Ireland prepares for move to auctions

IRELAND: The government has launched a consultation on a new support scheme to encourage renewables development, and meet national and European Union (EU) targets.

The 37.6MW Killhills site in Tipperary, Ireland (pic: Crane Hire Ltd)
The 37.6MW Killhills site in Tipperary, Ireland (pic: Crane Hire Ltd)

Officials favour switching from the feed-in tariff support currently provided by the country’s Refit (renewable energy feed-in tariff) programmes, the consultation documents suggest.

The consultation also suggests the most cost-effective way to meet Ireland’s renewable energy obligations would involve an additional 2.3GW of wind capacity — split between repowered and new projects — being installed by 2030, the Department of Communications, Climate Action and Environment (DCCAE) said.

Key considerations for developing Ireland’s new Renewable Electricity Support Scheme (RESS) included incentivising renewable generation, enabling citizen participation in projects, and ensuring cost-effectiveness, officials wrote.

Launching the consultation, which runs until 3 November, DCCAE minister Denis Naughten said: "The scale of transformation needed to meet our low carbon transition targets cannot be overstated.

"If we are to reach those targets, we must harness the combined efforts of the entire country."

Moving to an auction system would mean the new RESS meets EU State Aid rules — measures set by the European Union encourage the switch to competitive bidding processes.

When the EU changed its State Aid guidelines in 2014, EU officials noted replacing feed-in tariffs with auctions would "increase cost effectiveness and limit distortions of competition". The new guidelines came into force on 1 January, 2017.

Officials from the DCCAE also wrote the move would follow the "best practice" of international leaders such as Scotland, Denmark and Canada.

Ireland has a target of having 27% of its final energy demand being derived from renewable sources by 2030, matching the EU-wide target.

In a document analysing the economics underpinning the new RESS, officials noted the most cost-effective way to reach these figures in Ireland was to favour wind over solar PV.

In the suggested 'least-cost mix', officials suggested repowering 1.38GW of onshore wind farms and installing 946MW of new onshore wind projects. This would account for 96% of the newly installed capacity required to meet these target.

Large solar PV projects accounted for just 4% of this mix under the DCCAE’s projection.

However, officials noted that this projection was "based on future LCOE estimates that are somewhat uncertain".

"For example, should the costs of certain technologies change faster or slower than assumed, the LCOEs (levelised cost of energy) and thus the least-cost RES-e mix may turn out differently to the estimated mix".

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