COMMITTEE FOR AGRICULTURE AND RURAL DEVELOPMENT

OFFICIAL REPORT

(Hansard)

Inquiry into Renewable Energy and Alternative Land Use

1 May 2008

Members present for all or part of the proceedings:

Dr William McCrea (Chairperson)
Mr Tom Elliott (Deputy Chairperson)
Mr P J Bradley
Mr Allan Bresland
Mr Thomas Burns
Mr Trevor Clarke
Mr Willie Clarke
Mr Pat Doherty
Mr William Irwin
Mr Francie Molloy
Mr George Savage

Witnesses:

Mr John Hardy )
Ms Paula Keelagher ) Sustainable Energy Association
Ms Ruth McGuigan )

The Chairperson:

We will commence the final evidence session for today. The witnesses from the Sustainable Energy Association (SEA) are John Hardy, Ms Paula Keelagher and Ms Ruth McGuigan. Thank you for coming to the Committee, we appreciate your presence. We have a copy of your presentation, and if you would like to take us through that first, we will ask questions afterwards.

Ms Ruth McGuigan (Sustainable Energy Association):

My name is Ruth McGuigan, and I am the chairperson of the Sustainable Energy Association. My colleagues are John Hardy, the secretary of the association, and Paula Keelagher, who is a member of the association and is representing Balcas today.

The Sustainable Energy Association represents small-scale renewable-energy industries throughout the island of Ireland. It encompasses approximately 1,000 businesses and 4,000 employees in the agriculture, manufacturing and service sectors. It includes people who grow energy crops, produce fuels, develop renewable technologies, install renewable systems and assess energy performance. The association offers a wide range of expertise, knowledge and experience, upon which we hope the Committee can rely.

Northern Ireland has some of the best wind and tidal resources in Europe, as the Committee will be aware. Arguably, we also have the best conditions in which to grow energy crops. Our natural and renewable resources should be utilised for the benefit of the people of Northern Ireland to create a more self-sufficient and cost-effective economy and energy sector. Energy security, shorter supply chains and carbon-emission reductions can all be achieved through greater use of our natural resources and our farming base.

John Hardy will take us through the first of our three points, which is growing the market for heat and hot water. Hopefully, I will then run through the plan for renewable energy on farms, and John will then talk about rural-development opportunities through energy entrepreneurialism.

Mr John Hardy (Sustainable Energy Association):

I thank the Committee for inviting us to make this presentation. The Committee will be aware of the background to sustainable energy, and I hope that I will be preaching to the converted on that issue. According to the former Department of Trade and Industry, around 30% of the total energy consumed in the UK — excluding transport — is used to heat space and for process heating. Around 1% of that heat is currently generated from renewable sources, and 8% is met by combined heat and power (CHP) systems that are fuelled by fossil fuels or renewables. There are significant opportunities to reduce the UK’s, and, in particular, Northern Ireland’s, carbon emissions by increasing the contribution from renewable energy and CHP to that market. There has been little growth in combined heat and power, although the Government has in place several support mechanisms for CHP.

Supply needs to be increased to meet demand. There is also a need to move away from research and towards practical support of a growing market, for example, in wood pellets, which are cost-competitive compared to oil or gas central heating systems, especially after recent price increases in oil and gas. There is a danger that demand will continue to outstrip supply, and wood pellets are increasingly imported into Ireland to meet market demand for pellet-based central heating systems. The domestic and agriculture sectors should not be seen as separate or dichotomous in the application of renewable energy; rather, by providing grant aid or introducing legislative requirements for renewables in private residences, demand for biomass — for example, wood pellets — will increase and have a positive effect on the agriculture sector.

Supporting the renewables industry will result in future demand for energy crops. Meanwhile, the agriculture sector must increase production to meet current demand. Large quantities of energy crops are imported, with the potential revenue loss for local farmers as well as creating a larger carbon footprint. Meeting this demand locally would greatly benefit farmers in Northern Ireland, reduce carbon emissions and contribute towards tackling climate change.

The Sustainable Energy Association, in its submission, supports several points made by the Ulster Farmers’ Union (UFU) in its submission to the consultation on renewable energy by the Department of Agriculture and Rural Development (DARD). Those include the union’s views on biomass, and the challenge fund for short-rotation willow coppice. In its submission, the UFU said that:

“Research to assist with the development of the sustainable energy crop sector must be a priority, and incorporated fully as such within DARD’s Research and Development strategy.”

However, research should not duplicate work already carried out in other regions, such as by Teagasc in the Republic of Ireland. As the energy market in Ireland operates on an all-island basis, duplication of effort will create unnecessary financial and time burdens.

The renewable-energy-crop sector could be sustainable economically and environmentally. Research on energy grasses such as miscanthus, reed canary grass and switchgrass should continue into their merits as not only potential sources of biomass; but in a holistic way by examining their wider properties and to try to translate them into production — for example, starches associated with plastics, fibres, and so on.

The Republic of Ireland has already moved beyond the research stage and into the commercialisation of energy grasses such as miscanthus, especially in areas where sugar beet was grown. Close co-operation with the Republic could speed up the prospects of farming in Northern Ireland enjoying the economic benefits of research. Therefore, there is no point in duplicating that which has been done elsewhere.

