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Seanad Éireann debate -
Tuesday, 15 Feb 2022

Vol. 282 No. 12

Electricity Costs (Domestic Electricity Accounts) Emergency Measures Bill 2022: Second Stage

Question proposed: "That the Bill be now read a Second Time."

I am very glad to be here to introduce this Bill. It is an important part of the Government's response to the recent increase in the cost of living due to high electricity and gas prices. It is in this regard that we produced the Bill. I am glad to be opening the debate today and to be able to set the context for the action to be taken on foot of this Bill. I will describe the sections of the Bill and, having regard to its main provisions, set out some background as to why they are needed for the operation of the scheme. My overarching message is that while the scheme this Bill will establish is just one of a package of measures, it is critical to put it into place within this quarter. I seek permission to achieve that. First, I will outline the main factors affecting electricity prices in Ireland. Second, I will outline the Government's response to rising electricity and gas prices. Third, I will reaffirm the Government's conviction that the best long-term approach to insulating consumers from volatility in international fossil fuel markets is to decarbonise our energy system and radically improve the energy efficiency of our housing stock.

I will now turn to the first point, namely factors affecting Irish electricity prices. Senators will appreciate that we face additional costs due to our geographical location, fossil fuel dependency, the small scale of the Irish market, our low population density and exchange rate fluctuations. However, the most immediate factor affecting electricity prices in Ireland has been the unprecedented upward trend in international gas prices since 2020. Indications are now that these higher prices will remain significantly higher for the immediate future. This feeds directly through to retail electricity prices because gas is used for electricity generation. It is a matter of serious concern to the Government that energy price increases caused by these international conditions are putting increasing pressure on consumers, particularly the most vulnerable. These price increases are not caused by the Government or regulatory decisions. Suppliers compete with one another on price and set their own prices, as expected in a competitive commercial liberalised market. The Commission for Regulation of Utilities, CRU, indicated that customers could save €300 by switching their electricity or gas supplier every year.

It is important to state that all European markets are experiencing these same price increase. Other member states have taken various actions, including suspending tariffs for networks, suspending tariffs for green energy subsidies, reducing VAT and introducing or increasing payments to low-income households.

Since Ireland's announcement of a credit to each domestic electricity household, Belgium has followed suit announcing that it will introduce €100 credit for households.

I will now turn to the Government's response to the rise in prices. On 10 February, a suite of Government policy measures was announced by the Minister for Finance and the Minister for Public Expenditure and Reform designed to further support households. These new measures included an increase in the energy credit in this Bill to €200, including VAT. This will necessitate a change to the text of the Bill that specifies both the upward limit on funding for the scheme it establishes and the amount of the individual payment to be made to each domestic electricity account. I will bring forward the necessary amendments on Committee Stage in this House.

A temporary 20% reduction in public transport fares will apply from April until the end of the year. A further lump sum payment of €125 on the fuel allowance will be paid in early March to some 390,000 recipients. In addition, there are reduced caps for multiple children on school transport fees to €500 per family post primary and €150 for primary school children. There will be a reduction in the drug payment scheme from €144 to €80, which will benefit approximately 70,000 residents. The working family payment budget increase announced on budget day will be brought forward from 1 June to 1 April.

All of these measures are on top of the existing measures taken in budget 2022 to support households. Budget 2022 increased the weekly rate of the fuel allowance by €5 to €33 a week so that €924 will be paid to eligible households over the course of this winter. The fuel allowance is one of a range of income supports paid by the Department of Social Protection, which also includes general social welfare schemes, living alone increases to support those living alone and at a higher risk of poverty, and the household benefits package. Targeted supports are also provided under the supplementary welfare allowance scheme, exceptional needs payments and urgent needs payments while under the supplementary welfare allowance scheme, a special heating supplement may be paid to assist people with special heating needs, for example, in the case of ill health.

Looking to the future and the urgent need to decarbonise, I will now outline the long-term approach for Ireland and in that context, the Government's urgent focus on energy efficiency. Energy efficiency is central to addressing the root causes of energy poverty and improving health and social inclusion outcomes while at the same time, contributing to decarbonisation. On 8 February, the Government announced unprecedented grant supports for home energy upgrades and increased numbers of free energy upgrades for those at risk of energy poverty. A new national home energy upgrade scheme providing increased grant levels of up to 50% of the cost of a typical B2 home energy upgrade with a heat pump - up from 30% to 35% currently - with a one-stop-shop providing an end-to-end service for homeowners. We are also introducing higher grants for cavity wall and attic insulation, which will more than triple to cover approximately 80% of the typical cost of these measures and will be available to all homeowners. For instance, in the case of a semi-detached home, the attic insulation grant will increase from €400 to €1,300. It is expected that these works will pay back in one to two years in most houses.

