Government approves key design features of first Renewable Electricity Support Scheme (RESS) auction
30% Increase in Renewables Expected in Round One
The Minister for Communications, Climate Action and Environment, Richard Bruton, T.D. today (Monday the 2nd of December) announced details of the first Renewable Electricity Support Scheme (RESS) auction which has received Government approval.
The Climate Action Plan, published in June of this year, is the Government's plan to give Irish people a cleaner, safer and more sustainable future. The Plan sets out actions across every sector which will ensure we meet our future climate commitments. A key part of the Plan is a move to 70% renewable electricity by 2030.
Minister Bruton said:
"Ireland is currently 86% reliant on fossil fuel. We must radically reduce this dependence and make the transition to cleaner, more renewable energy.
"We are exiting from peat and coal to generate electricity and moving to clean, renewable sources of power, like wind and solar. The Renewable Energy Support Scheme is a flagship Government policy designed to deliver on our commitments to decarbonise our electricity grid, harness our natural resources and bring renewable energy into the heart of our communities.
"Today, I am announcing the details of the first auction under the Scheme. Installed wind capacity has grown by 50% since 2015. This auction could see capacity grow further by 30% in the next three years, with solar and community participation. This is the equivalent of powering up to 640,000 homes every day and will have a significant impact on delivering what we set out in the Climate Action Plan."
The Renewable Electricity Support Scheme (RESS) is an auction-based scheme which invites renewable electricity projects to bid for capacity and receive a guaranteed price for the electricity they generate.
The Government has agreed the proposed elements of the Scheme, which subject to state aid approval, will make up the first auction set to open next year.
- Increasing Technology Diversity The Scheme will be open to a range of technologies that will broaden the renewable energy mix and enhance security of supply.
- Solar The Government has approved the inclusion of a solar category, subject to state aid approval, which would represent approximately 10% of the overall auction
- Community led category The Government has approved the inclusion of a community category within the auction, subject to state aid approval of up to 30 GWh
- Community Participation: An obligatory community benefit fund scheme will provide opportunities for communities to play their part in Ireland's renewable energy transition
The first auction is set to open early next year, subject to State Aid approval and will deliver up to a 3,000GWh increase in renewable electricity generation by the end of 2022.
Every project developer will be obligated to contribute to a Community Benefit Fund at a rate of €2 per Mega Watt hour (MWhr) every year. This will generate a minimum amount of up to €6m for communities living in close proximity to renewable projects each year.
The RESS will also mandate that Irish citizens or communities will have access to investment opportunities in renewable energy projects, prioritising those citizens that live in close proximity to the projects. The Minister expects to announce further details on this aspect in the New Year.
Minister Bruton said:
"I am keen that communities where renewable energy projects are being built are included in the project's development. The Government have agreed to make this a strong element of the Scheme. I am pleased to confirm that work on the establishment of an enabling framework to support community projects and participation is well underway and will intensify in the New Year"
Further information is available on the RESS page on the Department's website. The draft terms and conditions of the first Renewable Electricity Support Scheme will be published in mid-December for a five-week consultation.
Notes for Editor
The Renewable Electricity Support Scheme is still subject to EU state aid approval.
The RESS is a product of both independent economic analysis and public participation and consultation. Across two public consultations, over 2,000 submissions were received and considered. The development of RESS has also included an in-depth review of international best practice, across Denmark, Germany, Canada and Scotland; world leaders in community-led renewable electricity projects.
The frequency of future RESS auctions is dependent on the renewable electricity project supply pipeline. It is envisaged that a minimum of four auctions will occur between 2020 and 2027 to deliver on the 2030 targets. This will provide pathways for renewable developers including offshore wind projects as it sets out the indicative timelines and volumes for auctions over the coming decade and provides clarity for developers in relation to when they need to have their projects 'auction ready'. It will also allow Ireland to take advantage of new technologies as they emerge.
Increasing Technology Diversity
As renewable technologies such as offshore wind mature and costs decrease, Ireland will be able to take advantage of falling costs of technology throughout the next decade, which in turn will lead to greater diversification of its renewable portfolio.
Community Enabling Framework
There are several pillars to the community framework which include:
- Community Benefit Fund (CBF)
A mandatory Community Benefit Fund must be provided by all projects successful in a RESS auction. The contribution is to be set at €2/MWh. The Fund will be aligned to incentivise investment in local renewable energy, energy efficiency measures and climate action initiatives.
The RESS will mandate that Irish citizens or communities will have access to investment opportunities in renewable energy projects, prioritising those citizens that live in close proximity to the projects.
The Community Framework is in essence an enabling framework to encourage the development of a meaningful community electricity generation sector. Measures included within this framework will consist of:
- Financial supports including grants and soft loans
- A trusted intermediary network to work with communities through the various stages of projects
- A trusted advisor network to be available to them to give them specialist advice such as legal and financial.
- A trusted information source for a variety of "how-to" information guides.
- A central point of contact organisation to co-ordinate all of these enabling services