Recent rises in the cost of fossil fuels has resulted in a host of small-scale systems becoming affordable for use on farms. With oil at $120 per barrel last week, most forms of domestic systems are now cost competitive, with fossil-fuel systems having a payback vis à vis oil and gas.

Ms McGuigan:

I will touch on how planning for renewable energy affects the farming community. At present, draft Planning Policy Statement (PPS) 18 is under review; we have contributed to the review, and will contribute to the wind-energy sector, too. The planning policy statement is ambiguous and parts of it are open to misinterpretation by local planners. There are, therefore, areas where planners are for or against renewables, and each area can implement a policy differently. That is an obstacle to a nationwide implementation of a proper energy policy, which should be consistent and clearly understood.

National policy must, in some instances, override local issues. Everyone wants a wind farm, but no one really wants it in their own back garden. Nobody really wants nuclear power everywhere either, but they are happy enough so long as it is built in Scotland to provide power to Northern Ireland. That is the case across the board. There has to be a statement of need, and a national policy, which will deal with the Nimby, or “not in my back yard”, factor. We need energy for the future, and there is a need to take a national stance on that. It is here that that statement of need and that policy can be put together, and implemented through an unambiguous planning policy.

An issue of concern about the draft PPS 18 is that it rules out a large area of farmland in Northern Ireland. The advocates of the establishment of a national park in the Mournes, for example, are in favour of having wind turbines in that park; it would be an open and very visible sustainability statement. However, draft PPS 18 provides for the exclusion of areas of outstanding natural beauty (AONBs), such as the Mournes, so that automatically there is no scope for renewables in those areas. A lot of those areas consist of farmland, but some of my customers, who are farmers based in those areas, want renewables on their land. They want to cut down their carbon emissions, and they need to reduce their energy costs in order to stay competitive. Draft PPS 18, as it stands, will wipe out that opportunity for those farmers in 25% of the farmland in Northern Ireland.

A mandatory requirement for renewables is needed. Unfortunately the building regulations this year did not bring in any such mandatory requirement, which had been hoped for, to bring us into line with the rest of the UK. Draft PPS 18 represents an opportunity to rectify that a little bit, by including environmental impact in planning policy. That is done in the Republic of Ireland and in most of the boroughs of London, where all buildings must address in some way certain sustainability issues, such as micro-generation, or lowering the carbon footprint in some manner. That is currently not included in building regulations or planning regulations in Northern Ireland. The issue is not being addressed from any side at all, whereas in the majority of the rest of the UK and the Republic of Ireland it is being addressed, either through planning policies or through building regulations. Here in Northern Ireland there is an absence of both, which is obviously leading up to problems in the future.

Our organisation suggests copying the approach of those other jurisdictions where possible, rather than going back to the drawing board and reinventing the wheel. Time and finance are both constraints, and every time something has to be researched again, it takes a big chunk of the budget just to achieve what other people have already achieved. For example, in London, for every square metre of a domestic dwelling, a specific number of kilowatt-hours of energy have to be generated on that site through micro-generation, or solar water heating, or a biomass burner. All of those in turn support the local industry: for example, if a biomass burner is installed, a local farmer will then have to provide the wood pellets or willow to feed that burner. That would also mean that all new houses are built to a higher standard.

Increasingly, higher energy costs are being felt by rural communities in Northern Ireland. Fuel poverty is on the increase in rural communities, where there is a much heavier dependency on cars, and most dwellings are bungalows, not terraced houses or semi-detached houses, which are inherently more energy efficient. Rural dwellers are probably higher users of energy per head than urban dwellers. My company installs both wind and solar electricity generators, and I know from experience that urban dwellers often use around 7,000 units of electricity per year. Rural dwellers, on the other hand, will use somewhere in the region of 12,000 to 14,000 units. That is simply because of the way that rural households work, but because of that the rural community stands to suffer much more as energy prices increase. They are already suffering from fuel increases just trying to get to and from the grocer’s in their own cars. An attempt to embed more energy efficiency in rural houses, and houses across the whole of Northern Ireland will, in the long term, pay dividends for the rural community, and possibly feed into the agriculture sector to supply those different technologies and fuel crops.

Mr Hardy:

Thank you, Ruth. I want to talk about rural development and energy entrepreneurialism. Anyone who has viewed John Gilliland’s presentation on farm diversification will understand immediately what is meant. John is the Northern Ireland commissioner on the Sustainable Development Commission (SDC): his examples include short-rotation coppice, disposing of sewage sludge and the sale of energy.

Promotion of renewable energy can improve the competitiveness of farm and horticultural businesses in Northern Ireland by creating diversification into viable and sustainable energy production, both in the form of energy crops and in the use of land for the location of wind turbines. Development of viable, stable and sustainable long-term supply chains is possible through creating a greater link between the growth, processing, marketing and use of locally produced biomass and wind energy for Northern Ireland, particularly in rural areas. Production of energy crops or indigenous fuel-producing companies — for example, wood-pellet manufacturers — will add value to agriculture and forestry products and improve marketing capability. Capital expenditure, on new buildings and equipment for the processing, drying and storage of such materials, should be encouraged.

A short-rotation coppice scheme will also provide support for farmers who wish to establish coppice crops, diversifying production and income sources. DARD should promote self-sufficiency in energy production in rural areas and on farms, with each individual home or farm producing heat and electricity from renewable sources. That will improve the quality of life, living conditions and welfare in rural areas, as fuel costs are lowered and residents develop a sense of pride in self-sufficiency.

