Renewable energy in Ireland

Renewable energy is a key player in the fight against climate change. With its significant geographical advantages, Ireland has incredible potential to harness renewable energy sources, particularly wind energy. However, the journey towards a sustainable future is not without its challenges, writes KPMG’s James Delahunt, Partner Sustainable Futures & Michael Lynch, Partner Tax.

KPMG was recently engaged by Wind Energy Ireland to carry out a consultation with key stakeholders across the renewable energy industry in Ireland to identify what these stakeholders regard as the key issues, that if addressed would result in greater and more speedy deployment of renewable energy generation assets in Ireland to help deliver the national decarbonisation ambition.

Navigating planning challenges

Stakeholders involved in the renewable energy industry widely noted that the Irish planning system continues to be a major hurdle to renewable energy development and see this as a critical area for improvement. James Delahunt, noted our consultations with renewable energy stakeholders revealed widespread concerns about lengthy decision-making processes, often taking up to 90 weeks, due to coordination issues during planning.

These planning process delays pose significant barriers to progress. Ireland’s planning and consenting system is operating at capacity and is in need of greater resourcing. Uncertainty and long timelines in the decision-making process – including the high likelihood of lengthy judicial review appeals – add risk and delays to renewable energy projects achieving a final determination on a planning permission application.

Meeting our ambitious targets

The government has set an ambitious target of having an 80% share of electricity generation capacity coming from renewable sources by 2030. Achieving the Climate Action Plan 2024’s targets of 8 GW solar PV and 9 GW onshore wind requires Ireland to install on average 1.8 GW onshore renewables each year for the remainder of the decade – significantly more than has been deployed to date.

However, according to Michael Lynch, based on our current trajectory it is unlikely that the target of 80 per cent renewable electricity will be met by 2030.

“Ireland’s renewable electricity supply has grown from five to 39 per cent since 2005, leading to Ireland becoming a global leader in onshore wind generation. But Ireland’s electricity demand is growing quicker than we can build renewable generation infrastructure, which is making hitting the target more challenging,” says Lynch.

To realise Ireland's potential in producing ample renewable energy for the purpose of decarbonising our economy, a substantial collective effort is needed. The collective effort needed to address the challenges facing the sector include focus on areas such as (but not limited to)

• Government policy
• Targeted capital investment
• Increased resources.
  

Accelerating investment of capital

Significant investment in capital infrastructure is needed to support the development of renewable energy projects in the Munster region. Offshore wind infrastructure will require servicing, and this offers a significant opportunity for the local communities.

Michael notes “The Port of Cork and the Shannon Estuary have significant opportunities to be premier locations to support offshore renewable energy developments. To capitalise on this opportunity accelerated investment of capital and resources should be made in our ports and roadway infrastructure. Such capital investment in infrastructure to support renewable energy development will help Ireland in reducing our carbon emissions, enhance our energy security, create employment opportunities and over time be more cost effective than fossil fuels”.

Indeed, the electricity grid also requires significant investment to ensure Ireland’s renewable electricity opportunity is developed.

Targeted policy intervention

Furthermore, Ireland is competing internationally for both capital investment and resources for renewable energy developments. Ireland should take heed of international developments such as the United States’ Inflation Reduction Act 2022 which aims to accelerate the transition to a clean energy economy using generous tax credits and incentives.

Ireland needs to quickly evolve its own policies, collaborate with other likeminded countries in EU, including on taxation measures, to unlock Ireland and indeed the EU’s renewable energy and decarbonisation opportunities. 

Winds of change

Recent developments demonstrate the growing commitment to decarbonisation and to meeting our climate goals. The Celtic Interconnector is an ambitious project that will create an electrical link between Ireland and France, allowing the exchange of electricity between the two countries.

It represents a crucial step in Ireland’s journey to a low carbon energy future as well as enhancing Ireland’s security of electricity supply. Another display of collective effort can be seen in the partnership between Supervalu Páirc Uí Chaoimh and Statkraft.

This partnership focused on the promotion of Cork as a national hub for renewable energy generation encouraging and supporting careers within the local renewable energy industry. These recent strides showcase how as a country we are ready and willing to seize the opportunities and benefits in accelerating renewable energy development.

While there are ongoing challenges in the transition to renewable energy, a renewed commitment and collective effort can ensure Ireland maximises the environmental, economic, and social advantages from prioritising renewable energy development.  

This article originally appeared in The Irish Examiner and is reproduced here with their kind permission.