UK/Ireland initiatives to help Ireland meet targets

Garret Farrelly explains how UK-Irish co-operation can help the State to achieve its 2020 targets.

The RES Directive (Directive 2009/28/EC) sets a mandatory national target for 16 per cent of the overall share of Irish energy to come from renewable sources by 2020, in gross final consumption of energy. Ireland’s National Renewable Energy Action Plan (“NREAP”) sets a target for 40 per cent of Irish electricity consumption to come from renewable sources by 2020.

Currently, Ireland has about 1.4GW of wind capacity installed and a further 4GW of wind projects are currently in development in the Gate 3 grid connection process. However, a further 4.7GW is required to meet the 2020 target. Minister Rabbitte told the 2012 IWEA annual conference in Dublin that Ireland was 630MW behind where the NREAP had outlined we should be in 2012 and said that Ireland’s target will not be achieved without an increase in wind energy build from an historic average of 180MW per year to at least 250MW per year.

Failing to ensure that our 2020 targets are met is significant for taxpayers as it could lead to non-compliance costs of up to €150 million per year, for each percentage shortfall in renewable energy, and a further €250 million in emissions permit purchases. Therefore, the timely development of a healthy pipeline of wind projects is essential if Ireland’s 2020 renewable electricity targets are to be achieved.

The RES Directive sets out the framework for three co-operation mechanisms (statistical transfers, joint projects and joint support schemes) which member states may use to achieve their own 2020 targets or assist other member states in achieving theirs.

Under the auspices of the British-Irish Council, the Irish and UK governments have been working together to create the framework and conditions for renewable energy export under the co-operation mechanisms under the RES Directive. This led to Ireland and the UK signing a Memorandum of Understanding on

24 January this year where both governments agreed:

• to consider how Irish renewable energy resources, onshore and offshore, might be developed to the mutual benefit of Ireland and the UK; and

• to consider an inter-governmental agreement between the two governments regarding joint projects with electricity flow to the UK market and the possible opportunity for statistical trading.

On 31 July 2013, the Minister for Communications, Energy and Natural Resources (“the Minister”) announced that he had instructed his officials to develop an overall policy and planning framework in order to guide An Bord Pleanála when it was considering proposals for wind energy export projects.

The Minister explained that the framework, which will be based on a Strategic Environmental Assessment, will be prepared over the coming 12 months. The purpose of the framework is to provide an opportunity for all stakeholders, including local authorities, potential project developers and local communities, to be consulted and to participate in the development of a national policy for wind export.

The Minister pointed out that the development of a new national framework will enable Ireland to integrate relevant EU Directive requirements, particularly under Council Directive 92/43/ECC (the “Habitats Directive”). The Minister also advised that any renewable energy export strategy would depend on the conclusion of an inter-governmental agreement that would ensure that such exports were in the interests of both Ireland and Britain.

The progress of the inter-governmental agreement and the framework will be watched closely by industry in Ireland.

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Garret Farrelly is a Senior Associate with Matheson’s Energy and Natural Resources practice and advises on all aspects of projects, ranging from PPPs and regulatory matters to energy and natural resources projects as well as M&A and project financing, with a particular focus on renewable projects. You can phone Garret on +353 (0)1 232 2074 or email him at garret.farrelly@