Report for Irish Wind Energy Association says new government must support industry to reduce costs.
The Irish wind industry is urging the government to instigate policies that will cut the cost of developing projects or risk pushing up the price of electricity.
A report released today by Everoze for the Irish Wind Energy Association (IWEA) includes calls for an industry task-force to cut the price of renewable electricity.
The report found that decisions made by the next Irish government could nearly halve the price of renewable electricity in Ireland or increase it by as much as a third.
It said that over the last 20 years the price of onshore wind energy has been falling steadily.
For example, wind farms in Nordic countries are selling power at prices as low as €30 per megawatt-hour (MWh) while in Spain, Germany, Turkey and Poland prices have fallen to €40/MWh. In comparison the average annual price on Ireland’s wholesale electricity market over the last 10 years has ranged from €45-65/MWh, the report said.
“Government ministers, officials in various departments and other policymakers will soon decide whether Ireland’s homes are powered with some of the most, or the least, expensive renewable electricity in global markets,” IWEA said.
The report identifies 10 policy choices critical to setting a low price for renewable electricity.
They include allowing taller turbines of 180 metres or more, which could cut the cost of wind energy by 27%.
Changing planned noise limits proposed in the new draft Wind Energy Guidelines, which would currently increase the cost of electricity produced by wind farms by 11%, Everoze said.
Increasing the the duration of planning permission to 30 years from 20 years could cut costs by 10%.
Strengthening the grid network could cut costs by 18% as currently substantial amounts of power are lost because the transmission system struggles to cope with the volumes of renewable electricity available, the report said.
IWEA chief executive David Connolly said: “It will be the policy choices made by the next government which will decide whether Irish consumers are paying the lowest or the highest possible prices for renewable electricity.
“Every additional euro on the price of wholesale electricity works out at hundreds of millions added onto the bills of hardworking families.
“We are calling on the incoming government to immediately set up a task-force with the sole remit of identifying ways to reduce the price of renewable electricity in Ireland and require it to report within nine months.
“We hope this study will ensure the choices made by the next government are informed and focused on delivering renewable electricity at the lowest possible cost to the consumer.”
Everoze’s Simon Bryars said: “It is clear from the analysis that certain policy changes now could have a significant impact on the costs of onshore renewables to consumers in the short term and over the next 30 years.
“The ability to utilise the latest technology combined with a strong transmission network with export capability are key to further large reductions in costs.”
The IWEA said the key to pushing down the price of renewable electricity in Ireland will be the introduction of renewable electricity auctions.
The first of these is due to take place next month under the new Renewable Electricity Support Scheme.
Connolly said: “Prices will only fall if projects can provide power at the best possible price but in recent years government policy has been pushing prices up, not down.
“Commercial rates for onshore wind farms have more than doubled. The proposed new Wind Energy Guidelines will add billions onto consumer bills over the next 25 years.
“Families and businesses want clean power and they want cheap power. They can have both but only if the government works alongside industry to drive prices down as far as possible.”