Support for Household Energy Bills: Motion (Resumed) [Private Members]

The following motion was moved by Deputy Darren O'Rourke on Wednesday, 3 May 2023:

That Dáil Éireann:

recognises that unsustainably high energy bills continue to put workers and families under significant financial pressure;

notes that:

— the average cost of gas and electricity bills has doubled over the last year;

— the price of electricity in Ireland is the highest in Europe, and the price of gas is the eighth most expensive according to a European Household Energy Price Index;

— the number of people living in energy poverty has doubled over the last year, and at its peak was reported to be at a record breaking high of 40 per cent;

— one in five Irish homes are now behind on their gas bills, of those 679,000 people rely on gas to heat their homes, and 139,785 were in arrears at the end of December, with this rising to 152,276 by the end of February; and

— wholesale gas and electricity prices have fallen significantly, yet there have been no efforts to pass this on to consumers, in addition wholesale electricity prices have dropped by 50.5 per cent in the last year, a decrease of 8.7 per cent since February;

further notes that:

— there is inadequate regulation in the energy market;

— the Commission for Regulation of Utilities (CRU) lacks the regulatory power, resources and mandate to adequately regulate the energy market;

— there is an increasing trend for energy companies to use standing charges to increase their profitability, and in some cases, the increase was more than €300, and the CRU does not have the legislative remit to address standing charges; and

— two of the State's largest energy providers, Electric Ireland and Bord Gáis Energy, have recently made blunders in their billing process, putting thousands of workers and families in even more financial hardship during a raging cost-of-living crisis;

regrets that:

— on 1st May, the Government have again chosen to increase the carbon tax, which has increased the cost of home heating oil, peat briquettes and natural gas for household use for workers and families;

— the Government have prioritised the profits of energy companies over workers and families at every turn, and their efforts to shield consumers from rising energy costs are weak and comparatively thin when compared to other European Union (EU) member states;

— the Government has also failed to introduce electricity price caps when they are commonplace amongst many EU member states;

— the Government measures to address windfall gains in the energy sector are wholly inadequate, and despite the European Council Regulation (EU) 2022/1854 coming into effect in October, the Government did not make an announcement until November and legislation was not introduced until late March, for which we are still at the stage of pre-legislative scrutiny;

— the Government blocked attempts to introduce a windfall tax, only doing so when compelled to do so when the EU, as a whole, did so through the introduction of regulation 2022/1854 to address windfall gains in the energy market;

— the regulation does not go far enough to address these windfall gains, and with reference to the cap on market revenues in particular, the regulation does not provide for member states to address the periods where they were at their peak; and

— the Irish Government has elected to introduce the cap on market revenues for the minimum period of December 2022 to June 2023, while other EU member states have recognised the weakness in the regulatory measure and introduced taxes to address their super-profits, with Austria, France, the Netherlands and Belgium all having introduced taxes which enable them to address the super-profits earned in the summer, and similarly Germany and Poland have introduced other levies which address profits in the period after the regulatory measure ends; and

calls on the Government to:

— introduce a windfall tax which addresses the super-profits of energy companies when they were at their peak in 2022;

— provide financial relief and certainty to households by reducing electricity prices for households to their pre-Ukraine War levels, and capping them at that level as done in Germany, Austria and the Netherlands;

— reverse the increase in carbon tax; and

— introduce new regulatory powers for the CRU, including the legislative remit to address standing charges, to review practices of hedging and investigate possible instances of price gouging, and ensure that it is resourced to do so.

Debate resumed on amendment No. 1:

To delete all words after "Dáil Éireann" and substitute the following:

"acknowledges the Government's response to the significant increases in energy prices for households and businesses due to the Russian invasion of Ukraine;

notes that:

— the European Council Regulation (EU) 2022/1854 provides for a cap on market revenues in the electricity sector and a temporary solidarity contribution based on taxable profits in the fossil fuel production and refining sectors;

— on 22nd November, 2022, the Government announced the decision to introduce measures to address windfall gains in the energy sector through the implementation of European Council Regulation (EU) 2022/1854 on an emergency intervention to address high energy prices;

— a general scheme of this legislation was approved by Government on 21st March, 2023, and the legislation to implement this Government decision is currently being drafted;

— the Government decided to set a cap of €120 per megawatt hour (MWh) for wind and solar, which goes further than the EU Regulation of €180 per MWh in order to fully capture windfall gains, whilst maintaining appropriate future investment signals, and the excess revenue will be collected and used to support electricity consumers;

