Dr Jonathan Healy, ForfásSecretariat to High-Level Group on Green Enterprise

DKIT, 2/2/10

Content

1. What are ‘green’ jobs?

2. What is the potential for the Green Economy in Ireland?

3. What is required to deliver the opportunity? – Focus on skills

Forfás and ITI report (October 2008)

HLAG Members

• Appointed by Tánaiste• Senior Civil and Public Servants (Ass.Sec.)• Entrepreneurs• Civil society

1.What are ‘Green’ Jobs?

Amorphous Traditional and cutting-edge

Renewable energies Consultancy Energy efficiency Waste management Water / Wastewater

2. What is the opportunity?

Global Market Expected to grow to $800 billion by 2015

OECD countries will account for 90% of growth

Expect strong growth from China & India & CEE

EGS performing strongly despite downturn

Other countries are moving to capture these opportunities

USA Create millions of new jobs

$150 billion investment in clean energy over 10 years

In 2000 energy technology represented 1% of all VC investments. Now it is 10%

$11 billion investments in Smarter Grid

$112 billion as part of its Green Economic Stimulus Package

Other Green Stimulus Plans France: $7 billion has been

allocated

Germany: $14 billion

South Korea: $31 billion

China: $221 billion

Represents a sizable portion of the Chinese and Korean economic recovery funds

Irish market All-island market estimated at €2.8 billion by Forfás (excluding eco-construction) in

2008

Supports 11,000 jobs on island

Dominated by:

Water

Renewable energy

Environmental consultancy

and clean technologies

Waste/ wastewater

€m

560, 20%1,000, 35%

700, 25%

550, 20%

Environmental Consultancy andClean Technologies

Renewables

Waste Management

Water & Wastewater

Opportunities for Ireland Excellent natural resources (wind and ocean)

Increasing levels of R&D

Strengths in related cross-over sectors (finance,

construction, ICT hardware (sensors) and software,

food, tourism) – indigenous and MNC

Drive to reduce key business costs

(e.g. energy, waste and water)

International reputation as a ‘Green Island’

Potential for first-mover advantage from demanding international regulatory drivers (including: Kyoto, EU ETS, ’20-20-20’ targets, Copenhagen, EU target of 50% Green Public Procurement by 2010 on tenders)

Strong potential for job creation Extremely difficult to estimate accurately Based on international growth projections, potential to create ~80,000 jobs in

Ireland over the next decade Where?

• Renewable energy sector: over 50,000 direct jobs by 2020 (Biopower plc)• Eco-construction: 23,000 – 32,000 (IIEA)• Waste (e.g. composting and anaerobic waste: 1,500 (InterTradeIreland))• Water (no estimates available)

International evidence suggest the majority of these jobs will be high-skill, high- value-added jobs (i.e. smart economy jobs)

3. What is required to deliver the opportunity?

Policy recommendations

3.1 Opportunities that can drive exports and jobs Renewable energy – driven by rising cost of fossil fuels

o Ireland is among most favourable locations for wind and wave energy in the world and we are close to key markets.

o R&D base emerging and convergence with ICT offers significant opportunities.

Energy efficiency – driven by cost competitiveness pressures

o New-build and retrofit (eco-construction), new products (advanced materials/appliances) and new services (energy management).

Waste – driven by cost pressures and regulatory demands

o Opportunities exist across the waste value chain.

Water & wastewater – driven by dwindling global water resources

o Opportunities in leak control, monitoring and supply networks, and water analysis.

Other o Eco-tourism, agriculture (e.g. organic farming, forestry, bio-energy, etc.), retail and

leisure, transport, etc.

Key actions to capture opportunities

Renewable energy

Continued development of electricity grid – domestic and international linkages to UK/ Europe

Develop ICT capabilities of grid (e.g. smart meters)

Energy efficiency

Energy-efficiency standards for buildings to be strengthened

Introduce incentives

o Reduce stamp duty on low-carbon homes

o Introduce CO2 tax as recommended by Commission on Tax

Use revenues from EU ETS to fund State-backed energy-efficiency and green economy initiatives

Key actions to capture opportunities

Waste

Create a single all-island waste market by removing regional waste regions and North-South barriers to trade in recyclable material

Create regulatory certainty in market by finalising regulatory structures

Promote composting and anaerobic digestion

Water & wastewater

Shift public investment towards reducing allowable levels of unaccounted-for water to develop Irish expertise in leak control, monitoring and supply networks

Create national market for water by establishing national water authority and introducing volumetric pricing

3.2 We also need to:

Deliver green zones and a green IFSC

Create world-class R&D centres

in niche areas

Remove basic hurdles to the green

economy

Deliver green zones and a green IFSC Ireland needs to develop green zones in order to create an environment that

supports development of green enterprise and to market Ireland overseas.

