The Micro-Renewable Energy Federation (MREF) is calling for a major overhaul of the second phase of the Small-Scale Renewable Energy Support Scheme (SRESS).
The Department of the Environment, Climate and Communications (DECC) recently confirmed that it is currently developing the “detailed” terms and conditions for the scheme.
Farmers can receive up to €130/MWh for renewable energy export projects under the second phase of SRESS, which will offer support for export-only small scale and community renewable projects above 50kW and up to 6MW.
The department anticipates that the details of the scheme will be finalised over the coming months, with applications due to open before the end of the year.
Renewable energy
However, the chair of the MREF, Pat Smith said that a significant increase is needed on the scheme’s guaranteed export tariff of €130/MWh or 13c/kWh, which he said is below current electricity market rates.
He said that the guaranteed export tariff rate is “being represented as some type of premium tariff payment without the need for an auction”.
He said that this level of payment will only give a premium if the current marketplace price falls below this level.
“The SRESS scheme cannot be just a tick the box exercise for the government to tell community groups and farmers that there is a worthwhile scheme in place.
“While a guaranteed minimum export rate over an extended period is critical for the funding of projects whether via investors or bank debt, the reality is that a 13c/kWh payment for 15 years falls well short of what’s necessary to leave projects bankable.
“Anyone who cares to do the calculations will see that it will take the full earnings from a project over the 15 years to repay borrowings on the investment needed to develop the project in-the first instance.
“This leaves no return for project promoters who put projects together in the first instance,” Smith said.
The MREF chair has called on Minister for the Environment, Climate and Communications, Eamon Ryan and his department to review the scheme to ensure that the export tariff is at a level which allows farmers and communities borrow to invest into such projects.