur the costs of reducing CO2 emissions today in return for future benefits that are themselves uncertain. “This is a hard sell to taxpayers and large emitters today.” (London School of Enonomics , 2017)

Coupled with the strong standing of the Agriculture sector in Ireland it can be expected that policy changes are likely to be challenged and in some cases scrapped before being implemented.

Other barriers

A number of other barriers impede the success of decarbonisation;

• Effective communication with Irish Citizens of the benefits of utilizing renewable energy sources
• Innovative solutions to energy storage and demand side management to address continuity and availability of renewables such as wind and solar
• Grid infrastructure and interconnection upgrades is a challenge that involves local planning permissions, construction costs and other factors.

5.      How the EU is helping

The EU is helping with decarbonisation by driving the EU Emissions Trading System and Carbon Tax systems.

This works by tackling the big CO2 emitters of the industry including power generation, oil refiners and industries that produce steel and cement for example.

As we are currently in phase 3 of the ETS system, we are seeing the EU reduce the number of ETS credits available on the ‘market’.

This cap and trade system means that at the end of the year, a company must surrender enough credits to cover the amount of CO2 produced, and pay fines for any additional emissions. Spare credits that are built up can be sold to poor-performing companies at a profit.

This EU initiative has been instrumental in forcing the highest CO2 producers to seek a low-carbon solution for their operations.

6.      Further Steps to Accelerate Decarbonisation

The author would consider a number of factors to further accelerate decarbonisation in Ireland.

Incentivise the public and private sectors towards renewable energies such as solar and heat pumps. Tax incentives for the installation of renewable energy solutions in the domestic market would help drive this.

The obligated parties’ scheme has proven to be very successful.

Electric Vehicles

The Irish Government may also experiment with harder measures to wean motorists off their dependence on the internal combustion engine. The potential cost savings available by switching to electric are promising for Irish consumers:

”Recently, France and the UK announced plans to ban new petrol. The UK has announced plans to ban new petrol and diesel cars from 2040 and diesel cars from 2040” (ThinkBusiness.IE, 2017)

Bibliography

• CSO, 2017. [Online] Available at: https://www.cso.ie/en/releasesandpublications/er/dber/domesticbuildingenergyratingsquarter12017/
• Department of Communications, Climate Action and Environment, 2018. [Online] Available at: https://www.dccae.gov.ie/en-ie/energy/topics/Renewable-Energy/decarbonisation/Pages/2030-Landing-Page.aspx
• European Environment Agency, 2018. [Online] Available at: https://www.eea.europa.eu/articles/cleaner-air-benefits-human-health
• Irish Times, 2018. [Online] Available at: https://www.irishtimes.com/news/environment/irish-farming-under-pressure-to-reduce-carbon-emissions-1.3527011
• London School of Enonomics , 2017. [Online] Available at: http://www.lse.ac.uk/GranthamInstitute/news/economic-co-benefits-of-reducing-co2-emissions-outweigh-the-cost-of-mitigation-for-most-big-emitters/
• SEM Memorandum, 2007. [Online] Available at: https://www.dccae.gov.ie/documents/SEM%20Memorandum%20of%20Understanding.pdf
• ThinkBusiness.IE, 2017. [Online] Available at: https://www.thinkbusiness.ie/wp-content/uploads/2017/09/Electric-cars-in-Ireland-white-paper.pdf
• Tipperary Energy Agency, 2017. [Online] Available at: https://www.thinkbusiness.ie/articles/green-farming-ireland/