Budget 2007:Mr Cowen introduced a bio-energy establishment scheme to provide grants to farmers interested in planting willow and miscanthus for the generation of heat and electricity.
The Budget increased the grants scheme for renewable energy for 'greener' homes by €5m to almost €10 million next year. The scheme provides grants for technologies such as solar panels.
Mr Cowen said there is also provision for additional spending on this measure of €7 million in 2008 and €8 million in 2009.
In addition, the bio-heat scheme to cover the installation of commercial wood-burning boilers and other technologies in commercial premises, community centres and sports facilities has been increased by €1 million this year.
The Minister said this measure, together with a reallocation of resources with the Department of Communications, Marine and Natural Resources, will increase the spending on this area by €3 million in 2007.
He said production of these crops is relatively undeveloped in Ireland mainly due to high establishment costs, estimated at €2,800 per hectare for miscanthus and €2,900 for willow.
The scheme is for a limited period and will require EU state aid approval.
Some €2 million is being provided in 2007, with a further €2.5 million and €3.5 million being provided in 2008 and 2009 respectively.
The State will also introduce a national top-up of €80 per hectare on top of the existing EU aid of €45 per hectare for energy crops.
Mr Cowen said the objective is to increase the areas sown under energy crops from the current level of 3,000 hectares to up to 70,000 hectares over the next number of years.
A special scheme of supports is planned to grant-aid biomass harvesting machinery, such as harvesters and chippers for processing of forest biomass. A total of €0.6 million is being provided in both 2007 and 2008 for this measure.
The national energy agency Sustainable Energy Ireland will be given an additional €3 million for a pilot scheme to support SMEs in assessing their energy usage and measures to enhance energy efficiency.