The long awaited announcement held few suprises. As expected, the original intention to order 30 MW a year of wind power over the next three years was ditched in favour of one large order. All projects proposed under the AER will compete for contracts within their separate technology bands. Wind, however, is being split into two categories, with a 25 MW sub division for small projects of 500 kW to 5 MW. Economies of scale tend to push smaller projects out of the bidding and the sub division is welcomed by developers as an attempt to solve this problem.
Not so welcome is the 15 MW upper size limit for wind plants which has been slapped on the remaining 65 MW of wind under AER III. The blanket restriction has presumably been made with the hope of quelling potential opposition to wind development from sections of the Irish public. But with wind farms more than double that size being built in mainland Europe, the limit is seen as unwarranted by some industry members. Furthermore, an upper limit of 20 MW has been set for any one developer.
As with previous rounds of the AER, prospective developers are being asked to submit plans for the development of wind farms and for sale of the electricity produced to the national public utility, the Electricity Supply Board. Contracts will be awarded under a competitive tender and an independent agency is being set up to oversee and forward approved projects to the energy department for final decision. The price cap for bidders is IR£0.039/kWh. Successful applicants will be awarded a power purchase agreement which will run until the end of 2014. Projects must be in commercial operation by December 31, 1999.
Successful bidders will also be required to enter into a "performance bond" with a recognised bank. This is intended to discourage bids which have little hope of success. Those who succeed may be eligible for a capital grant under the Operational Programme for Economic Infrastructure, amounting to ECU 80,000 ECUs or IR£65,000 per installed megawatt.
The third AER follows AER I, which granted wind developers contracts for 73 MW of capacity, and AER II, which was reserved entirely for one waste to energy project. It seems that only 40-45 MW of wind plant will actually be built under AER I, a success rate which has disappointed Ireland's energy minister Emmet Stagg (see story page 49).