PLATFORM: An energy crunch will follow the credit crunch if Ireland persists in relying on fossil fuels, writes FEARGAL QUINN

IT IS a time for questions. The financial and economic crisis that has convulsed the world in recent months has prompted an array of justifiably angry interrogations by citizens of their policymakers, their regulators and their bankers. How was this allowed to happen? Why was nothing done to stop it? How was it not spotted sooner?

Even if answered to our satisfaction, these questions will do little to extricate us from the current catastrophe, but they may have the salutary result of stopping another disaster in global finance.

Even more hopefully, such questions might also dispose us to listen more carefully to those lonely, dissenting voices that point out the fragility of other foundations of our economy that we have simply taken for granted and assumed to be in good health.

One such foundation has the potential to destabilise our economy with the same violence and upheaval as the financial crisis. It is the issue of energy supply and Ireland is blocking its ears to any solution or discussion of this problem.

Just as we blithely assumed that debt securitisation, over-leveraging and the shadow banking system did not create undue risk in our economy, so now are we equally sanguine about our sources of electricity. In Ireland, we rely on coal, oil, gas or peat for about 90 per cent of our electricity with no inkling of further problems down the line for fossil fuels.

Admittedly, it is hard to feel any urgency about this at present. After all, crude oil is dropping to levels last seen almost four years ago, and gas and coal both follow the price of oil. So why worry if the fuel is so cheap?

The reason is that fossil fuels are finite and subject to supply disruption and can easily spike up in price again. We cannot build a sustainable energy policy by looking at what has happened in the last three months, or even the last three years. Cheap oil, like cheap debt, cannot be relied upon. As countries around the world develop, they too will need fuel for their economy, and over the long term, greater demand will push up prices.

Fossil fuels are also incredibly damaging to the environment. We produce carbon dioxide every time we boil our kettles, play our DVDs, or wash our clothes.

The environmental cost of CO2 has also turned into a financial cost because of our Kyoto commitments. So even if coal or gas itself is cheap, we still have to pay to emit carbon. Ireland has spent approximately €230 million per year on buying credits under the Kyoto scheme to pay for our carbon emissions. Thus, over four years, our expenditure on emissions credits is €920 million.

Is it wise to be spending so much on a vicarious carbon mitigation programme, when we could be emitting less carbon into the air in the first place? There is one option to help reduce our carbon emissions, and free us of reliance on a dwindling resource that is subject to such dramatic price spikes: nuclear power.

The money we spend on four years’ worth of carbon emissions credits is just shy of the €1 billion it would take for Ireland to build a medium-sized nuclear power station. The cost of decommissioning a nuclear plant might add another €250 million or so to this figure but, even still, this looks like a calculation that is worth examining in more detail.

The issues around nuclear waste and safety are serious but I do not believe they are insurmountable. In the western world, nuclear power has proven to be a safe, cheap and clean source of energy, using a fuel that is abundantly available.

If we are confronted by another price spike in oil or wholesale gas, Ireland will have no easy alternative. We cannot suddenly turn to nuclear then – because the lead-time on any new construction is 10 years. This economic recession may take a year or two to ride out but, when we do recover, it would be terrible to be then hit by a painful energy squeeze that could take even longer to ride out because we failed to prepare for it.

Short-term thinking has been discredited in finance and must now be challenged in the field of our energy supply. The generation that brought Ireland its political independence also laboured to bring us independence in energy by harnessing the Shannon, making Ardnacrusha, for a time, the largest hydroelectric plant in the world. Thanks to their foresight, 10 per cent of Irish electricity comes from hydroelectric power over 80 years later. We need similar foresight now. We must continue to invest in hyrdoelectric power and also in wind power to secure a diverse energy mix, but even Denmark – the most advanced nation on earth in terms of its use of wind power – can only get 20 per cent of its electricity from that source.

If we kept and even expanded our hydroelectric plants, and had Denmark’s success with wind, we would still need to make up the remaining 70 per cent of our electricity needs from something else. For the long-term future of Ireland, that cannot be fossil fuel. We must at least examine the possibility of nuclear energy.

However, Ireland is unable to even consider nuclear power plants because of official State opposition to it. We have even written into law as part of the Electricity Regulation Act of 1999 that Ireland cannot build nuclear power stations. Precluding even the consideration of nuclear power is storing up problems.

Can we afford to persist in imposing a policy gagging order on nuclear power? It is a time for questions.

Feargal Quinn is an independent member of Seanad Éireann and chairman of EuroCommerce