Latest news with #Nesc
Irish Times
30-07-2025
- Business
- Irish Times
Costs holding back Ireland as a renewables exporter, Nesc warns
Ireland's ambition to become a big net exporter of renewable electricity 'risks being undermined unless policymakers act swiftly to address cost competitiveness challenges', the National Economic and Social Council (Nesc) has warned the Government . In a report published on Wednesday, the independent think tank highlights Ireland's growing vulnerability due to being 'the most fossil fuel import-dependent countries in Europe ... exposing households and businesses to price volatility on international markets and geopolitical risks'. This includes having no existing gas reserve. The Ukraine war and Middle East conflict underline the need for strategic energy reserves 'to act as a buffer' should a prolonged disruption to international energy supplies occur, it says. In addition, 'unless reliance on imported fossil fuels is dramatically reduced, Ireland risks worsening climate change and substantial EU fines'. READ MORE The report recommends 'redirecting fiscal resources away from inefficient fossil fuel subsidies to accelerate the energy transition and shift economic incentives toward investment in renewables'. It highlights risks facing Ireland's subsea energy infrastructure, notably gas pipelines and electricity interconnectors with the UK, which are 'vulnerable to hybrid warfare attacks such as physical sabotage and cyberattacks'. This is in a scenario where the Defence Forces 'have limited access to real-time satellite surveillance'; insufficient maritime patrol capability and has 'consistently operated below their target personnel levels'. In addition to a State-led strategic gas emergency reserve, it calls for 'a long-term national plan for strategic clean energy reserves based on zero-carbon fuels such as green hydrogen and biomethane'. Green hydrogen generated from renewable energy, however, is likely to be prohibitively expensive unless economies of scale are achieved exceeding domestic demand, it concludes, and backed by partnerships with large economies such as Germany , the Netherlands and Belgium . 'Without guaranteed export pathways and demand certainty, green hydrogen risks becoming another stranded asset,' it adds, but 'given our considerable natural endowments in the offshore wind sector ... Ireland could play a strategic role in future as a producer and exporter of hydrogen'. [ Industry and environment groups unveil plan to accelerate renewable energy Opens in new window ] In examining how energy trade is likely to evolve as Ireland moves away imported fossil fuels, Nesc outlines challenges within 'a more complex and interdependent European energy system' based on renewables. 'The energy transition will not insulate us from developments beyond our borders,' said Nesc policy analyst Dr David Hallinan. 'Ireland is an island – but we're part of a European energy system. The international trading environment and domestic energy system will remain deeply intertwined. To lead in clean energy, we need to invest strategically, contain costs and work more closely with our neighbours.' Electricity exports from Ireland have fallen in recent years, while imports have surged mainly due to cheaper electricity from Britain. With the Celtic interconnector with France becoming operational in 2026, availability of cheap electricity imports will increase further, it says. Ireland's electricity is more expensive due to a combination of factors, including heavy reliance on natural gas; grid bottlenecks, geographic isolation and absence of nuclear power. To counter this, the report calls for strategic focus on maximising domestic use of Ireland's vast renewable energy resources to achieve strategic resilience; industrial decarbonisation, and meet legally-binding emissions reductions. Dr Hallinan added: 'Ireland must not view itself in isolation. Our energy future is European, and it must be built on shared planning, shared investment and shared ambition. We will remain deeply interdependent through trade in electricity, trade in zero-carbon fuels, transnational infrastructure and trade in renewable energy technologies.' The race to become a global leader in renewables trade will not be won on policy ambition alone, he said. 'There are real concerns about the slow pace of energy infrastructure delivery. Projects to expand the grid, develop offshore wind farms and upgrade port infrastructure are moving too slowly.' Future investment decisions, Nesc says, must be supported by European frameworks for joint planning and cost-sharing, backed by partnerships with countries with big demand for renewables. 'These mechanisms are vital to ensuring Ireland's renewable energy exports can be sold into European markets competitively and reliably,' Dr Hallinan said. 'We must address the root causes of high domestic electricity prices. Our ability to export clean energy will depend on how effectively we address these fundamentals.'
