AFB-net V Targeted actions in bioenergy network Export & import possibilities and fuel prices Task 2 Country report of IRELAND
CONTENTS 1 INTRODUCTION...3 2 BIOMASS RESOURCES...4 3 CURRENT ENERGY USE OF BIOMASS...5 4 CURRENT BIOMASS USERS...6 5 FUEL PRICES...6 6 FISCAL MEASURES...7 7 LEGISLATION...9 8 CURRENT BIOMASS IMPORT AND EXPORT...10 9 CONCLUSIONS...10 2
1 INTRODUCTION In AFB-net V, there was a special task on Export & Import possibilities and fuel prices. The aim of this task was twofold. As far as the international biomass trade is concerned, the main targets were firstly to collect information about the current situation, and secondly to find possibilities to increase the trade in the future. The main barriers were to be recognised, and the ways to overcome these were to be found. One target was also to find alternative transportation routes and organisations which are willing to participate in the international biomass trade. The second part of the task, biomass fuel prices, aimed at collecting information about the biomass and competitive fossil fuel prices in each country. Also the legislative, taxation and subsidy framework has impact on the price levels, so these were also taken into account. The ultimate target was to create a common framework for information collection to make price comparisons possible and to make the price information collection to be a periodically repeated action. To reach these targets, a questionnaire form was created to get the information from different countries in comparable form. The questionnaire was launched in June 1999, and the answers were to be returned in October 1999. Based on the answers, country-wise reports are prepared, and conclusions will be drawn in the Final Report. This report is based on the Irish data on the questionnaire. The information collection work has been done by TRBDI, Tipperary Rural and Business Development Institute. Also other available information has been used, e.g. results of other EU projects, different reports and statistics available, and proceedings of several seminars in biomass field. In the following table 1, some basic facts and figures of Ireland are presented. Table 1. Ireland in brief, 2000. Population 3,63 million (1996) Total Primary Energy Requirements (TPER) * 13,8 Mtoe 578 PJ of which biomass ** 0,161 Mtoe 6,7 PJ Biomass inputs to power generation production 0 Mtoe 0 PJ Biomass in final energy consumption 0,161 Mtoe 6,7 PJ * TPER in Mtoe from Department of Public Enterprise (2000), converted to PJ using 1 Mtoe = 41,868 PJ (from IEA/OECD, 1998). ** From Renewable Energy Information Office (2000) The biomass contribution of 0,161 Mtoe does not include peat, as biomass is not generally considered as biomass in Ireland. Peat contributes 0,95 Mtoe, or 39,8 PJ. 3
2 BIOMASS RESOURCES In figure 1, the estimated annual biomass resources in Ireland are presented. The most important resource is peat, almost 40 PJ/a. In Ireland, however, peat is not generally considered as biomass. The figures for forest residues and industrial byproducts (sawmill residues) are from van den Broek (2000). The forest residue resources are not extracted at present. 45 40 39,8 35 30 25 PJ/a 20 15 10 7,2 5 3,4 3,4 0,7 0 Forest residues Industrial by-products (solid) Domestic (residential) firewood Wood wastes Peat Figure 1. Annual biomass resources in Ireland (total 55 PJ/a). For the domestic firewood, there are two figures available. The lower figure of 0,6 PJ/a is based on UAOS (2000) which gives the estimated volume of firewood used in the Republic of Ireland as at least 58 300 m 3 (green tonnes), and assuming an energy content of 10 GJ per green tonne. The upper figure of 3,4 PJ/a (used in figure 1) is based on domestic firewood accounting for 50 % of the total biomass used for energy (50 % of 0,161 Mtoe or 6,7 PJ). The figure for wood waste is based on EPA (2000) which gives the amount of wood in construction and demolition waste and municipal solid waste as 52 239 tonnes. Assuming an energy content of 13,5 GJ per tonne, due to the relatively dry nature of this wood. The figure for peat is from the Department of Public Enterprise (1999). 4