Small-scale energy-crop production and processing for on-site use can also create the seeds of expansion and employment opportunities, through promoting entrepreneurship and developing the economic infrastructure in rural areas. Micro-enterprises should also be promoted. The Sustainable Energy Association also supports the Ulster Farmers’ Union by stressing that on-farm combined-heat-and-power technology is already available. We urge DARD to be supportive and imaginative in working with farmers, not only to install such facilities for their own heat and power needs, but also to work on the industry’s behalf, in conjunction with the Department of Enterprise, Trade and Investment, to enable the rural community to develop the infrastructure to sell electricity directly to end-users. The privatisation of the electricity market, which occurred in 2007, challenges DARD to assist the rural and agriculture sector to capture economic benefits through the opening-up of hitherto closed markets.

DARD can help support the renewable energy industry through promoting installation of renewable-energy systems by certified installers, and the use, where possible, of locally manufactured systems. That will, in turn, drive the demand for locally produced energy sources, which will benefit the agriculture sector.

The SEA is aware of several difficulties that occurred when turbines were installed through the Department’s Wind Energy for Rural Businesses programme, through which poor-quality turbines were incorrectly installed and failed to work. That gave a negative impression of renewable energy technologies. The SEA urges support for UK or Irish turbines of proven reliability and the highest quality of installation. It recommends the use of systems approved, for example, by Action Renewables, or Sustainable Energy Ireland in the Republic, or systems tried and tested in the UK.

It is important that energy-crop production does not compete with food production, as the promotion of foodstuffs is crucial to a sustainable future. However, in many cases, energy crops can be grown in areas that would otherwise be unsuitable for foodstuffs.

The projected decline in the size of the national herd may result in less-intensive meat farming. That can be coupled with an increase in crop production, in relation to other agricultural sectors, to coincide with the development of energy crops as a viable sector.

The Chairperson:

Thank you. In the presentation, you tell us that:

“ Northern Ireland has some of the best wind and tide resources in Europe and arguably the best conditions for growing energy crops.”

Evidence that we received this morning agrees that, in Northern Ireland, we have the best wind resources. Those witnesses were not so sure about the tidal resources. Can you enlighten us?

Ms McGuigan:

That work is ongoing. The first tidal-energy system, the biggest in the world, has just been placed in Strangford Lough. Shortly, we may be able to verify that statement. We also have good opportunities for harnessing energy from waves. Energy produced from tides is often confused with that from waves: perhaps we should have referred specifically to wave energy at that point in the submission.

The Chairperson:

We were told that wave was taken from us by the Republic.

Ms McGuigan:

The Republic of Ireland has leapfrogged us in a number of areas.

The Chairperson:

It was suggested that our wind resource is a big bonus for us.

Ms McGuigan:

Absolutely; we have the second-highest wind resource in Europe with only Scotland — predictably — being higher. We have fantastic wind resources. Wave energy is high all the way down the west coast of Ireland, but we are doing well on tidal energy and we have wave resources in the north-west.

The Chairperson:

In growing energy crops, John said that we must be careful not to challenge the primary purpose of a farmer, which is to produce food. What do you mean when you say that we have the best conditions for growing energy crops?

Mr Hardy:

I do not have any evidence with me. Our members have told us that the soil quality, level of rainfall and the climate in Northern Ireland is good, not only for growing wheat and barley or for raising cattle, but also for growing crops like willow, which is a native tree and thrives in the conditions in Northern Ireland.

The Chairperson:

So, rather than challenging food production by farmers, energy crops could be grown in areas where food production is not —

Ms McGuigan:

In land that is not as favourable for food production. There should be rotation; grow crops one year and then move on. Energy crops should be an alternative source of income for a farmer.

Mr T Clarke:

Can you identify an area that is more suitable for growing willow than crops?

Ms McGuigan:

No; not off hand.

Mr T Clarke:

I mean in general — what type of area is more suitable?

Ms McGuigan:

Willows are often grown in bogland and marshland because they require a lot of water.

Mr T Clarke:

Is there not a biodiversity problem for harvesting on bogland?

Ms McGuigan:

It depends on our approach — there would be a problem if we grew the crops willy-nilly. However, it will not be a problem if we bring in the correct bodies to examine the areas where there is the potential for growing crops. We are underutilising our land resources that could be used to grow alternative crops.

The Chairperson:

Which of the renewable technologies offer the best opportunities to the rural economy in Northern Ireland?

Ms McGuigan:

That is a good question.

Mr Hardy:

Wind and biomass are the top two. In addition to the prevalence of wind in Northern Ireland, farmers can receive the rental for wind turbines — if things are being done commercially — or they install a wind turbine on their farms to support their high electricity usage. Just as wind keeps energy production local, the same applies to multi-level production of biomass — farmers grow the biomass and companies such as Balcas produce wood pellets in Northern Ireland, which are sold to local homes. Those homes may have wood-pellet boilers that are made by companies in Ireland, such as Gerkros Heating Technology. Biomass has the potential for multi-sector level add-on value.

The Chairperson:

Pauline, are wood pellets a sustainable product?