Irish Times
25-04-2025
- Business
- Irish Times
‘Impossible' to achieve a net-zero economy by 2050 and transition to clean energy could push up electricity prices
It could be described as a ferocious, quick-fire double punch. The target? The critical players leading Ireland's clean energy transition over coming decades and pursuit of the Holy Grail, a net-zero economy by 2050. The rude awakening, in effect, poured scorn on big talk that it's simply a matter of time before Ireland becomes 'the Saudi Arabia of wind '; exporting vast quantities of electrons to power mainland Europe. First came an unusually outspoken report from the National Economic and Social Council (Nesc) released on Good Friday afternoon, saying Ireland's policy on the transition to green energy lacks clarity, with stakeholders not on the same page from a strategic standpoint. We may have 'a unique energy advantage in Europe', yet questions about how the transition will be made remain unanswered and, perhaps most damning, 'much of Ireland's policy action for transition in the power sector is headed into fog'. READ MORE Second came the verdict this week of the Irish Academy of Engineering (IAE), an all-island think tank, declaring energy policy needs to 'go beyond wishful thinking and to be replaced by the realities of engineering, finance and project delivery'. Its cold assessment of available technologies suggests it is impossible to achieve the legal requirement and policy objective of climate neutrality by mid-century. And there is an absence of a plan, as it sees it, to deliver 352 essential, large energy infrastructure projects. Key questions about renewable energy capacity requirements, the rationale for surplus power generation, its optimal use, price competitiveness and the method of energy export remain unanswered — National Economic and Social Council These range across onshore and fixed-bottom wind offshore, solar, interconnectors, transmission lines, battery storage and backup generation. It includes 'many hundreds of kilometres of overhead transmission lines'. The absence of hydrogen and floating offshore technology is notable – though it does not dismiss them as non-runners. Those most responsible for the transition and associated infrastructure development are the Government (including key departments delivering policy and dictating market conditions), ESB , EirGrid and the Commission for the Regulation of Utilities . As there is a national mandate to accelerate the scale-up of renewables, other State agencies are in the mix, ranging across planning (especially marine), enterprise and local development. While the finger of blame was not directed at any single actor, collective responsibility could not be clearer, as 'visibility and certainty are low' across the board – as Nesc put it. Easter break aside, none has disputed the withering assessments. Nesc detailed failings and gaps that risk a lack of action on transition to clean energy that will add costs for Ireland – that also runs contrary to the narrative foreseeing lots of cheap renewables. 'There is a lack of evidence-based certainty about future energy prices in Ireland and, if anything, consumers might expect higher rather than lower energy costs as the transition progresses. This is despite the cost of renewable power production being competitive with that of fossil fuels over the long term.' Compounding matters are issues about future reliability of the country's energy supply. This may undermine national competitiveness and the transition narrative 'with an absence of actions to reinforce both the energy transition and economic resilience'. Nesc identifies four primary risks. On electricity supply, it warns reliability may worsen over periods of the transition if not addressed. There is 'no clear visibility of the power system's reliability beyond 2032'. Clarity is needed on total system cost of transition in the power sector and the distribution of those costs, while 'key questions about renewable energy capacity requirements, the rationale for surplus power generation, its optimal use, price competitiveness and the method of energy export remain unanswered'. On enterprise opportunities, it says 'there is no single, comprehensive estimate available to policymakers of the sales, exports and jobs, etc that can be expected from delivering transition targets'. The IAE pulls no punches on energy reliability and security. It questions the feasibility of decarbonising the electricity sector and wider energy sector by 2050, given 'an unavoidable dependence on natural gas' that will still apply then and maybe beyond. Much of its concerns relate to ensuring power supply when demand will increase from 34 terawatt hours (TWh) in 2024 to 80TWh by 2050. It also highlights vulnerability to possible disruptions to the supply side of natural gas due to heavy reliance on it as the energy source of last resort for electricity generation. The Government's move to create an offshore LNG reserve to address security of supply risk is inadequate both in terms of storage capacity and infrastructure. 'A small, leased floating storage regasification unit operated to not impact on the operation of the market is unlikely to be sufficient,' says IAE energy and climate action committee chairman Eamonn O'Reilly, the former head of Dublin Port. Ireland is an island with no indigenous energy sources that can provide the energy security the country needs, he adds. 'Renewables can supply a lot of energy but need backup to ensure reliability of supply. Because renewables cannot get over the first hurdle of reliability, they cannot provide energy security. In 2024, Ireland's near 5,000 megawatts (MW) of wind provided less than 500MW of power for 2,127 hours' – equivalent to 88 days over a year. 