Renewable Energy Generation

I wish to raise an issue which I know is causing concern for the thousands of households across Ireland that have invested in solar panels and have embraced the transition to clean energy. Recent media reports have suggested the clean export guarantee, the payment introduced by the Green Party and received by households for excess renewable energy exported back to the grid, could be weakened, reduced or ultimately phased out entirely in the years ahead. The clean export guarantee recognises a really simple principle, which is that if households export clean electricity to the grid that electricity has a value and households should be paid fairly for it. Over the past number of years families right across the country have made significant investments in rooftop solar. Many did so because they wanted to reduce their carbon footprint. Many more did so because they wanted to reduce their electricity bills and play an active role in Ireland's transition to clean energy. These households have responded to Government policy. They have responded to national climate objectives. They invested what was often thousands of their own money, often alongside SEAI supports, on the understanding there would be a fair and stable framework for microgeneration. Government policy went even further in encouraging those households. When in government the Green Party encouraged another initiative, the tax exemption for microgeneration of electricity, which is currently valued at €400 per year. Any change to the rules after people have made this investment would send entirely the wrong signal. It would undermine people's confidence in microgeneration going forward. At a time when we need significantly greater development of rooftop solar, community energy generation and distributed renewable generation, the last thing we should be doing is causing uncertainty. Every unit of electricity exported by a household solar installation reduces demand for fossil fuel generation, contributes to energy security and supports our climate targets. I believe the existence of the feed-in tariff acts as a real incentive to people looking to install solar. It gives greater security to people making an upfront payment on panels that investment they are making in clean energy is the right one. The electricity exported from a family home does not suddenly become worthless because it is generated on a rooftop panel rather than in a large-scale facility. Suppliers benefit from this electricity and the wider system benefits from it, and consumers who invest in generation infrastructure should receive an equitable return. I would like confirmation from the Minister of State this evening that there are no plans to wind down the clean export guarantee payment in the coming months and years and that the Government will retain its commitment to it going forward. To provide greater clarity and reassurance to households that undertake microgeneration, can the Minister of State confirm that the tax exemption for the microgeneration of electricity, currently valued at €400 per year, will be maintained as part of budget 2027?

The microgeneration support scheme, MSS, provides supports to both domestic and non-domestic applicants, in the form of grants for solar PV installations, up to a maximum of €1,800 in 2026 for household installations. The domestic MSS forms part of a wider residential retrofit programme that, in line with eligibility criteria, supports energy-efficiency upgrades and the installation of renewable energy technologies in existing housing stock. Since its pilot launch in 2018, the domestic solar PV scheme has gone from strength to strength, with over 123,000 homes being supported. Budget 2026 allocated over €67 million to this year’s scheme. So far this year, over 21,000 homes have been supported. This high level of demand indicates that the scheme is working well and that not only have citizens recognised the significant benefits of investing in solar PV, but that the solar PV industry and supply chain have adapted to the demands of our citizens. The scheme is kept under review to ensure it is operating effectively and making the best use of Exchequer funding. The electricity and gas retail markets in Ireland operate within a European Union regulatory regime wherein electricity and gas markets are commercial, liberalised and competitive. Operating within this overall EU framework, responsibility for the regulation of the electricity and gas markets, including with regard to the clean export guarantee, CEG, is solely a matter for the Commission for Regulation of Utilities, CRU, which was assigned responsibility for the regulation of the Irish electricity and gas markets following the enactment of the Electricity Regulation Act 1999. In line with long-standing policy on deregulating price setting, the CRU ended its regulation of retail prices in the electricity market in 2011, which was 15 years ago, and in the gas market in 2014, which was 12 years ago. Price-setting by electricity suppliers, including remuneration for microgeneration, is a commercial and operational matter for the companies concerned. The Commission for Regulation of Utilities, CRU, published a decision on an interim enabling framework for the CEG on 1 December 2021. This decision outlined the interim arrangements for the implementation of the CEG, including eligibility criteria and remuneration methodology, in line with the requirements of Article 21(2)(d) of the recast renewable energy directive, RED II. The CRU subsequently published a consultation paper in September 2023 with proposals to update the interim CEG arrangements. In June 2024, the CRU published its decision paper entitled Clean Export Guarantee: Enduring Arrangements to Remunerate Customers for Microgeneration Exports. That paper sets out changes to the interim arrangements that were in place for microgeneration. That decision includes improvements in the level of service for customers with microgeneration, such as: more regular payments to customers for the electricity they export to the grid; clearer information from suppliers on the details of the payments that customers receive for the electricity they export to the grid; and that suppliers will have clear information on their websites about their export tariffs. In relation to the development of tariffs under the interim CEG arrangements, the CRU set out in its decision paper of June 2024 that it is of the view that the competitive approach, whereby suppliers set their own competitive export tariffs, has functioned well and will continue.

Gabhaim buíochas leis an Aire Stáit. I am not sure if the response from the Department is going to give a huge amount of reassurance. Ireland's energy transition depends on public participation and the success of microgeneration has shown that people are willing to invest their own resources to support climate action when the policy framework is clear and fair. Many people have pointed out their concerns at the pace at which their feed-in tariff is diminishing at exactly the time that the retail cost of electricity is actually skyrocketing. This raises questions of fairness and undermines people's confidence in the system. I think they may look at the ever-widening gap between the feed-in tariff paid for exports and the unit cost of electricity for households, and, again, that raises those questions of fairness. What we need now is a discussion about strengthening the value proposition for household renewables and not diminishing it. I urge the Government to examine options like a guaranteed minimum clean export guarantee rate; greater transparency and standardisation of export tariffs; and additional protections against any unfair reductions in export payments. Households generating renewable electricity are making a positive contribution to the grid every day. They should not be treated as passive consumers. They are energy producers, climate actors and partners in the transition to cleaner energy. The Government should be making clear that their contribution will continue to be recognised and rewarded through a fair, transparent and durable clean export guarantee framework and through the continuation of the tax exemption for microgeneration of electricity.

As I set out, the electricity and gas retail markets in Ireland operate within a European Union regulatory regime, wherein electricity and gas markets are commercial, liberalised and competitive. Responsibility for the regulation of the electricity and gas markets, including with regard to the clean export guarantee, is solely a matter for the CRU. In relation to the development of tariffs under the CEG arrangements, the CRU is of the view that the competitive approach, whereby suppliers set their own competitive export tariffs, has functioned well and will continue. Separately, while the microgeneration support scheme does provide for the sale of surplus electricity back to the grid, domestic solar PV systems are generally sized for self-consumption. The main benefit for householders and businesses is in offsetting the need to buy some or even most of their required electricity from a retailer, or, in other words, from the grid. There is no limit to the area of solar panels that can be installed on the rooftops of homes anywhere in the country. The Sustainable Energy Authority of Ireland, SEAI, grant is capped at €1,800 for up to 4 kWp of solar panels, but householders can install more if they wish to do so. A typical solar PV installation can meet a large proportion of a home's electricity usage, and the balance can be used through EV charging, diverting it to hot water heating or battery storage. The aim is to maximise the use of solar generation within the home. Using the electricity generated in homes is the most efficient way to get the best return on their investment. The electricity used within the home has a much greater financial value to the homeowner. Every unit of electricity from a PV array used in the home has a value of somewhere between 30 cent and 35 cent, but every unit of electricity exported back to the grid has a value of between 18 cent and 20 cent per unit. Every unit exported, therefore, is worth approximately 12 cent less than if it had been used within the home.