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Ireland

Ireland

RoI tweaks FIT but curtailment is key

Wind-energy developers in the Republic of Ireland (RoI) are getting to grips with revised rules governing the country's feed-in tariff, which will slightly reduce support from the government.

Details emerged in March about how the RoI's new feed-in tariff, known as Refit 2, will operate. Refit 2 applies to new onshore wind farms built between 2012 and 2015, providing 15 years' support via a "reference price".

The reference price will be linked to the country's consumer price index (CPI) and the same base rate will be used as for the new tariff's predecessor, Refit 1. This provides EUR66.35/MWh plus CPI changes since 2010 for projects larger than 5MW, and EUR68.68/MWh plus CPI for smaller projects.

But Refit 2 cancels some instances when a second "balancing payment" of up to EUR9.90/MWh is paid if the market price paid for electricity is less than the tariff reference price. These balancing payments will no longer increase in line with the CPI.

Ireland's generally pro-wind national government has also confirmed that it has asked the European Commission for permission to extend the end date for Refit 1 payments until 2027. If approved, this will allow a full 15 years' support for a few projects that were due to be included in Refit 1 and that were either built last year or are due to come online this year.

More acute concerns

Although Refit 2 signals a slight decline in financial support for new onshore wind, it is ongoing uncertainty about curtailment that is causing most concern among developers.

The policy on curtailment - for times when there is too much wind energy on the Irish grid - was introduced in both the RoI and Northern Ireland at the end of 2011, and risks putting a stop to much new wind development. Such has been the furore over the policy that Ireland's single energy market has agreed to review its decision.

The island's commissioner for energy regulation, Garrett Blaney, told wind industry representatives at the Irish Wind Energy Association's conference in March that "we're open to arguments" and that "we want a final decision on curtailment that works for everyone".

The disputed policy curtails only new wind farms and those that have yet to be granted 'firm' grid access during times of excess wind, while protecting older, established projects. Developers argue that the increased rates mean many new projects will be unviable.

Another issue dominating discussion within the Irish wind-energy market is how to build an export-based offshore industry. In February, the RoI government announced it would not introduce a feed-in tariff for offshore wind. Instead, it is seeking agreement with the UK government for new offshore projects built in RoI waters in the Irish Sea to be connected to the UK national electricity grid and to contribute to the UK's renewable energy targets (see page 49).

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