Element Power welcomed supportive words from UK prime minister David Cameron and taoiseach Enda Kenny, who discussed the matter on Tuesday. The two leaders agreed “it was very important to continue to work closely together on this key issue”, according to a statement from Number 10.
However, last week Irish energy minister Pat Rabbitte said a deal was unlikely to be struck in time for the wind turbines to start generating by 2020. And Element said it needed more detail on the support available to keep investors interested.
Element’s £6.5 billion Greenwire proposal would involve building up to 3GW of onshore wind power capacity in the Irish midlands. Another developer, Mainstream, is aiming to build 5GW to start exporting in 2018.
While the two countries signed a memorandum of understanding in January 2013 to pursue these options, there are various legal and regulatory issues to be thrashed out. Critically, both projects depend on access to UK subsidies.
They are pitching for support under the contracts for difference regime. Wind power generated in Ireland will require a higher “strike price” than that generated in the UK, to factor in the cost of building an undersea cable, but promises “significant cost savings” compared to offshore wind.
Mike O’Neill, CEO of Element Power, said: “This announcement will help reassure investors in Greenwire and other similar projects and is therefore most welcome. However, it is vital that we secure a formalised IGA and clarity on how the UK’s contracts for difference will apply to international projects at the earliest opportunity so that we can proceed to deliver Greenwire in time to help meet 2020 targets whilst saving UK energy consumers billions of pounds, creating jobs in the UK and Ireland, and improving the UK’s energy security.”