There has been a growing realisation that Ireland has a significant renewable energy resource that could join agri-food and tourism as a major generator of sustainable export income. This realisation has come about in response to the need of our nearest neighbour for large amounts of electricity by 2020, in particular electricity sourced from renewable energy.
Britain’s need is partly based on a shortage of electricity due to the retirement of plants but is also based on the requirement to achieve 2020 EU targets for green energy consumption. It is expected Britain would accept up to 5000MW of Irish green energy capacity by 2020. If supplied by offshore wind, this will bring an estimated return in lease payments and taxes of well over €100 million per annum, a direct lifetime benefit of over €4.5 billion to the State. Relatively modest success in attracting elements of the supply chain for building wind farms in the Irish Sea would see a lifetime benefit approaching €10 billion.
Our wind energy resource is the largest, most competitive and most technologically developed of our renewable resources. Within this, the onshore and offshore wind sectors have quite different characteristics and costs. Offshore wind offers vast scale at sea and turbines are generally several kilometres or more offshore; at 10km from the coast, a typical offshore wind turbine will appear on the horizon at an apparent height of half an outstretched thumbnail. In contrast, onshore wind turbines offer cheaper power but are necessarily closer to people. Which of these resources should be developed first?
A number of companies, including semi-State enterprises, have identified significant wind energy resources in the midlands, which they hope to export to Britain.
Plan-led approach
Under EU law, these projects require a Strategic Environmental Assessment (SEA). The Government has stated that this SEA will then form part of a "plan-led approach" to export of green energy. Only after publication of the plan and SEA can applications be made for planning permission.
If the plan/SEA is published in 2016 and the planning permissions take another year at least, the time to construct the onshore projects and accompanying undersea cables is short if the 2020 deadline is to be met.
In contrast, about 3000MW of offshore wind energy is already well-advanced in the permitting process. The necessary offshore renewable energy development plan and SEA has also been completed.
In other words, the offshore resource is substantially ahead of the onshore resource in terms of permitting. The seven-year interval between now and 2020 is realistic in terms of getting the work done.
However, the fact that Irish offshore is years ahead of Irish onshore is not the only difference. The sales revenue and employment per unit of electricity from offshore wind will be significantly greater due to the larger budgets for installing and operating wind turbines at sea. This means that, per unit of electricity exported, more revenue comes into Ireland from exporting offshore wind. This then means the tax take and economic spin-off is greater if we export offshore wind. .
British and Irish officials are engaged in negotiations on energy policy. The Government has undertaken a cost/benefit analysis of exporting energy. This must consider the comparative benefit to Ireland of developing a resource that is both ready and delivers more benefit.
Economic advantage
The choice is simple: the onshore resource will be cheaper for Britain but with significant delivery risks, while the offshore resource will be economically better for the Irish but without the same delivery risks. It will be in the interests of both the Irish and British negotiators to signal that Irish offshore will be developed as phase 1 and onshore export as phase 2.
It is imperative that we proceed with developing our offshore resources. This approach will deliver greater economic benefits to Ireland.
Aidan Forde is a council member of the National Offshore Wind Association of Ireland