The Ireland Strategic Investment Fund (Isif) will earmark some of its cash to develop biogas, a fuel made from farm waste.
The State-owned fund has allocated €1 billion for investment in climate-related businesses, one of four areas that it targets, along with agriculture, housing and indigenous business.
Cathal Fitzgerald, its senior investment director, food and agriculture, said on Tuesday that it would earmark some of that €1 billion for biogas — or biomethane — projects.
“We are seeking to kick-start or support that sector,” said Mr Fitzgerald. He added that the Isif had an “active pipeline” of projects.
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The Government wants biomethane to provide 10 per cent the Republic’s gas needs by 2030.
Mr Fitzgerald was speaking after a conference organised by Gas Networks Ireland focused on providing information for biomethane producers.
He explained to the audience that the fund typically backed projects alongside private-sector investors.
Russell Smyth, accountant KPMG’s head of sustainable futures, said there was a wall of capital waiting to invest in industries such as biogas production.
A process called anaerobic digestion converts manure and farm waste to biomethane, which can replace fossil fuel natural gas.
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As well as providing fuel for heating, biomethane helps cut agriculture’s greenhouse gas emissions.
Meeting Government targets would require between 150 and 200 anaerobic digesters to be up and running by 2030.
Farmers in Northern Ireland are already exploiting opportunities that the technology provides, but Mr Smyth noted that industry in the Republic needed a kick-start.
He cautioned that projects would likely have to rely on equity rather than on debt, as banks were slow to lend to the industry.
Mr Smyth said that the UK Green Bank invested in biogas production in the North. “Then infrastructure funds crowded in alongside the green bank,” he added.
He suggested that the Isif could have a similar “mobilising” effect on the industry in the Republic.
Mr Smyth also noted that the renewable heat obligation, which takes effect from 2024, could help create industrial customers for biogas.
Speaking after the conference, Mr Smyth calculated that it would take about €1 billion to fully develop the Republic’s biogas industry.
Unlike wind and solar power, the State has no plan to subsidise biogas production. Mr Smyth maintained that this required the industry to “miss a step” on the road to its development.
Karen Doyle, head of business development, Gas Networks Ireland, told the conference that many of the State company’s customers had expressed interest in biomethane.