Ms Keelagher:

We harvest all our trees from Forest Stewardship Council managed forests. At present, the Enniskillen site has a 50,000-tonne capacity. We are building a new plant in Scotland, to which we already supply significant amounts of the product. Production for the Irish market will remain in Enniskillen. The process is sustainable and carbon neutral: we use co-product — waste sawdust from sawmills — to make wood pellets and we use woodchip to produce heat and power on site. In that sense it is completely sustainable.

Mr Elliott:

Thank you for your presentation. My question is about wind turbines. In the point about wind energy for rural businesses in submission, you indicated that poor-quality turbines were incorrectly installed. I know of one specific issue about that in my own constituency.

Who was to blame for that? What measures have been taken to ensure that that does not happen again? It was a big issue; some of the turbines gained grant approval, but when they did not work properly, the grant process was held up.

Ms McGuigan:

We should be asking the Department that question, because it chose or nominated Newell Maher Engineering (NME) consultants, who selected the turbine and specified the installer. During the tendering process something went wrong to allow a substandard turbine to be accepted.

Mr Elliott:

Was that DARD’s fault?

Ms McGuigan:

No, I am not apportioning blame. However, during that process, the wrong turbine was selected. Somewhere during the selection process not enough knowledge was applied to select the correct turbine to suit the Northern Irish market.

On the plains of America, a turbine that experiences steady winds and rarely feels the effects of blustery north Atlantic winds can survive for 20 years. Install that same turbine on a farm in Donegal or along the north-west coast and it will be blown to smithereens. A turbine must be chosen to suit the conditions in which it must operate. It is horses for courses and, in that instance, the wrong horse was chosen.

We must examine that particular process to see where it failed. At present, all turbines installed through the — recently defunct — Reconnect grant scheme, which I am sure you are all familiar with, and the low carbon buildings programme, undergo rigorous testing. Once the turbines are approved, it is the installers that are held liable if anything goes wrong. A scheme such as that ensures that there is more security for the client at the end. Poultry and dairy farmers need a substantial turbine, which must be suitably selected.

Mr Elliott:

Is the lack of joined-up government a big problem? You will be aware of a case that I was involved in, whereby a certain person could get funding for a turbine, but it had be for 24 m or 25 m high. However, the planners would only permit a 17 m one. Therein lies the difficulty; we could not square the circle.

Ms McGuigan:

It is a massive problem and one that exists right now. We ran the Reconnect grant scheme for two years, with the idea of building an industry. At present, we have a fabulous, vibrant industry. We have farmers establishing capabilities to grow biomass crops. Now those farmers, who invested in the process and learned about the technology, face a shortfall. Possibly, the last biomass burner has been installed. Where is the market going in the years to come? Farmers have had the carpet pulled out from under their feet.

One plan is not feeding into the next. Planning policy indicates that farmers should install only 9 m-high turbines, whereas across the UK we are recommending the installation of turbines that are 15 m or more high. Subsequently, turbines underperform, which makes the industry look bad. However, the industry looks bad only because the policy contradicts industry requirements.

Mr Elliott:

When the local Adminstation got up and running again, did you assume that that situation would improve?

Ms McGuigan:

We are still hoping that that is the case. We have delivered the same message to the Environment, Trade and Investment Committee and to this Committee: we need an energy policy that includes everyone.

The Chairperson:

When Mr Elliott asked you who was to blame for the substandard turbines, I noticed that you were not willing to lay blame, which is one of the biggest problems. No one is willing to accept blame when something goes wrong.

Ms McGuigan:

I have not been personally responsible, and I do not know the ins and outs of that. I just know that when I mention a wind turbine to anyone in Newcastle, they tell me about the one on Tyrella beach that has not worked for two years. I have had nothing to do with that, and it would be wrong of me to apportion blame.

The Chairperson:

You are very glad about that.

Ms McGuigan:

How can we apportion blame? I am sure that an investigation is ongoing.

Mr Bresland:

Were there initial problems with some turbines? Were some of them faulty?

Ms McGuigan:

There have been some issues with some turbines. There are substandard products in every walk of life. One cannot expect a high-quality result from a cheap product.

Mr Bresland:

It is a matter of choice.

Ms McGuigan:

We warn our customers against it all the time. I could supply you with an all-singing, all-dancing £10,000 turbine, while someone else could charge you £20,000. You do not buy a Ford Fiesta and expect it to perform like a Mercedes. We have to be aware of variations, but we do not have a governing body —

The Chairperson:

We must be careful. We do not want to be challenged by those car firms.

Ms McGuigan:

You know what I mean. There is a wide variation, and some of them are not suitable for our market. Others are of low quality and will not last the course. Only a good turbine will survive our high winds and blustery conditions. Not much research has been done on that subject.

Mr W Clarke:

You are all very welcome. Ruth mentioned the fact that draft PPS 18 will prevent the development of renewable technologies in AONBs. It is my belief that the “clean and green” image of turbines, for example, will complement the tourism product, and that we should be reducing fossil-fuel emissions in those areas. Draft PPS 18 seems to contradict the environmental ethos. Your written submission describes how individuals can produce power, and how communities can develop a communal heating system. Following on from the Reconnect grants, how can such projects be funded? Are they viable? You have just pointed out that a huge gap will be created.

