Time for constructive advance on the grid

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The wind industry can only move forward if it engages in constructive dialogue with the grid operator, the government and the electricity market regulator, delegates to the Irish Wind Energy Conference were told last month

"Gridlock" was the apt title of the Irish wind industry's annual conference where the grid -- in particular lack of access to it -- dominated most of the proceedings. But a willingness to listen and learn on the part of both the government minister for energy, Noel Dempsey, and the new boss of Ireland's grid operator, Dermot Byrne, turned what could have been a miserable two days of pessimism and gloom into an altogether more upbeat event.

Adding to the optimism was the announcement by Dempsey, minister for communications, marine and natural resources, of a new fixed price renewables support mechanism (page 44). This found favour with many in the 200-strong audience, which gathered in Dundalk, County Louth, for two days in early April. The Irish Wind Energy Association (IWEA) has been lobbying for a renewable energy feed-in tariff similar to that operated in Germany. Support in the form of a protected competitive tendering process has lowered wind energy costs in Ireland, but delivered precious few megawatts.

Dempsey also announced that he would be introducing more demand for renewables power under the fixed price mechanism. He was, he said, determined that Ireland would at the very minimum achieve its 13.2% target of electricity from renewables by 2010 and he committed to setting targets out to 2020. Indeed, his performance under a barrage of questions persuaded some that this was all no mere political rhetoric but demonstrated his intent on dealing with the obstacles still standing in the way. The performance did, however, raise doubts about the quality of his briefing: Dempsey appeared to be unaware of the importance to Irish wind generators of two major issues resulting from the delays in connecting new wind farms to the grid.


The first issue is the loss of the right of developers to contest connection offers from system operator ESB National Grid. Before ESB adopted its group processing approach to issuing wind farm connection offers (Windpower Monthly, February 2005), applicants could contest the grid upgrades proposed by the ESB to connect projects if they could prove that the work could be carried out more cheaply and quickly by an alternative contractor.

"We need contestability now," said Grattan Healy, an energy consultant. He is advising developers of a project at Ballycadden in County Wexford, which has received a connection offer from ESB some eight times more expensive than the original estimate. From Dempsey's staff, Martin Finucane agreed that contestability had become much more of an issue with recent increases in quotes for projected grid connection. "It is an area we will be looking at," he said. "We will look to facilitate the industry where possible."

The other issue is the imminent expiry of planning consents for many of the projects that are stuck in the queue for connection offers. Consents are granted for a period of only five years before projects have to be built. Yet a moratorium on all new connection offers imposed in December 2003, coupled with long timescales before ESB expects to be able to connect some projects, mean that many consents may expire before their deadlines.

Minister sets the tone

Dempsey offered to urge his government cabinet colleagues -- particularly the environment minister -- to agree to a quick change to the planning rules. "If someone makes a case for extending planning consents to ten years I will back it," he promised. Owen Ryan from the environment department added that he too would take the message about planning permission back to his minister.

Dempsey's willingness to hear the concerns of the wind industry and look for solutions set the tone for later speakers. These included Byrne, the new boss of grid operator Eirgrid, who was only four days into his post. Eirgrid is the state-owned organisation that will be taking control of the high voltage transmission system from Ireland's major electricity generator and supplier ESB in the government's effort to break ESB's stranglehold over the entire Irish power system.

Byrne told delegates he could understand the industry's frustration over the time it takes to get connected. "It does take time to get planning permission; it does take time to get lines constructed. But I will be looking at any possible ways I can to speed up the process," he said. Byrne pointed to the challenge facing the grid operator to integrate wind into what is a relatively small system. Over 340 MW of wind is already connected to the system, he said, a further 575 MW of wind has received connection offers and over 2000 MW of applications are in the pipeline.

No excuses

But from Airtricity, Eddie O'Connor was not in a mood to accept any excuses. "People have had a lot of debate with the grid. To me it hasn't been violent enough," he exclaimed. "What has happened with the grid in Ireland is simply disgraceful: a moratorium imposed without consultation; we got over that and now look what they've put in place -- clustering. We have the most stringent grid code on the planet, where developers are forced to spend an extra 5-8% capital cost on spurious and unnecessary technical modifications," he added.

O'Connor took particular exception to ESB's plans to constrain wind plant off the system. "We are told we could be constrained off from five to ten per cent [of production]. Every bank will assume it's going to be ten per cent. That means we only get 60% debt in a project and have to supply equity into the rest; that means it gets more expensive and can't compete; that means it won't get built. Constraining off is an outrageous proposal," he said. "We have heard the government say it's their intention to make wind mainstream, but these are just words until we get grid planning to accommodate wind."

Paddy Teahon, chairman of IWEA, was more conciliatory, stressing that the industry can only move forward if it engages in constructive dialogue with the grid, the government and the regulator. This was a clear lesson from the lead up to the regulator's ban on new connection offers, he said. "Rather than identify the issues well in advance that had to be sorted, we all sat in our corners, at a remove, and we ended up with the moratorium," he said. "In Ireland what works for us is being prepared to look people in the face rather than sitting in our offices exchanging pieces of paper and adopting defensive positions. We are not going to agree all the time, but if we sit down together and interact across the table and identify what the problem is and what the solutions are, we rule out that destructive surprise element and create the basis for constructive advance."

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