Ireland’s progress towards its 2030 climate commitments has been called into question following the results of the latest auction for onshore renewable energy projects. Planning delays have deterred developers, leading to a significant undersubscription of the Renewable Energy Support Scheme 3 (Ress3) auction.
The results, published by national grid operator Eirgrid, revealed that the auction was “massively undersubscribed,” according to Donal O’Sullivan, VP and director for Ireland wind and solar projects at Statkraft. Initially, the auction was expected to award between 2,000 and 3,500 gigawatt hours of renewable onshore wind and solar energy contracts, but this was reduced to less than 1,000 GWh.
The Ress auctions form part of the Programme for Government and the Climate Action Plan 2021, with the aim of achieving a target of at least 80% renewable electricity by 2030. These auctions award contracts to generate renewable electricity for 15 years at a set price.
O’Sullivan stated that the results are indicative of the current climate and that any future auctions would need to be as successful as Ress1 in order to meet the country’s climate targets. The number of bidders in Ress3 was approximately 40% of the number in Ress1.
Despite the undersubscription, there were still over 20 successful bidders in Ress3, including Statkraft, which secured solar projects in Cork and Wexford. However, this auction had the fewest number of renewable energy bidders to date and the highest average price of €100.47 per megawatt per hour.
O’Sullivan highlighted that planning issues remain the primary reason for the undersubscription, and these results demonstrate the impact of these delays for the first time. In some cases, it is taking up to 12 months for the State planning agency, An Bord Pleanála, to grant permission for renewable energy developments. O’Sullivan stated, “There are not enough projects to meet government ambitions.”
Industry representative body Wind Energy Ireland expressed disappointment with the results, stating that they were “extremely disappointing.” CEO Noel Cunniffe noted that instead of seeing prices decrease and the volume of renewable energy winning contracts increase, the opposite is occurring. Cunniffe echoed O’Sullivan’s concerns about planning delays and their impact on renewable energy development. He highlighted that numerous wind energy projects are stuck in planning limbo, with average decision times exceeding 90 weeks, well beyond the mandated 18-week timeframe.
In addition to planning delays, inflation is also putting pressure on the renewable energy industry, as the Ress auctions require investment capital prior to the awarded contracts. Meanwhile, the UK recently faced a setback as its latest offshore auction failed to attract any bidders due to pricing concerns.
These results indicate that Ireland’s path towards its 2030 climate commitments may be hindered by planning delays and a lack of investment in the renewable energy sector. Urgent action is needed to address these issues and ensure that Ireland can meet its renewable energy targets in a timely manner.