Ms McGuigan:

That is the case. In most of the rest of Europe, grant schemes for such projects have been replaced by mandatory targets or legislation. Our problem, as you have rightly mentioned, is that we do not have an all-encompassing energy policy. There is no energy vision in Northern Ireland at all. The people who want to be involved in the industry, and all those young entrepreneurs who believe that they can produce fantastic designs, do not have any backing.

We do not have a code for sustainable homes, which is a concept that has been accepted throughout the rest of the UK and in the Republic of Ireland. All those regions will be building carbon-zero homes by 2016, but we have opted out of that entirely. We are building bad homes and embedding fuel poverty in every building that is currently being constructed. We are not making any moves to change that situation at all. It is not even on the agenda; it is not being discussed. That is the situation in the housing market.

The transport sector is facing similar difficulties. We do not have a policy on improving transport or reducing its effects. The Westlink is being widened, but we are not bringing any more buses onto our roads. The Reconnect grants only served to develop industry. We have those industries now, but we are sitting on out hands, waiting for them to collapse. If we do that we will have to play catch-up with the rest of Europe.

The alternative is to have an all-encompassing energy policy. The planners must do the right thing in respect of draft PPS 18. Building control must do the right thing and adopt the code for sustainable homes. The Reconnect grant should be extended until those policies are introduced, so that the market can be sustained.

The Chairperson:

Is it not true that the code for sustainable homes has been mandatory for social housing here since 1 April 2008?

Ms McGuigan:

Yes, it has, but for social housing only. That is only a small part of the picture.

The Chairperson:

You did not mention that.

Ms McGuigan:

I am sorry.

The Chairperson:

You said that it was not even on the agenda.

Ms McGuigan:

It is not on the public agenda. If I build a house in the morning it will make no difference. The Government have adopted it for its own purposes. However, the Housing Executive still refuses to install wood-pellet burners, and continues to install oil burners. An element of the policy has been adopted, but not the entire policy.

Mr Bresland:

You said that renewable-energy production could have a tourism dimension by attracting visitors to sites, such as wind farms. However, the perceived damage to landscape often causes most objections to wind-farm proposals. Can you give us examples of where renewable-energy schemes have been successful tourist attractions?

Mr Hardy:

The idea about tourism came from a briefing to the Committee for Enterprise, Trade and Investment by the Climate Change Coalition NI. John Woods of Friends of the Earth mentioned the tourist dimension of wind farms. He happened to mention that research has shown that large wind farms have a degree of attraction for visitors, such as hill walkers.

The Chairperson:

John, that is easy to say, but what proof do you have? Mr Bresland is asking for proof. You have used good jargon. A person might be in trouble, and many people will sympathise; people’s pockets are full of sympathy, but others are still in poverty.

Mr T Clarke:

There were recent discussions about an offshore wind farm at Portstewart, which is a tourist area. Local objection to that wind farm was phenomenal, and that contradicts your point.

Ms McGuigan:

Local objection is standard, to be honest.

Mr T Clarke:

However, we are looking at it from a tourism point of view. Alan Bresland referred to your submission, which suggested that there was potential for tourism, whereas, at a tourist destination — the Portrush/Portstewart area on the north coast — there was massive objection to a proposed offshore wind farm. That is a total contradiction to your point about tourism.

Ms McGuigan:

The people who object are not tourists, they are locals. We cannot know what impact such a scheme will have on tourism. There is a growing industry —

The Chairperson:

Is that true? Sorry to interrupt, but is that fact? For example, tourist officers objected, not only locals. People in the local council, who were involved in promoting tourism there, objected. They did not object purely for the sake of it. Did they object because they felt — as I believe was the case — that such a scheme would destroy tourism potential? I am testing some of the evidence that has been presented.

Ms McGuigan:

There will always be submissions that will not be approved. Many proposals in England are not being approved. However, there are places where proposals should be approved. No matter where a wind turbine is put, it will be obvious; it will change the aspect of the hill, mountain or landscape on which it is built. If you ask people what they think of it, 50% will say that it is fantastic, and 50% will say that it is awful. People who approve of wind farms generally do not stand on the top of the mountain and scream their approval. The people who disapprove always seem to be louder. We always hear the disapproval and rarely hear the approval. Most people are pro wind turbines. However, most people are pro anything, as long as it is not in their back gardens.

That is why we are saying that the national need for energy security must take priority over people’s desire to look at a beautiful landscape. The beautiful landscape will have to be sacrificed by putting pylons, turbines or nuclear power plants on it — or Kilroot will have to expand — because we must have energy, and it must be provided, in some shape or form, somewhere in Northern Ireland. We must address each case on its merits and hope that, if the planning departments put the national requirement for energy to the forefront and take into account the local impact, we will achieve a happy medium somewhere along the line.

The Chairperson:

I remember fighting one of the first appeals over a wind turbine — the Bessy Bell wind farm one — in County Tyrone, which was in an area of outstanding natural beauty, and I presented the case for it. However, there are people in south Antrim who feel that a particular area is being covered in wind farms, and they are saying, “Enough is enough. We have wind turbines, but we are not going to look at them everywhere.” Fair play to them. To be honest, there is a case for debate about the big wind turbine at Antrim Hospital; it is right in your face.

Ms McGuigan:

It is absolutely fabulous. It saves the taxpayer a fortune.

Mr T Clarke:

It saves £150,000 a year.

Ms McGuigan:

That is all right.

