Six years ago, with a debut album and a Mercury Music Prize nomination, a cocky Gemma Hayes set off to conquer the world. But the resulting music "didn't work", and now an older, wiser Hayes is touring again, and about to release her fine third album. She talks to Jim Carroll

THERE HAVE been lows. That night in New York was one of them. The room in Joe's Pub in the Public Theatre on Lafayette Street is a tough one to play, and it's even tougher when you're as nervous as she was that night. Her manager had to drag her onstage, coax her, placate her, reassure her. She stood there on that dumpy little stage in the corner behind her microphone, facing a room jammed with cross-armed critics and press and radio people. All watching, all waiting to be impressed.

And she bottled it. The nerves got to her. She'd always felt nervous playing a show but this was the worst. "Usually, I'd be okay after one of two songs, but it got worse and worse. I had to stop in the middle of a song because my hands were shaking so much."

Gemma Hayes smiles now as she remembers that night. She doesn't get nervous anymore. She worked it out. "There's no trick; your body just can't physically take being that nervous all the time."

Yeah, there have been lows. Her second album, The Roads Don't Love You, might have been another one of them. She went off to Los Angeles to record it, as giddy as a goat about the adventure. Her debut album, Night on My Side- the one she says was "all over the shop" - had done better than everyone expected.

"It was folk, it was rock, it was distorted, it was girly, it was a whole bunch of different albums pushed together. I was told by my label that it wasn't easy to market and it would be hard for people to listen to, so I didn't expect anything to happen."

But stuff happened. Good stuff. She landed great reviews, a Mercury Music Prize nomination and a whole bag of cockiness under her oxter as she caught that plane to the sun and the haze of California.

"I wanted to go to LA and make a pop album along the lines of The La's and There She Goes. I dream about writing a song as good as that. I haven't done it yet, though. I wanted to work with top session musicians to know what all the fuss was about.

"During the recording, though, there were just too many opinions going around. I wanted album two to be super-structured, but I overdid it and it sounded too regimental. It didn't work."

But in sunny Los Angeles, as she realised that maybe this second album was falling between stools, the Tipperary lass found herself falling for the city. She met a bunch of friendly people. Her manager's apartment meant she had free digs in the city, and there was an abundance of cheap rehearsal spaces. She'd jam with various musicians on a whim and they'd play shows on a Monday or Tuesday night to 40 or 50 people.

Gradually, she found herself falling back in love with music, a strange feeling to have after releasing two albums.

"After the second album, I couldn't write songs for ages because I was blaming music for all my troubles. Ridiculous stuff like that. But it was the industry, not the music, which was really at fault. Music has never let me down . . . I had to snap out of that way of thinking and realise that the music is the best part of what I do."

When she received her marching papers from the label, Hayes figured she had two options. Option one was the easy way out. "I actually thought, you know what, this is too hard. I wanted to go back to college and play music just for enjoyment. This thing about trying to stay true to myself in the music industry was killing me."

Option two was go straight into a studio to start writing and recording.

Hayes takes a swig of orange juice and grins. "Of course, I chose option two."

She rang her old friend and producer Dave Odlum and said she wanted to start working on another album. She rented a house in Kerry in the depths of winter ("it's cheap and you're isolated from the world"), watched TV, faffed about and wrote a few songs.

She went to the Black Box studios in France before returning to LA. When they were ready, she would e-mail sound files to her other longtime collaborator, Karl Odlum, and he began the process of turning them into shimmering gold in his house in Monkstown, Co Dublin.

She rang Kevin Shields and asked him to play guitar on one of the tracks. They'd duetted together on Gillian Welch's Whiskey Girlat one of her London shows, he on distorted guitar and she on bittersweet acoustic and vocals. Shields said no problem.

You'll be able to hear it all on Gemma's new album, The Hollow of Morning. It will get under your skin with its blissed-out atmospherics and ethereal songs. You'll keep it with you because it will remind you of fond memories, half-remembered dreams and the sunny bliss that music can occasionally provoke. It's the album Hayes should have made after her first one and, well, you kind of feel she knows that too.

So much has changed since Night on My Sidebrought her out of the shadows.

Six years ago, in the same Dublin hotel bar we're in today, this interviewer and that interviewee met to talk about her debut album. The interviewer went away afterwards, his tape-recorder full of the sheer confidence and hard-headed ambition and bravado of the interviewee. As sharp as a tack, Hayes already had a BA in the music industry's bullshit, shenanigans and machinations, and was well on her way to a MA. No one, but no one, was going to fool this girl.

That creature was bossy Gemma, she says. "I've lost that intense ambition, it's not as important to me any more. A healthy amount of ambition is good, but I remembered just in time that I got into this because I enjoyed music and enjoyed playing music. And I did enjoy it at the start, but the ambition got bigger than the enjoyment."

She looks back at that young firebrand marching off to take on the world and shakes her head at the memory. "When I was 19, I thought I had to educate myself about the industry so I wouldn't be ripped off or seen as a fool. I had to know what I was getting into. It was good to do my homework, but I'm not a businesswoman, and the time and energy fighting all these battles started to eat away at the space that should have been kept for music."

Back then, Hayes was also aware that she didn't quite fit in with what was going in Dublin. These days, as she flits back and forth between Ireland and Los Angeles, it doesn't bother her as much. Chalk it down to maturity, or a sense that scenes ultimately suck.

"I know I've never really fitted in with what was going on here. All my business dealings were in London. I was signed to an English label, my manager was in England, I didn't and don't have any dealings with the Irish industry. There was a Frames scene and I didn't fit in with that. I was a part of that singer-songwriter scene, but some of my music didn't fit in with that. I never locked in with any one scene, but it did me no harm. I still feel like I'm hovering around in a spaceship waiting to land."

Hayes marvels at what contemporaries such as Glen Hansard, Paddy Casey and Bell X1 are doing. "I was in a pub in Boston last month having a pint and there was an ad for Bell X1's Flockon the coaster stuck to the glass. You can't escape them."

Since EMI stopped paying her recording bills in 2005, Hayes has been content to sail on alone. The new album will come out in Ireland and Britain and that's it for now. She's happy with this. "It's not a good time to sign a record deal because the record industry doesn't know what it is doing. I'll hold on."

She still has her publishing contract and she can always tour, even if touring is not all beer and skittles in her mind. "When people talk about the music business being all about live music, I just think of the egg-and-cress sandwiches you get at motorway petrol stations. Once I'm on a stage playing songs, it's great. It's the other 23 hours of the day which make it so unattractive. Driving from city to city, being in a bus with other people with no space, being away from home. It's hard work."

In Gemma's ideal world, it would be just her and her music and maybe that spaceship from a few paragraphs ago to get her to gigs on time.

"I know now that's what is important. I love the new album because the intentions behind the songs are a lot calmer. The drive to take over the world isn't there anymore and it's lovely. The bossy Gemma has let the other Gemma out to enjoy herself.

"I don't know if that's a bad or a good thing, but it feels good."

• The Hollow of Morningis released on May 2nd. Songs from the new album can be heard at  www.myspace.com/gemmahayes. Hayes plays Cork's Cyprus Avenue on April 23rd, Limerick's Dolan's (24th), Castlebar's Royal Theatre (25th), Galway's Róisín Dubh (27th), Belfast's Spring & Airbrake (28th) and Dublin's Tripod (29th)