The Electricity Association of Ireland has published a report outlining a policy and investment pathway for the decarbonisation of the sector, which it says will play a critical role if Ireland is to achieve its climate goals.
It projects investment of close to €2bn annually in electricity grid reinforcement, renewal and resilience is needed to drive this transformation – a level not previously seen on the island but necessary, it says, to avoid fines of over €8 billion.
It marks the shared view of the sector across the island from generation through to retail.
The report finds Ireland must increase electrification of industry, heating and transport in tandem with accelerating the adoption of renewables.
The EAI says electrification of industry has stagnated in Ireland, increased ambition in this area is required so that excess renewables can be consumed in Ireland giving Irish industry a distinct advantage in greener industrial outputs.
Dara Lynott, CEO, EAI said, “The electricity sector must decarbonise in advance of society but the potential technology options that will help us achieve this goal all carry high levels of uncertainty.
“They share a requirement for significant capital, long construction times, decades-long lifespans, and a critical need for investment decisions to be made well in advance of 2030.”
The report finds an all-island policy, investment strategies and frameworks must be clear and cohesive to attract the necessary capital for post-2030 technologies.
An investment framework that supports the decarbonisation of the All-island Electricity System and aligns with the scale of capital commitment and projected revenue streams is required.
“Having assessed the technologies needed, it is clear that expected revenue streams will change dramatically over the next 15-20 years,” Mr Lynott said.
“Ireland must adjust its investment strategies and frameworks to attract the necessary capital for post-2030 technologies. This could include new financial incentives, restructured revenue models and supportive policies for large-scale renewable and low-carbon investments.”
He also said the aim is to ensure that Ireland can secure the funding necessary to meet its ambitious decarbonisation targets.
Mr Lynott said it will require a level of investment that has not been previously seen on the island.
“A comprehensive overhaul of how energy, system services and capacity markets interrelate is needed. Prioritising short-term cost savings over long-term capacity needs could hinder decarbonisation goals and ultimately increase costs for consumers,” said Mr Lynott.
Article Source – Decarbonising electricity sector will cost €2bn annually – EAI – RTE
