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Speech by Minister Denis Naughten at the Opening of the All-Island Brexit Civic Dialogue on Energy

Monday 6 February 2017, King House, Boyle, Co. Roscommon

 

[Check Against Delivery]

 

Let me start by welcoming you all here to King House in Boyle County Roscommon. 

 

We are here today to discuss the most significant economic and social challenge of the past 50 years. Brexit will impact our economy and society due to the close links between Ireland and the UK. It has implications for everyone on this island – North and South.

 

One of the key links between Ireland and the UK is – of course – energy. Ireland imports most of the energy we use and the UK is \ key conduit for much of this energy. In addition, we have many close energy links between Ireland and Northern Ireland. The most notable of this is the Single Electricity Market across the island of Ireland. 

 

I think it is fair to say that the energy relationship Ireland has with the UK is unique when compared to other European countries and other sectors. Although other European countries have significant energy relationships with the UK, no country has the level of reliance that Ireland has. Furthermore, when I look across the other sectors of the Irish economy, I also view energy as unique. Many sectors of the Irish economy have high levels of trade with the UK. However, the energy sector has one of the highest levels of interdependence with the UK. 

 

As Minister with responsibility for energy policy, I will work to ensure the current strong energy relationship with the UK continues. However, this must be done in a European context. Ireland is and will remain a committed Member State of the European Union. Ireland's energy future will be very much as part of the European internal energy market. 

 

An extensive programme of engagement with all other EU Governments and the EU institutions is underway. This includes the Commission's Brexit Negotiations Task Force. At the most recent EU Energy Council in December, I held bilateral discussions with a number of my European counterparts on the subject of Brexit and the unique challenges faced by Ireland. I will continue this at the next European council meetings on Energy and Environment at the end of this month. This activity is reinforced by extensive engagement at diplomatic and official level.

 

We also need to look at what infrastructure is needed in order to ensure Ireland builds closer links with the European energy market. There is a proposal for an electricity interconnector with France. 

 

Last July, together with the Taoiseach and President Hollande, I witnessed the signing of a memorandum of understanding between EirGrid and the French transmission system operator on the next phase of development for this project. 

 

The potential benefits of importing liquefied natural gas directly onto the island of Ireland and the role of natural gas storage also must be examined in the context of Brexit. 

 

Let me be clear, Ireland has and will continue to have a strong energy relationship with the UK but we must continue to work towards closer integration with the European energy market. 

 

Ireland's relationship with Northern Ireland is also key priority for me. That is why it is important that today's event is an all-island event and an opportunity for a discussion on energy to be held in that context. 

 

I think it is worth re-iterating the Government's main priorities in relation to Brexit. They are

o our citizens;

o economy/trade;

o Northern Ireland;

o the Common Travel Area; and

o the future of the European Union.

 

In this context, we face a number of challenges but also opportunities which must not be forgotten.

 

Today's event forms part of the wider All-Island Civic Dialogue process, launched by the Taoiseach in November of last year.  A series of sectoral All-Island Civic Dialogue events are being hosted by my Ministerial colleagues across the country and these will feed into the next full meeting of the All-Island Civic Dialogue later this month. 

 

The key objectives of today are:

• to discuss the key energy implications arising from the Brexit process, in particular the likely day-to-day impact of Brexit on each sector; and

• to discuss any specific recommendations or issues which may be considered in the context of the Government's preparations for the negotiation process.

 

We are very much here to listen and learn and provide an opportunity to all of you to contribute to the Government's analysis on how to respond to the impact of Brexit on the energy sector. I would underline this point. Today is your opportunity to input your thoughts and insights

 

As you are well aware, Ireland imports most of its energy – in 2015 we had an import dependency of 88% – and the UK is the source of much of this energy. Our indigenous sources of energy which include renewable energy, peat and natural gas are not sufficient to meet our needs. 

 

The proper functioning of our economy and society is reliant on energy and it is therefore a key priority for me to ensure the continued secure trade in energy between the UK and other EU countries.

 

A good example of the energy we import is natural gas. We use natural gas to generate over 40% of our electricity, heat many of our homes and fuel our businesses and industry. In 2015, 97% of the natural gas used in Ireland was imported via the UK. 

 

Imports of natural gas come via pipeline from Scotland to the island of Ireland. We also have our own indigenous source of natural gas. The vast majority of this is Corrib which started production at the end of 2015. 

 

In the short-term Corrib will supply over half of the natural gas needs of Ireland. However, the supplies from Corrib will not last forever. Indeed by 2025, it is expected that Ireland will be reliant on the UK for around 85% of our natural gas needs. 

 

Of course Ireland is not the only country that has energy links with the UK. France, Belgium and the Netherlands all have either natural gas or electricity interconnectors with the UK. Ireland will work as one of a number of European countries to ensure that secure trade in energy continues between the UK and EU Member States. 

 

It is important to note that individually and collectively the European Union, the UK and Ireland are net importers of energy. In many ways, we all have similar challenges and need to work together to ensure a continued close relationship between the EU and UK on energy matters. 

 

A further example of the close energy links we have with our nearest neighbour is the Single Electricity Market for Ireland and Northern Ireland. This cross-border market, in operation since 2007, continues to deliver benefits to electricity consumers across the island of Ireland. We are further developing this market into the Integrated Single Electricity Market (I-SEM). 

 

Last November Minister Simon Hamilton (the Minister for the Economy in Northern Ireland) and I confirmed our joint commitment to the ongoing development of the Single Electricity Market. The new market arrangements will be in place in 2018, yielding benefits for electricity market customers north and south.  The UK White Paper published on Thursday noted that the UK is considering all options for the UK's future relationship with the EU on energy, in particular, to avoid disruption to the Single Electricity Market operating across the island of Ireland. 

 

The North-South Interconnector, which will further support the Single Electricity Market and lower costs for consumers, has received planning permission in Ireland and is in the planning process in Northern Ireland. This is a vital project to ensure the security of supply in Northern Ireland – a further example of the interdependence of our energy systems. 

 

We have carried out detailed analysis and preparation for Brexit and identified key priority areas. However, today is about hearing from you – what you see as the key challenges. The first session will focus on business and the second on social aspects of Brexit. 

 

I would urge everybody to be constructive in your contributions and focus on specific issues to be considered. Officials from my Department are on hand to record your contributions. 

 

I look forward to your input into our preparations for Brexit.

 

Thank you.

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