Offshore Energy Ahoy!

The Maritime Area Planning Act (MAP Act), which was enacted by the Irish parliament in December 2021, achieved the long-overdue reform of the regime governing development in the maritime area in Ireland. The application process for development is a two-stage process under which an applicant will first have to make an application for a marine area consent (MAC). A MAC is a consent for the occupation of a specific part of the maritime area for the purposes of the proposed maritime development. Secondly, an application for planning permission will have to be made to the relevant onshore planning authority or An Bord Pleanála (the Board) as appropriate.

The MAP Act will establish a new agency to regulate development in the maritime area, which is to be called the Maritime Area Regulatory Authority (MARA). The MARA is expected to be established at the latest by Q1 2023. Under the special transition provisions of the MAP Act and until the establishment of MARA, the Minister for the Environment, Climate and Communications (the Minister) has the responsibility for assessing and granting MACs for this first phase of offshore projects.

This specialised process applies to Ireland’s “Phase One” projects, each of which had already advanced under the Foreshore Act 1933, and provides a pathway for development for these projects in order to contribute to the achievement of Ireland’s 2030 renewable energy targets. The Phase One projects are those projects which satisfy the definition of “relevant maritime usage” under Section 100 of the MAP Act.

Phase One timelines

MAC – The MAC application window will open for a period of approximately 8 weeks from Monday 25 April 2022, closing at 5.30pm on Wednesday 22 June 2022. Assessment will begin from the date of submission of a complete MAC application.

Planning Permission - Following receipt of a MAC, expected by Q3 2022, successful projects will be eligible to consult with the Board to apply for planning permission. This process will include a full statutory consultation and environmental assessment.

Grid - All transmission assets for Phase One projects, including assets located offshore, will be built by the developers. They will be transferred, at an agreed stage, to EirGrid. It is intended that EirGrid will issue grid connection assessments to qualifying Phase One projects by Q3 2022.

MAC Application Process

A MAC application fee of €25,000 will apply.

To be successfully granted a MAC, Phase One projects will need to demonstrate their suitability in certain MAC assessment areas, which includes the following:

• Technical Assessment
• Financial Assessment
• “Fit and Proper Person” Assessment
• Geographic coordinates - must be consistent with original foreshore lease application and must provide evidence of intent to surrender an existing lease if applicable
• Consistency with offshore energy policy

The term of a MAC will run for 45 years.

Levy framework

The holder of a MAC is required to pay for same by way of a “levy” charged by the Minister.

Two different levy rates apply during the life of the MAC: a development-stage levy, which will apply from the point of award of a MAC until the project reaches Commercial Operation Date (COD), and then an operational-stage levy from COD to the decommissioning stage.

• A development-stage levy rate of €20,000/km²/annum will apply, indexed to Harmonised Index of Consumer Prices
• An operational-stage levy rate of 2% of gross revenue will apply, with a minimum annual levy equal to the development stage levy
• The associated cable corridors will be exempt from the development levy

This is the first time that the new MAP Act will be put into action and the transitional version of the new consenting regime put to the test. With the application window just weeks away from opening, developers of Phase One projects should be getting their “ducks in a row” to submit their application so assessment can begin as early as possible.

The Department of the Environment, Climate and Communications has issued Guidance for the qualifying Phase One projects and this should be consulted by any developer who intends to make a MAC application within the prescribed window from 25 April 2022 to 22 June 2022.

For more information, contact a member of our Energy team.

The content of this article is provided for information purposes only and does not constitute legal or other advice.