— the cap on market revenues will operate from December 2022 to June 2023 inclusive, as set out in the Council Regulation;

— the Government has decided to implement the temporary solidarity contribution of Council Regulation (EU) 2022/1854 on fossil fuel production and refining companies that earn unexpected surplus profits in 2022 and 2023;

— the Government has decided to implement the temporary solidarity contribution to apply to taxable profits which are more than 20 per cent above the baseline period from 2018 to 2021, which will be subject to a rate of 75 per cent, and losses from previous years will not be considered in the calculation of the taxable profits; and

— the proceeds to be collected from the implementation of European Council Regulation (EU) 2022/1854 are estimated at circa €280 million to circa €600 million, however the proceeds are highly dependent on the level of wholesale gas prices over the coming winter;

further notes that:

— the Government introduced a €2.4 billion package of supports during 2022, and an additional package of once-off measures worth €2.5 billion was included in Budget 2023;

— in February, the Government announced a €1.2 billion package to help families, businesses, pensioners, carers and people with disabilities, including:

— families with children will receive a bonus Child Benefit payment of €100 per child in June;

— a once-off €100 increase in the Back to School Clothing and Footwear Allowance in July;

— the Hot School Meals programme will be extended to all primary schools in the Delivering Equality of Opportunity in Schools programme from September, benefiting 64,500 children;

— a second lump sum of €200 will be paid in April to people on the Working Family Payment, lone parents, low-income families, carers, those on disability payments, and pensioners among others;

— lower Value Added Tax (VAT) and excise rates will continue to apply on gas, electricity, petrol, diesel and Marked Gas Oil until October;

— simplified application process for the Temporary Business Energy Support Scheme (TBESS) and the level of relief has been increased to 50 per cent of the cost of eligible energy bills; and

— the 9 per cent VAT rate for hospitality is extended to August;

— in April and May 2022, 99 per cent of eligible domestic electricity accounts were credited with the first Electricity Costs Emergency Benefit Payment of €176.22 excluding VAT, with the total cost of this scheme being just under €377 million and this was of benefit to over 2.1 million households;

— under the second Electricity Costs Emergency Benefits Scheme, the first of three further €200 electricity credits was applied before Christmas, the second payment was credited to bills in the January/February billing cycle, and the final payment of support was applied during the March/April billing cycle;

— as of 6th January, 2023, the number of domestic electricity accounts in receipt of their first credit was 2.15 million meaning 99.1 per cent of all eligible customers have now had the credit applied to their account;

— combined with the first Electricity Benefit Scheme, over 2.1 million households will have automatically received €800 of income support through their electricity bill at a total cost of €1.59 billion between Q2 2022 and Q2 2023;

— this is in addition to increased funding for supports such as the Fuel Allowance, reduction of VAT on gas and electric bills, reduced excise duty on petrol and diesel and a total allocation of €267 million (of which €202 million is carbon tax receipts) to Sustainable Energy Authority of Ireland (SEAI) residential and community schemes, including those targeting households at risk of poverty in 2022;

— in 2023, a total of €235 million will be spent on SEAI dedicated energy poverty schemes and Local Authority retrofits, and this funding will target 6,000 free upgrades under the Warmer Homes Scheme and a further 2,400 B2 retrofits of Local Authority homes next year;

— separate to the Fuel Allowance scheme, the Department of Social Protection pays an electricity or gas allowance under the household benefits scheme and a further €203 million will have been spent on the scheme in 2022, and over 483,000 households have been expected to benefit from this;

— in 2022, 4,438 free upgrades were provided to homes at risk of energy poverty through SEAI's Warmer Homes and Warmth and Wellbeing schemes;

— the Commission for Regulation of Utilities (CRU) ended its regulation of retail prices in the electricity market in 2011, and in the gas market in 2014, and given that prices are no longer regulated, they are set by suppliers as entirely commercial and operational matters by them, with each company having its own different approach to pricing decisions over time, in accordance with factors such as their overall company strategic direction and developments in their cost base;

— the CRU further extended the moratorium on disconnections for all bill-pay customers until the end of March 2023, and this is in addition to the strengthened consumer protection measures announced last September which are now all in place, and these measures include a stipulation that suppliers must offer payment plans of up to 24 months; and

— the Energy Poverty Action Plan, launched in December 2022, provides for the establishment of a €10 million fund to further support people in, or at risk of, energy poverty and provide a further safeguard to help people who may not be able to access other sources of assistance such as the supplier hardship funds, or the Additional Needs Payment scheme operated by the Department of Social Protection, while the Department of Environment, Climate and Communications are working to establish this fund in advance of winter 2023/24;

further acknowledges that:

— carbon tax will see an annual increase of €7.50 per tonne each year to 2029, then €6.50 in 2030, and this will raise an estimated €9.5 billion over that period, money to support those at risk of energy poverty, as well as retrofitting programmes, agri-environmental supports for farmers and the Just Transition Mechanism fund, and in particular, the rate of carbon tax went up from €41.00 to €48.50 per tonne on 1st May, 2023;

— analysis shows that the least well off in society would do worse if the carbon tax was cancelled or frozen, for example, the carbon tax has supported increases in and the expansion of the Fuel Allowance scheme which benefitted more than 400,000 households this winter;

— monies raised also support the National Retrofit Plan, to help families permanently reduce their heating bills, and of the €337 million allocated for retrofitting in Budget 2023, €291 million has being ring-fenced from carbon tax receipts, with over half of this being spent on free retrofits for low-income homes; and

— carbon tax receipts also provide funding to support farmers to farm in a greener and more sustainable way (under agri-environmental schemes), and it is being used to support projects under the Just Transition Mechanism fund specifically, supporting new jobs, new green energy, better public transport and community development and enterprise in the midlands;

recognises that:

— the CRU was established as an independent statutory regulator by the Electricity Regulation Act 1999 and enhanced under the Gas (Interim) (Regulation) Act 2002 and the Water Services (No.2) Act 2013, and is responsible for:

— regulation and reform of the electricity market, including the licensing of new entrant generators and suppliers;

— regulation of the natural gas market;

— security of supply, customer protection, upstream and downstream gas and electrical safety; and

— economic regulation of water services;

— the CRU is legally independent in the performance of its functions and is entirely accountable to the Oireachtas for such performance, and is funded by means of a levy on electricity and gas undertakings and income from licensing fees, and the Department of Environment, Climate and Communications will provide €689,000 in Exchequer funding in 2023 to provide for the regulation of district heating in Ireland;

— with regard to resourcing, approval has been given, in full, for the Commission's three-year workforce plan, representing 74 new whole-time equivalent positions, which include an additional director to meet its objectives under the Strategic Plan 2022-2024;

— the most significant factor affecting retail electricity and gas prices in Ireland is the wholesale price of gas, and while wholesale prices have reduced from their peak in August 2022, due to supplier hedging strategies, it may take a more sustained period of reduced wholesale prices before retail prices reduce;

— the electricity and gas retail markets in Ireland operate within a European Union (EU) regulatory regime wherein electricity and gas markets are commercial, liberalised, and competitive, with prices in the electricity and gas retail markets having been fully deregulated since 2011 and 2014;

— price setting by electricity suppliers, including standing charges is a commercial and operational matter for the companies concerned, with each such company having its own different approach to pricing decisions over time, in accordance with factors such as their overall company strategic direction and developments in their cost base;

— as part of its statutory role the CRU also has consumer protection functions and sets out a number of rules for suppliers to follow in the Electricity and Gas Suppliers Handbooks, and these include special provisions for vulnerable customers around areas such as billing and disconnections; and

— the CRU also oversees the supplier-led voluntary Energy Engage Code under which energy suppliers will not disconnect a customer who is engaging with them, must provide every opportunity to customers to avoid disconnection, must identify customers at risk of disconnection and encourage them to engage and are obliged to offer a range of payment options, such as a debt-repayment plan to those in arrears; and

further recognises that:

— in January the European Commission launched a public consultation on the reform of the EU electricity market design to better protect consumers from excessive price volatility, support their access to secure energy from clean sources, and make the market more resilient, and it will involve making amendments to a number of current EU legislation Regulations and Directives;

— the consultation closed in mid-February and the Commission published a suite of legislative proposals on 14th March, and Ireland is engaging with this programme of work with a view to, among other things, maintaining the integrity of the all-island Single Electricity Market;

— the new TBESS will support eligible companies, covering 40 per cent of the increase in their energy bills;

— the scheme was due to expire on 28th February, however, as the impact of higher energy costs continues to be keenly felt by businesses across the country, the scheme was extended to 30th April, 2023, and the monthly limit on aid under the scheme was increased from €10,000 to €15,000 per qualifying business in relation to a trade or profession, subject to an overall cap of €45,000 in cases where a business is carried on from more than one location, and these enhanced limits will apply for claim periods from 1st March, 2023;