Immediate opportunity exists to develop a Green IFSC incorporating green investment vehicles, green fund administration, carbon trading and associated professional services.

We can build on existing strengths. IFSC group is exploring opportunities and actions required.

Create world-class R&D centres in niche areas

As highlighted in Smart Economy, key challenge for Ireland is to develop a small number of world-class R&D centres

We need to develop networked EU Energy Research Centre by:

o Pooling expertise into key centres

o Consolidating R&D funding programmes

Further develop our energy research strategy, and develop clear strategies for water and waste

To realise benefits from this investment, we need to position Ireland as a test-bed location for green enterprise activities and address a range of basic hurdles

What Skills Are Needed?

Environmental engineeringICTFinanceInsurance / ActuarialAgri scienceEco-constructionArchitecture / Design / DraughtsmanshipEnergy PhDs

Skills

Convergence - ICT, biotechnology, nanotechnology (e.g. IBM)

Substitution - fossil fuels to renewables, landfill to recycling and AD

Diversification – traditional to cutting-edge (Glen Dimplex)

Good transferability via re-training or ‘greening’ of traditional jobs – e.g. plumbers, electricians, metal workers, construction workers

Specific niche areas: environmental engineers , environmental impact assessors, design engineers, building energy assessors, energy consultants

As well as specific technical and professional skills there will be a requirement at all levels for generic competences - e.g. strategic leadership, creativity, innovation, team-working, adaptability and communications skills

Recent HE coursesB.Sc Renewable and Electrical Energy Systems, University of Limerick, Level 7 which commenced in 2005.  B.Eng Mechanical Engineering and Renewable Energy, Level 7, Athlone Institute of Technology,  B.A. Energy and Environmental Engineering ,Level 7, Institute of Technology, Tallaght  Sustainable Energy, Level 8, Cork Institute of Technology B.E. Energy Engineering, Level 8, UCC M.Sc. in Energy Management, Dublin Institute of Technology, Kevin Street.  A new Bachelor of Engineering in Energy Systems is commencing in NUIG Several environmental related programmes providing over 200 places have just been approved under the Labour Market Activation Scheme. E.g. Certificate in Sustainable Energy Systems, Level 6, Cork Institute of Technology Higher Certificate in Energy Engineering, Level 6, Galway Mayo Institute of Technology Higher Certificate in Wind Engineering, Level 6, Letterkenny Institute of Technology B.Eng. in Mechanical Engineering and Renewable Energy, Athlone Institute of Technology  BSc in Sustainable Electrical and Control Technologies, Institute of Technology, Blanchardstown.  Bachelor of Engineering in Energy and Environmental Systems, IOT Tallaght.  Certificate in Environmental Science in Renewable Energy, Level 7, Shannon Consortium, (UL, MIC, LIT, IT Tralee).  Certificate in Environmental Science, Level 8, Institute of Technology Tralee  Certificate in Renewable Energy, Tralee Institute of Technology  Degree in Energy Engineering, Galway Mayo Institute of Technology

We need to be agile to build competitive advantage Green Economy offers huge potential – other countries are moving to

capture these

Ireland has range of strengths in this emerging sector and a wide range of initiatives are being progressed to position Ireland

HLAG report seeks to develop an action plan to progress development of relevant sectors. Many recommendations can be implemented at little or no cost in a short time period.

Group recommends:

Minister or Minister of State be charged with responsibility

Cabinet Committee, chaired by the Taoiseach, to drive implementation

Dr Jonathan HealySenior Policy AnalystForfás

E-mail: Jonathan.Healy@forfas.ie

Tel: (01) 607 3273

www.forfas.ie/publications