3 CURRENT ENERGY USE OF BIOMASS The current energy use of different biomass types in Ireland is presented in figure 2. The industrial by-products mean in practice sawmill residues. About the domestic firewood, there are again two figures available, 0,6 and 3,4 PJ/a, of which the upper one is used in figure 2 (see notes of figure 1 in chapter 2). There is no data available about the use of wood wastes. 45 40 39,8 35 30 25 PJ/a 20 15 10 5 2,5 3,4 0 Industrial by-products (solid) Domestic (residential) firewood Wood wastes Peat 0 Figure 2. Current energy use of biomass in Ireland (total 46 PJ/a; no data for wood wastes). The shares of different biomass fuels in the total biomass use are presented in figure 3. If peat with its remarkable share is excluded from biomass fuels (as it generally is in Ireland), then the share of industrial by-products is about 42 %, while the use of firewood covers the rest 58 %. Industrial by-products (solid) 5 % Domestic (residential) firewood 7 % Peat 88 % Figure 3. Different fuels in Irish biomass utilization (total 46 PJ/a). 5
4 CURRENT BIOMASS USERS The number and the total capacity of current biomass users in Ireland are presented in table 2. The figures are estimated in consultation with the Irish Bioenergy Association. Table 2. Current biomass users in Ireland. BIOMASS USERS Amount Unit No. of biomass fuelled DH plants (> 1 MW) 0 pieces Installed capacity of biomass fuelled DH boilers 0 MW th No. of biomass fuelled CHP plants 0 pieces Installed capacity of biomass fuelled CHP boilers 0 MW th MW e No. of biomass fuelled power plants 0 pieces Installed capacity of biomass fuelled boilers 0 MW e No. of biomass fuelled plants in pulp & paper industry Installed capacity of solid biomass fuelled boilers in pulp & paper industry 0 pieces 0 MW th MW e Installed capacity of recovery boilers in pulp & paper industry 0 MW th MW e No. of biomass fuelled plants in sawmills 20 pieces Installed capacity of biomass fuelled boilers in sawmills 1 MW th MW e No. of biomass fuelled plants in other industries (panel board mills and wood-working factories) Installed capacity of biomass fuelled boilers in other industries 250 pieces 120 MW th MW e 5 FUEL PRICES The fuel prices for different fuels are presented in figure 4. There are some variations in prices (the average prices are presented in the figure), but no difference can be made based on the plant size. 6
10 8 7,6 7,8 7,75 8,9 6,45 6 4 3,75 EUR/GJ 2 2,5 2,45 2,55 < 1 MW 1-5 MW 5-50 MW > 50 MW 0-2 Forest residues Industrial byproducts (solid) Domestic (residential) firewood Wood wastes Other biomass resources Peat Heavy fuel oil Light fuel oil Natural gas Coal -4-4 -6 Figure 4. Fuel prices for different plant sizes in Ireland. The prices for forest residues, industrial by-products (sawmill residues) and energy crops are from van den Broek (2000). As no forest residues nor energy crops are currently used in energy production, those prices are estimated average costs of extraction and production. The domestic firewood price is based on UAOS (2000), which gives the range of prices as 40 to 80 per m 3 (51 to 101 per m 3 ; assuming 10 GJ per m 3 this means 5,1 10,1 /GJ). A significant amount of wood wastes are landfilled at present, at a cost. Taking a landfill disposal cost of 30 per tonne (38 ), and an energy content of 10 GJ per tonne, wood wastes have a negative cost of about 4 /GJ. Prices for Peat, Heavy Fuel Oil, Light Fuel Oil, Natural Gas and Coal are from Irish Energy Centre (2000), for commercial/industrial fuels. Prices for fuels used in large scale power generation may differ. Prices do not take into account the efficiency of the fuel conversion equipment. Prices for peat and coal are ex-works prices, and do not include transport to the energy consumer. Prices for natural gas do not include standing charges. Other biomass resources represents energy crops (van den Broek, 2000). 6 FISCAL MEASURES General Fiscal Measures There are no carbon, energy or sulphur taxes in the Republic of Ireland. There are no systems of emissions trading or green credits. 7