— in April 2022, CRU wrote to Eirgrid and ESB Networks notifying them that it would unwind the Large Energy Users (LEU) rebalancing subvention with effect from 1st October, 2022, and the Network tariffs had been rebalanced since October 2010, in favour of LEUs, following a 2009 Government decision;

— the 2009 Government decision was made to help safeguard jobs in some of Ireland's most-critical and export-orientated industries, at a time when unemployment was rising at a fast rate;

— the impact of the decision to unwind the rebalancing is estimated to reduce an average domestic customer's annual bill by €40; and

— following the introduction of Network Tariffs for the period October 2022 to September 2023, including the unwinding of the LEU rebalancing, and the CRU decision to bring the Public Service Obligation levy to a negative value, domestic customers and small commercial customers are expected to see a small decrease in overall network costs when compared to last year."

-(Minister of State at the Department of the Environment, Climate and Communications, Deputy Ossian Smyth)

An Ceann Comhairle

I must now deal with a deferred division relating to amendment No. 1 in the name of the Minister for the Environment, Climate and Communications to the motion regarding support for household energy bills. On Wednesday, 3 May, on the question, "That the amendment to the motion be agreed to", a division was claimed and in accordance with Standing Order 80(2), that division must be taken now.

Amendment put:

The Dáil divided: Tá, 67; Níl, 58; Staon, 0.

Tá

Browne, James.
Bruton, Richard.
Burke, Colm.
Burke, Peter.
Butler, Mary.
Byrne, Thomas.
Cahill, Jackie.
Calleary, Dara.
Cannon, Ciarán.
Carroll MacNeill, Jennifer.
Chambers, Jack.
Collins, Niall.
Costello, Patrick.
Coveney, Simon.
Cowen, Barry.
Creed, Michael.
Devlin, Cormac.
Dillon, Alan.
Donnelly, Stephen.
Duffy, Francis Noel.
Durkan, Bernard J.
English, Damien.
Farrell, Alan.
Feighan, Frankie.
Flaherty, Joe.
Flanagan, Charles.
Fleming, Sean.
Foley, Norma.
Griffin, Brendan.
Harris, Simon.
Haughey, Seán.
Higgins, Emer.
Humphreys, Heather.
Kehoe, Paul.
Lahart, John.
Lawless, James.
Leddin, Brian.
Madigan, Josepha.
Martin, Catherine.
Matthews, Steven.
McAuliffe, Paul.
McConalogue, Charlie.
McGrath, Michael.
McHugh, Joe.
Moynihan, Aindrias.
Moynihan, Michael.
Murnane O'Connor, Jennifer.
Naughton, Hildegarde.
Noonan, Malcolm.
O'Brien, Darragh.
O'Brien, Joe.
O'Callaghan, Jim.
O'Connor, James.
O'Dea, Willie.
O'Donnell, Kieran.
O'Donovan, Patrick.
O'Dowd, Fergus.
O'Gorman, Roderic.
O'Sullivan, Christopher.
O'Sullivan, Pádraig.
Ó Cathasaigh, Marc.
Ó Cuív, Éamon.
Rabbitte, Anne.
Richmond, Neale.
Ring, Michael.
Smith, Brendan.
Stanton, David.

Níl

Andrews, Chris.
Bacik, Ivana.
Barry, Mick.
Brady, John.
Browne, Martin.
Buckley, Pat.
Cairns, Holly.
Carthy, Matt.
Clarke, Sorca.
Collins, Joan.
Collins, Michael.
Conway-Walsh, Rose.
Cronin, Réada.
Crowe, Seán.
Cullinane, David.
Daly, Pa.
Doherty, Pearse.
Donnelly, Paul.
Ellis, Dessie.
Farrell, Mairéad.
Funchion, Kathleen.
Gannon, Gary.
Gould, Thomas.
Guirke, Johnny.
Healy-Rae, Michael.
Howlin, Brendan.
Kelly, Alan.
Kenny, Gino.
Kenny, Martin.
Kerrane, Claire.
Lowry, Michael.
Mac Lochlainn, Pádraig.
MacSharry, Marc.
McGrath, Mattie.
McNamara, Michael.
Mitchell, Denise.
Murphy, Catherine.
Murphy, Paul.
Nash, Ged.
Nolan, Carol.
O'Callaghan, Cian.
O'Donoghue, Richard.
O'Rourke, Darren.
Ó Broin, Eoin.
Ó Laoghaire, Donnchadh.
Ó Murchú, Ruairí.
Ó Ríordáin, Aodhán.
Ó Snodaigh, Aengus.
Quinlivan, Maurice.
Ryan, Patricia.
Shanahan, Matt.
Sherlock, Sean.
Shortall, Róisín.
Smith, Bríd.
Stanley, Brian.
Tully, Pauline.
Ward, Mark.
Whitmore, Jennifer.