Mr T Clarke:

Is it worth that saving?

The Chairperson:

I was not talking about value for money. Beauty is in the eye of the beholder. A lot of folk do not think that it is fabulous looking.

Ms McGuigan:

You were referring to the visual impact. If a straw poll were conducted among everyone around the table to find out who wanted a new energy plant, such as the one at Kilroot, built on the outskirts of their town, 100% of you would say no. However, such plants are necessary.

Mr T Clarke:

There might be evidence that wind power will definitely work, but there is a constant emphasis on wind, wind, wind. It looks as though draft PPS 18 will result in presumption in favour of building on areas of outstanding natural beauty, which would be horrendous. Other methods of renewable energy must be developed, such as wood-chip fuel, which would not have the same impact on the visual environment.

Ms McGuigan:

I agree wholeheartedly; a mix of technologies is needed.

Mr T Clarke:

More emphasis is currently being placed on wind.

Ms McGuigan:

No, there is more of an outcry about wind farms because people object loudly to them and the issue is frequently in the newspapers.

The Chairperson:

Everyone who has given evidence to the Committee today has said that there is no other form of renewable energy other than wind. They have said that it is the main source of renewable energy: wind, wind, wind, wind. That is not an outcry against wind; it is an outcry for wind.

Mr T Clarke:

Biomass was mentioned.

The Chairperson:

Compared with wind, biomass has been far down the line in the discussions.

Ms McGuigan:

Perhaps that is because all of the questions were about wind.

The Chairperson:

Today’s presentations focused mainly on the use of wind as an energy source.

Mr T Clarke:

Information on biomass would be useful to the Committee, because we could feed that back into our considerations on farming.

Ms McGuigan:

Biomass, anaerobic digestion and getting gas from slurry should all be considered.

Mr T Clarke:

Those options were covered briefly, but we always finish up talking about wind farms.

The Chairperson:

Is that because they are an easier option?

Ms McGuigan:

Wind is a natural and abundant resource that should be capitalised on.

The Chairperson:

Farm waste is also a natural and abundant resource, yet the same emphasis has not been placed on that.

Mr Elliott:

A development such as that would also result in an outcry. We came across that problem in Fivemiletown. There would be a bigger outcry against energy from waste than there would be against wind farms. I have dealt with both of those issues in my constituency of Fermanagh and South Tyrone.

The Chairperson:

Are you referring to objections to a massive biomass plant, or to a farmer using biomass?

Mr Elliott:

The plant in Fivemiletown was relatively small.

Ms Keelagher:

I am from Fivemiletown.

The Chairperson:

Which meeting were you at? [Laughter.]

Mr Elliott:

The plant was to serve around 20 farmers.

Ms Keelagher:

Those farmers were going to supply waste to the plant.

Mr Elliott:

The plant was to have been relatively small, compared with the Rose Energy plant.

Ms Keelagher:

It was to have been minute. A committee was put together, which visited different plants and experienced issues such as the bad smell.

Mr Elliott:

It was not even possible to move the plant four miles out of the town because of local objections.

Ms Keelagher:

It was suggested that the plant be built on bogland.

Mr Elliott:

You will find that objections will be made against biomass plants.

The Chairperson:

I can assure you that, in my constituency of South Antrim, objections to the Rose Energy site have already begun.

Mr Hardy:

Wind has a higher profile than other sources of renewable energy. It has taken a while for renewable energies to come to the fore, and wind is at the front of the race. The issue of wind farms has become a stick that is used to beat the idea of renewable energy. People raise questions about the impact of wind because it is the most obvious source of renewable energy. I agree wholeheartedly that there are many other potential sources. Wind is used on a commercial scale to provide energy to a large amount of houses, perhaps in an urban setting. However, if an anaerobic digester were put on every slurry tank on every farm in Northern Ireland, only one house in each case would be providing energy, but a massive load would be reduced from the grid.

Urban settings require large, out-of-town, large-scale production, which must come from wind. The Committee should focus on biomass and anaerobic digestion, which enable the rural community to provide energy to urban areas on a large scale.

Mr W Clarke:

The data that we received from Action Renewables in relation to the Reconnect grant stated biomass and solar power as potentially among the biggest energy providing technologies. Wind turbine take-up was very low. The public will decide what they want, and I think biomass is dissipating

Ms McGuigan:

The public is so obsessed with the size of oil bills that biomass is coming into their minds. It must also be taken into account — and this is relevant to the Committee — that the production of biomass is made more attractive by the existence of what are called “renewable heat grants” in the South of Ireland for biomass and solar power technologies.

Northern Ireland farmers have a major incentive to grow crops for export across the border. The difficulty is that if they do, Northern Ireland risks losing its indigenous fuel supply because it has stopped encouraging the use of biomass burners in homes. That is a backward step. The definite agricultural opportunity to supply biomass under contract to the South also threatens the availability of indigenous supplies in Northern Ireland.

Mr T Clarke:

The presentation emphasised the community benefit of wind turbines, but the ones recently erected in south Antrim have been for personal gain and provided absolutely no communal benefit. The perception that all these turbines will help communities is wrong.

The community got nothing from the turbine at Antrim Hospital. Five miles down the road we have another, even larger, wind turbine serving just one family rather than supplying power to the community, which gets nothing from it.