Corporate investment in renewable energy projects is eligible for tax relief. Electricity generation is classified as a manufacturing enterprise, and hence subject to a reduced rate of corporation tax. Electricity from Biomass The principal method for the promotion of renewable energy in the Republic of Ireland has to date been the Alternative Energy Requirement (AER). The AER allows potential project developers to compete for electricity supply contracts, based on price per kwh of electricity produced. It is similar to the NFFO process in the United Kingdom. Four AER competitions have been held. Projects have been successfully constructed in the wind, hydro, landfill gas and agricultural biogas sectors. No projects using wood or other forms of solid biomass as a fuel have been developed under the AER process. Government policy guarantees access to the electricity grid for projects successful under the EU Thermie (now Energie) programme. The Tipperary Rural and Business Development Institute has won such a contract for the construction of a 300 kwe wood-fuelled CHP plant, in partnership with B9 Energy Biomass Ltd. Electricity consumers can generate their own electricity. Under the liberalistation of the electricity market, indepent power producers using renewable resources can sell electricity to any final customer, or to a trader. Capital Investment Support Captial grants are available for agricultural anaerobic digestion systems, from the Department of Agriculture, Food and Rural Development. One wood-fuelled heating system has been part-funded under the EU INTERREG II programme. Again, corporate investment in renewable energy is eligible for tax relief. Measures to Support Biomass Production Grants are available for afforestation, together with annual premium payments. This has resulted in a significant increase in the area of conventional forestry, which will in turn increase the volumes of forest residues, sawmill residues and domestic firewood available in the future. Short rotation forestry is not at present supported under these grant and premium schemes. There are no incentives to promote the extraction of forest residues as fuel. There have been a number of important documents produced recently, including the Green Paper on Sustainable Energy and the National Greenhouse Gas Abatement Strategy. A number of fiscal measures are considered in these documents, including carbon/energy taxes and emissions trading/green credits. Some fiscal measures and subsidies promoting renewable energy sources are presented in the following table (table 3). 8
Table 3. Irish subsidies and taxes on renewable energy sources (Source: ALTENER ENER/IURE project and TRBDI). TRBDI Law or regulation RE Strategy AER I, II and III Favourable taxation Capital grants Forestry development Main contents Provides a framework for Renewable Energy development as part of the national sustainable development strategy; promotion of RES projects Alternative Energy Requirement to develop electricity generating capacity from RES; competitive bidding for power supply contracts. Tax relief on certain RE investments, in order to promote such investment in pursuit of sustainable development, CO 2 reduction, and other objectives; reduced tax - on company profits from electricity generation. Grants available for agricultural anaerobic digestion plants. Plantation grants; mainly for construction timber import substitution, but could be used for biomass energy supply. 7 LEGISLATION Corporate Tax Relief The tax relief for corporate investment in renewable energy is included in a recent Finance Act. Electricity Market The Alternative Energy Requirement and the guarantee of grid access for Thermie (Energie) projects are supported by the required Government policy/legislation. The Republic of Ireland has deregulated part of its electricity market, in line with the EU Electricity Directive. Renewable electricity generators are now allowed to supply electricity to any customer directly or via a trader. The electricity may be supplied via a direct line or via the existing transmission and distribution grid. A Commission for Electricity Regulation has been set up to manage deregulation of the electricity market. Electricity production on one s own site for internal use is allowed. Other Supports Any capital grant schemes and the afforestation grant and premium scheme would be backed by relevant policy/legislation. Development Control Renewable energy project development is subject to the normal planning and development controls and may be subject to environmental impact assessment requirements, integrated pollution control licensing, combustion plant requirements, air pollution licensing and water pollution licensing. 9