'No amount of oversupply of renewables can guarantee power when the wind and sun are not sufficiently available, not even Government's enormous 2050 target of 54,000MW. There will always be a requirement for alternative backup power sources to ensure reliability.' Similar concerns apply to interconnectors, the IAE says. In 2024, 15 per cent of the country's electricity requirement was met by imports. 'The need for energy security suggests Ireland should have a low, or very low, ultimate dependence on interconnectors because we have no control on the supply that might be available when we need it most.' O'Reilly accepts there are many complexities in the transition feeding into their position, which is not advocating rowback – 'it is not climate denial; we are not saying don't do renewables'. [ Why international firm Corio withdrew from plans for Sceirde Rocks wind farm off Connemara's coast Opens in new window ] The IAE backs 'an inevitable compromise on net zero by 2050 ... but you can never predict the future. You can only plan on the basis of the technology you have today. So you can't get to net zero by 2050. No way.' Despite this, it still backs moves to maximise renewables while 'other technologies that could become available over the next 25 years include floating offshore wind, hydrogen and small modular nuclear reactors'. Those advocating hydrogen and floating, including the ESB, should get their act together and even proceed to planning 'and see where it goes', he says. 'But you can't rely on hydrogen and floating to get us to net zero by 2050. If we over-rely on that you might find you can't power the country.' Government has set a target to achieve a climate-neutral electricity system by 2050 – and accepted the imposition of enormous financial penalties by the EU if this objective is not achieved – 'without first understanding and demonstrating how it is feasible', he says. Echoing Nesc concerns, O'Reilly notes 'this has been done without estimating how much the endeavour will cost and what impact it will have on the already high price consumers pay for electricity in Ireland'. Taoiseach Micheál Martin said the Nesc findings would inform the future approach to the energy transition. Previously, the Coalition decided to establish a new infrastructure unit within the Department of Public Expenditure and Reform in tandem with reforms to tackle regulatory barriers impeding growth and development. There are many in the renewables sector who believe his response is acknowledgment that the Government needs to be more rigorous and strategically coherent. [ Irish electricity prices, already Europe's highest, may rise further due to 'required investment' Opens in new window ] 'The scale of resources needed to deliver a secure and stable green energy system means that we must accelerate investment, both public and private,' Martin said. He announced a new 'climate investment clearing house' to accelerate progress and to work with all stakeholders 'to ensure we have the conditions in place to achieve this energy transformation in an effective, timely and sustainable manner, while ensuring the ongoing competitiveness of the Irish economy'. He is to host a joint Government-industry forum on offshore renewables in coming weeks, 'to scope out the role of the clearing house and how we can best progress delivery of Ireland's offshore renewable energy objectives'. The cross-department Offshore Wind Delivery Taskforce in place since 2022 includes key State agencies, but industry sources say they could be more involved, particularly in bringing solutions to the table. Nobody questions the Department of the Environment, Climate and Communications ' determination to deliver, along with that of the ESB and EirGrid, but they contend a robust mechanism to ensure accountability in other agencies is largely absent. [ Take fewer flights or switch to an EV – what's the best way to reduce my carbon emissions? Opens in new window ] Ireland aims to transform its power system over the next 25 years by reducing fossil fuel use and ramping up renewables, accepting this is key to addressing climate change . They may be brutally frank in tone, but neither report is saying 'we shouldn't be doing this'. Nesc recommends a phased approach to drive progress. Immediate actions include 'improving conditions for clean energy infrastructure (planning, skills, financing, grid and supply chains) and establishing new institutional arrangements for better co-ordination'. [ Ardnacrusha at 100: What could happen if Ireland showed similar ambition today and invested 20% of national budget in energy? Opens in new window ] Next should be moves 'to address key knowledge gaps, to demonstrate sustainable renewable power demand, and to ensure economic benefits are realised domestically'. In the longer term is a need 'to produce competitively priced energy for export, to develop export methods and to manage associated challenges, if proven practical and viable'. Ireland's decarbonisation potential includes ability to meet all, or almost all, of our power demand from renewable energy sources – to reach 'domestic net-zero emissions', Nesc concludes. There is also the prospect of producing surplus clean energy, it says, to power enterprise and spur new opportunities – and to export surplus clean energy – if proven practical and viable. Nesc analyst Dr Cathal FitzGerald, however, said its research reveals uncertainty about the impact on our economic resilience in terms of energy reliability, price, jobs and exports. 'These in turn highlight broader issues to be resolved and a strong imperative for action.' The energy transition must be progressed despite all the complexities involved, he underlined, while being mindful 'the cost of inaction would be enormous and devastating'.