Ms McGuigan:

It may not be a community project but it helps reduce Northern Ireland’s carbon footprint because it feeds into the electricity grid. I doubt that 100% of the power being generated is used on that family’s home.

Mr T Clarke:

The general public gets nothing from that. Fuel prices are the same. In a week when all the talk has been about rising costs, fuel companies announce increases in their profits. That is not because the cost of materials is rising; it is because they want to make more money.

Ms McGuigan:

I would not disagree with that statement.

Mr T Clarke:

It is the same for electricity coming from wind turbines and private enterprises. People are doing it to make money, not out of concern over a carbon footprint.

Ms McGuigan:

A mushroom farmer phoned me yesterday to say he has a substantial energy bill of £1,500 a month, which rises to £3,000 a month during the summer. Every time energy costs rise his competitiveness drops because he faces exporters with lower energy overheads who produce mushrooms more cheaply. The erection of one stand-alone wind turbine on his plant would reduce his energy bills by 50% and stabilise half of those bills at the same level for the next 20 years. That strengthens his position in a very competitive sector of Northern Ireland agriculture.

The alternative is to allow him to be consistently hammered by increased fuel prices that will eventually force him out of business and lead to Northern Ireland importing mushrooms, as it does with so many other crops.

The Chairperson:

That example is balanced because you are speaking about reducing the cost burden of an individual in a valuable enterprise.

Ms McGuigan:

It helps secure the farmer’s business.

The Chairperson:

However, the example presented by Trevor Clarke involves a big energy company coming into an area of outstanding natural beauty and erecting a wind turbine simply for its profits.

Communities object because they get no benefit and they say their lives, even their television reception, are destroyed. Those concerns have to be taken into account. That is the difference between those two examples.

Mr T Clarke:

I want to address my point to Paula. When heating oil for homes was first introduced, everybody changed from using coal to using oil because of the price. Perhaps I am directing my point to you because Balcas is probably one of the biggest producers of wood chip —

Ms Keelagher:

There are now two wood-chip producers in Ireland — we were the only one, now there are two.

Mr T Clarke:

Balcas was the first such company. I am concerned that the price of this form of fuel may increase once people switch to it, as happened with oil. I researched the cost of wood chip a couple of years ago, but how does the price of wood chip currently compare with that of oil? I assume that wood chip would be cheaper, but is it beginning to follow the same trend?

Ms Keelagher:

No, at the minute it is not. Using wood pellets is 50% cheaper than using oil. A tonne of wood pellets costs £118. Because we make our wood pellets from our co-product we do not want to put our price up — it is saving us money to use them in that way rather than having to transport them. So we have a set price for our pellets and that would increase only if there were a rise in the cost of transport or inflation. We have set a precedent in the market. We want to sell the wood pellets — we do not want to be left with 50,000 tonnes of wood pellets in the yard that we cannot sell.

I joined Balcas 18 months ago when it had 500 customers — it now has 3,000. The grants that are available have helped that greatly. The use of biomass is growing all the time; the price of oil is contributing to that. We have 3,000 domestic customers and about 70 commercial customers; by commercial I mean places like hotels, schools and equestrian centres. Schools are considering using biomass more now because they can make a big saving from it.

In relation to tourism, I am not sure whether members are aware of the Share holiday village in Lisnaskea, which has wind turbines, PV and solar panels and four wood-pellet boilers. It is a holiday centre where people with disabilities can get respite care, it organises corporate events and is also a holiday village. The centre is a focal point in Lisnaskea, and Councillor Elliot may agree that a lot of people visit the Share holiday village, where they can see the different renewable resources such as the wind turbines, the solar —

The Chairperson:

Do they not visit the centre for respite rather than to see all of those things?

Ms Keelagher:

It is a holiday village situated by a lovely area of the lake and is one of the tourist destinations to visit in Fermanagh — perhaps not so much because of the renewable resources, but that element is there and is growing.

In Scandinavian countries there are whole towns that are heated by one biomass boiler. At one point, Fivemiletown was going to use biomass to heat social housing, the swimming pool and the high school. It was a great project, exactly the kind that we wanted, but it has been put on the back burner. We at Balcas are trying to encourage the Housing Executive and developers to consider installing community heating, which would involve having one big boiler and one store where the heat can be metred and then used.

The Share holiday village has eight chalets fuelled by one boiler, which is the first mini-district heating system in Northern Ireland. A development of 30 town houses in Enniskillen is going down that route. That will mean that the first such development will be in Fermanagh, which is great for Balcas. We are trying to encourage such developments.

As Ruth said, wind power is always being discussed whereas biomass is not spoken about as much, but there is good interest in it, and it has good potential. As John said, lots of different crops that can be grown, and, for example, miscanthus can also be made into pellets although it may require a different kind of boiler. I do not think that biomass is talked about as much as wind power is, perhaps because you can see a wind turbine in a field, but not a biomass boiler in a person’s house.

Mr Burns:

As you know, the Government estate includes many different buildings — for example, schools, council offices and council leisure centres — and many of those buildings still use oil. Very few of them could be held up as a good example of how a district council is operating its heating scheme. If, as you suggest, you were to have long-term heat contracts to service those buildings, can you explain how such arrangements would work in practice and what sort of organisation would install and maintain the hardware, provide the fuel and manage the process? Do any of your members have such expertise?