Staon

Tellers: Tá, Deputies Hildegarde Naughton and Cormac Devlin; Níl, Deputies Pádraig Mac Lochlainn and Denise Mitchell.

Amendment declared carried.

Question put: "That the motion, as amended, be agreed to."

The Dáil divided: Tá, 67; Níl, 58; Staon, 0.

Tá

Browne, James.
Bruton, Richard.
Burke, Colm.
Burke, Peter.
Butler, Mary.
Byrne, Thomas.
Cahill, Jackie.
Calleary, Dara.
Cannon, Ciarán.
Carroll MacNeill, Jennifer.
Chambers, Jack.
Collins, Niall.
Costello, Patrick.
Coveney, Simon.
Cowen, Barry.
Creed, Michael.
Devlin, Cormac.
Dillon, Alan.
Donnelly, Stephen.
Duffy, Francis Noel.
Durkan, Bernard J.
English, Damien.
Farrell, Alan.
Feighan, Frankie.
Flaherty, Joe.
Flanagan, Charles.
Fleming, Sean.
Foley, Norma.
Griffin, Brendan.
Harris, Simon.
Haughey, Seán.
Higgins, Emer.
Humphreys, Heather.
Kehoe, Paul.
Lahart, John.
Lawless, James.
Leddin, Brian.
Madigan, Josepha.
Martin, Catherine.
Matthews, Steven.
McAuliffe, Paul.
McConalogue, Charlie.
McGrath, Michael.
McHugh, Joe.
Moynihan, Aindrias.
Moynihan, Michael.
Murnane O'Connor, Jennifer.
Naughton, Hildegarde.
Noonan, Malcolm.
O'Brien, Darragh.
O'Brien, Joe.
O'Callaghan, Jim.
O'Connor, James.
O'Dea, Willie.
O'Donnell, Kieran.
O'Donovan, Patrick.
O'Dowd, Fergus.
O'Gorman, Roderic.
O'Sullivan, Christopher.
O'Sullivan, Pádraig.
Ó Cathasaigh, Marc.
Ó Cuív, Éamon.
Rabbitte, Anne.
Richmond, Neale.
Ring, Michael.
Smith, Brendan.
Stanton, David.

Níl

Andrews, Chris.
Bacik, Ivana.
Barry, Mick.
Brady, John.
Browne, Martin.
Buckley, Pat.
Cairns, Holly.
Canney, Seán.
Carthy, Matt.
Clarke, Sorca.
Collins, Joan.
Collins, Michael.
Conway-Walsh, Rose.
Cronin, Réada.
Crowe, Seán.
Cullinane, David.
Daly, Pa.
Doherty, Pearse.
Donnelly, Paul.
Ellis, Dessie.
Farrell, Mairéad.
Funchion, Kathleen.
Gannon, Gary.
Gould, Thomas.
Guirke, Johnny.
Healy-Rae, Michael.
Howlin, Brendan.
Kelly, Alan.
Kenny, Gino.
Kenny, Martin.
Kerrane, Claire.
Lowry, Michael.
Mac Lochlainn, Pádraig.
MacSharry, Marc.
McGrath, Mattie.
McNamara, Michael.
Mitchell, Denise.
Murphy, Catherine.
Murphy, Paul.
Nash, Ged.
Nolan, Carol.
O'Callaghan, Cian.
O'Donoghue, Richard.
O'Rourke, Darren.
Ó Broin, Eoin.
Ó Laoghaire, Donnchadh.
Ó Murchú, Ruairí.
Ó Ríordáin, Aodhán.
Ó Snodaigh, Aengus.
Quinlivan, Maurice.
Ryan, Patricia.
Shanahan, Matt.
Sherlock, Sean.
Smith, Bríd.
Stanley, Brian.
Tully, Pauline.
Ward, Mark.
Whitmore, Jennifer.

Staon

Tellers: Tá, Deputies Hildegarde Naughton and Cormac Devlin; Níl, Deputies Pádraig Mac Lochlainn and Denise Mitchell.

Question declared carried.

Dáil Éireann debate - Wednesday, 10 May 2023