Table 4 presents the Irish legislation affecting the use of biomass based fuels in energy production. Table 4. Irish legislation concerning energy use of biomass (Source: ALTENER ENER/IURE project and TRBDI). Law or regulation Finance Acts Electricity market Grid access Environmental Impact Assessment Planning Acts Main contents Tax relief on corporate investment in RE Liberalisation of part of the electricity market. Renewable generators allowed sell to any customer. Guaranteed grid access for projects successful under EU Thermie (now Energie) programme. Requirements and obligations for EIA (Environmental Impact Assessment) of certain -projects. Planning and authorisation of all physical development and construction projects. 8 CURRENT BIOMASS IMPORT AND EXPORT The Irish biomass import and export amounts and prices are presented in Table 5. The table shows biomass imports and exports used for energy production. The Republic of Ireland also exports roundwood for non-energy uses, and imports timber and timber products, again for non-energy uses. There are no significant exports or imports of wood for energy from or to the Republic of Ireland (Stephenson, 2000). Table 5. Irish biomass import and export. Biomass type Import price Export price Industrial by-products (sawmill residues) Not significant Not significant 9 CONCLUSIONS The two principal sources of biomass used for energy production in the Republic of Ireland are domestic (residential) firewood and solid industrial by-products (sawmill residues). Together they account for about 1% of the Total Primary Energy Requirement. The domestic firewood is generally used unseasoned in open fires. There is potential to increase the amount of firewood used and to improve the efficiency of its use (for example, by using seasoned firewood in enclosed wood stoves). The use of wood for heating was the subject of an AFB-net workshop organised by 10
TRBDI in March 2000. A user-friendly guide to wood for heating is being produced by TRBDI with the support of COFORD (the Irish National Council for Forest Research and Development). Most of the sawmill residues used for energy production are used in the four wood panel mills in the Republic of Ireland, for heat production. Sawmill residues are also used for heating in sawmills and wood-working enterprises. There is potential for the increased use of sawmill residues for heat, and to develop combined heat and power projects in the panel board mills (a study visit to Finland for personnel from the Irish panel board mills was organised by the Renewable Energy Information Office of the Irish Energy Centre and VTT, and supported under the AFB-net). While the data on the volumes of waste wood arising are poor, it is obvious that there is significant potential for the use of waste timber as an energy source (for example waste wood presently sent to landfill, arboricultural residues, demolition timber). There is significant potential to introduce refined wood fuels (for example, wood pellets). The increased convenience of wood pellets over unrefined wood fuels could be expected to attract more consumers to using wood. There is significant potential to develop forest residues and energy crops (e.g. short rotation forestry) as new sources of biomass for energy in the Republic of Ireland. The potential for short rotation forestry has been estimated at 150 PJ per annum (van den Broek, 2000). There is no significant export or import of wood for energy from / to the Republic of Ireland. SOURCES ALTENER ENER/IURE project, database on the website http://www3.jrc.es/projects/eneriure/pages/data.htm Department of Public Enterprise, (1999). Green Paper on Sustainable Energy. Dublin, Ireland. EPA, (2000). Waste Database Report for 1998. Environmental Protection Agency, Wexford, Ireland. IEA/OECD, (1998). Energy Statistics of OECD Countries. Paris. Irish Energy Centre, (2000). Commercial/Industrial Fuels: Comparison of Energy Costs. 1 st June 2000. [Online] http://www.irish-energy.ie, accessed November 2000. Renewable Energy Information Office of the Irish Energy Centre, (2000). Presentation by Mr. Paul Kellett, Manager. Bandon, Co. Cork. Stephenson, (2000). Personal communication with Mr. Tom Stephenson, Balcas sawmills, Co. Fermanagh, Northern Ireland. 11
UAOS, (2000). Development of a Market Strategy for Domestic Fuelwood in Ireland. Final Report. Altener Contract Number 4.1030/Z/98-573. Portadown, Northern Ireland. van den Broek, R., (2000). Sustainability of biomass electricity systems: An assessment of costs, macro-economic and environmental impacts in Nicaragua, Ireland and the Netherlands. Eburon, Delft, the Netherlands. 12