Ms Keelagher:

Do you mean expertise in one technology or in all technologies?

Mr Burns:

I mean expertise in helping Government buildings to move away from the use of oil burners and find an alternative method of heating, because using oil in those buildings incurs a phenomenal cost for the rate payer. I know that using oil or gas is very handy because you do not need a stoker or someone to be in charge of keeping supplies topped up, but that comes at an awful price.

Ms McGuigan:

It is a chicken-and-egg situation. People want companies that can do everything, but the market is not there yet. We are getting there, however.

I frequently speak to people who tell me that they do not know what to choose: solar, wind, biomass or geothermal. Different companies have different specialisms. Plumbers will install solar water heating, ground-source heat pumps and underfloor heating. Electrical firms are better at installing wind turbines and photovoltaic (PV) systems. Other people produce the good, and there are different manufacturers. Silver-bullet solutions do not exist. In the construction of a new Government building, as with any building, a mechanical and electrical consultant would be employed and he would subcontract to each of the specialists who would find out which systems were most appropriate. Courses are run by the University of Ulster at Jordanstown to train people in the whole gamut of those technologies. That course will produce specialists.

The Chairperson:

Ruth, is not the problem that there are so many technologies? Is it not time to focus, and take something forward? There is so much choice that we are losing our way.

Ms McGuigan:

I disagree. We have enough expertise in Northern Ireland to make decisions for people — for example, urban homes should not have wind turbines. It is important to ask who will live in the house; whether it is social housing: whether residents will be able to manage delivery of the wood pellets; and whether they will understand how a solar water-heating system works. In that way, the right system can be chosen for each home, in just the same way that, when a house is being built, there is a choice between oil, gas and Economy 7. The decision is made by the house builder to suit the residents. There is enough expertise in Northern Ireland to supply that information, if we really want it.

Mr Hardy:

The renewable-energy industry has sufficient capacity. If the whole Crown estate wanted to switch to wood-pellet systems, there are sufficient people to install, maintain and supply them — and that supply would be adequate.

Mr Burns:

Someone has to put the wood pellets into the hopper that feeds the burner.

Ms Keelagher:

The Committee may not be aware that Hillsborough Castle uses a wood-pellet system. We worked with consultant throughout that installation, because a room was being converted into a store. We transport wood pellets to the castle every two weeks and simply fill up the store. No one has to order: we just do it. Such an arrangement depends on how willing the organisation is to work it. Other companies, with which we have worked, have an energy-service contract with the customer. They install the boiler and storage unit, carry out the maintenance and order the fuel; the customer never sees them. The customer pays for the kilowatt-hours — for the heat, not for the installation. That service is charged at a premium, however.

Ms McGuigan:

In the same way that you would phone the oil company when you run out of oil, you phone the wood-pellet company, and it makes the delivery.

Ms Keelagher:

With bigger customers in particular, we have little contact. We drop off the pellets, and they do not have to worry about it. If we see an issue, we will draw it to their attention.

Mr Hardy:

There is one other important matter. We have a problem with current changes in building regulations. They were supposed to require micro-generation for all newbuilds, but Crown buildings are exempt. There is no requirement in law for installation of renewable-energy systems in new Crown buildings.

Furthermore, many Crown buildings are obtained through public finance initiatives so they will eventually pass into private hands. Crown buildings are supposed to be the first, under the Code for Sustainable Homes, to have mandatory micro-generation, yet they are exempt by law from any such mandatory requirement. The building is already complete when it passes into private hands and the Government may well have installed, for example, an oil-burning system. The likelihood is that the private owner will continue with the existing system. If the building regulations were framed differently, to require new Crown buildings to have micro-generation systems, those renewable systems would pass to private owners who would continue to use renewable-energy sources.

Ms McGuigan:

There is no silver bullet; there is no single renewable energy system that will provide the solution on its own. Rather, there is a wide range of renewables. Those offer the various sectors of the Northern Ireland community opportunities to establish new companies, and develop an energy sector that supplies the people and reduces their insecurity about fuel and energy. If we search for a one-size-fits-all solution — such as wind energy — we risk missing those other business opportunities.

Those opportunities may be small but 80% of Northern Ireland businesses are small and medium-sized enterprises (SMEs). If there is a diverse and competitive market, and if we support a cohesive energy policy across the board, it will naturally fall into place. We must determine what we are going to do, put the necessary policies in place, and go ahead and do it. When that happens, we will reap the benefits across the board, rather than just in one area.

Mr W Clarke:

Is it costly to maintain wood-pellet and wood-chip burners, or do costs vary?

Ms Keelagher:

There are good ones and bad ones. You pay for what you get; you can have a Mini Cooper or a Rolls-Royce, depending on the level of hassle that you are prepared to endure. It is the same as oil systems, in which boilers are serviced once a year.

Mr W Clarke:

Is there a wood-burning system that takes just logs?

Ms Keelagher:

Yes, there are multi-fuel systems.

Mr Bresland:

Can wood chip be burned in a smokeless area?

Ms Keelagher:

Yes, as far as I know.

The Chairperson:

Our main aim in this is to enable members of the farming community to gain financial returns for making alternative use of their land. Development of the renewable energy industry should not compete with farmers’ major function of providing food, but a balance can be struck.

Thank you very much. We like to tease out answers but we deeply appreciate your presentation. Good afternoon.