The fact that Bord na Móna, which is ultimately owned by Irish taxpayers, has found it makes more commercial sense to invest in a new €60 million biomass plant in the US rather than Ireland should be of concern to policymakers.
Bord na Móna must move away from its core, environmentally dubious activity of peat supply. Biomass will be at the centre of this push in coming years, and the company this week announced the launch of a new bio-energy division.
As part of its new strategy, it needs to invest in a steady supply of wood and wood pellets for biomass fuel. It will then supply this material to other companies, and also burn it as fuel for its own power-generation activity.
Bord na Móna has chosen to make this investment on a rural site in the American state of Georgia. The Irish company has been tempted across the Atlantic by a slew of incentives from Georgia’s public authorities, including tax credits.
The proposal has gone for approval to the Government’s NewEra unit. Couldn’t the taxpayer-owned company be forced to make the investment at home instead?
No, it says. For a start, the subsidies here for renewable energy power generation wouldn’t cover the costs of biomass production and acquisition in Ireland.
There is also a major shortage of biomass material (wood fibres) in the Irish market – farmers here don't grow enough forestry to meet demand. And most of those who do already have contracts to supply the State forestry agency, Coillte.
Bord na Móna was all set to merge with Coillte in recent years, before the plan was later abandoned by the Government. If the merger had gone ahead, Bord na Móna presumably wouldn’t now have a supply problem. Instead it must now compete with its fellow semi-State for raw materials.
The Government must, surely, bring in some sort of biomass production incentive for farmers in the upcoming budget to meet the growing demands of the two State companies, as well as the ESB, which also must be weaned off peat for electricity production in coming years.
Then there is the issue of planning. Aside from a steady supply of wood from farmers in Georgia, one of the primary reasons Bord na Móna chose to go the southeastern US state is because the authorities there promised to deliver planning permission within a matter of days, once the application is made.
That alone should be food for thought for Irish Ministers. Just ask the people of Athenry in Galway, who have been waiting on permission for a new Apple plant for more than 2½ years.