A total of €267 million has been allocated for SEA's residential and community retrofit schemes in 2022. This investment will support almost 27,000 home energy upgrades, including upgrading over 8,600 homes to a BER of B2, which is a near doubling of B2 output over 2021, and 4,800 free energy upgrades for households at risk of energy poverty. In addition, €85 million in funding has been provided by the Minister for Housing, Local Government and Heritage for the local authority energy efficiency retrofit programme. Making our homes energy efficient not only means they are warmer, healthier and cheaper to run but also means we are taking concrete action on social deprivation, including energy poverty, that is sustainable and enduring.

I will now devote my remaining remarks to the Bill's subject matter. The Bill will establish a scheme through which the electricity cost emergency benefit can be paid in 2022. The Commission for Regulation of Utilities, CRU, as an independent energy regulator, will provide oversight of the scheme, which will be operated by the electricity distribution system operator ESB Networks. I will provide, under regulations, for a date on which the distribution system operator will calculate the total number of domestic electricity accounts in the State on the basis of meter point registration numbers, MPRNs.

ESB Networks will notify me of the number of MPRNs and that will allow for the calculation of the allocation of moneys for the scheme. On the effective date, which will also be set out by me in regulations, ESB Networks will notify electricity suppliers of the assigned MPRN for each domestic electricity account supplied and of the amount of money that will transfer to them for the purposes of the scheme. I will set out in regulations the period within which ESB Networks will transfer the funds to suppliers for the sole purpose of making the payments. Following receipt of these funds, suppliers will then, within the period to be prescribed by me under regulations, credit each domestic electricity account held with them on the effective date with the payment.

I will now provide a section-by-section summary of the Bill. Section 1 provides for definitions. Section 2 provides for the establishment of the scheme, to be operated on a once-off basis. It provides the basis for the estimation of the amount required and for the upper limit on total funding to be allocated by me, with the consent of the Minister for Public Expenditure and Reform.

Section 3 provides for the transfer of the moneys to each domestic electricity account in the State for the operation of the scheme by me with the consent of the Minister for Public Expenditure and Reform, to the distribution system operator, DSO. Sections 4 and 5 provide for the functions of the DSO and suppliers, respectively, for the purposes of the operation of the scheme.

Section 6 provides for the amendment of section 9 of the Electricity Regulation Act 1999 to create functions for the CRU, including oversight of the functions of the distribution system operator and suppliers, to ensure that the administrative and operational arrangements necessary for the scheme are in place.

Section 7 deals with an amendment to the Taxes Consolidation Act 1997. This amendment is to exempt the electricity costs emergency benefit payment from income tax. Section 8 provides for me to make regulations, with the consent of the Minister for Public Expenditure and Reform, to set out the dates and periods for the operation of the scheme, as well as to provide for additional functions of the distribution system operator, electricity suppliers and such administrative and operational matters as may be required.

Section 9 provides that the DSO and electricity suppliers shall bear their own expenses. Section 10 contains the Short Title and commencement of the Act.

I have outlined the main provisions of this Bill and provided additional detail on the sections. I hope this will assist Senators and I look forward to a meaningful debate with Members from all sides of the House.

I welcome the Minister to the House and I thank him for setting out the ten sections in this Bill and the rationale behind the legislation. I recognise this comes as a Government response to the rising costs of energy. Unfortunately, some would say it is not enough, while others would say it is not specifically targeted. Indeed, I find myself wondering why I am getting a payment when I am well paid, have a good job and do not need it. I do not wish to be flippant about this, but I do want to be honest. Frankly, I do not know why any Oireachtas Member should benefit from a €200 package. It is not targeted and it is not the right thing. That is a criticism of the system, and not of the Minister.

I understand that the Government wishes to roll this out fast and that it must be simple and simple to administer. Given our incomes, however, I have a serious issue, frankly, with the elected Members of the Houses of the Oireachtas benefiting from €200. That is one of my concerns about this measure. I do not have the option to pass it on, other than writing a cheque and passing that on to a charity or to someone who needs it. I must say that, because I am uncomfortable that I, as an representative in the Oireachtas, am getting some sort of subsidy when, quite frankly, I do not need it. I suggest many other people do not need it either, but that is not for me to say because people have different circumstances. That is my concern.

I thank the Minister for setting out the context of this legislation and its provisions. I acknowledge that the package of measures is clearly an attempt to sort out the issue of rising costs. The Government has said that it is committed to protecting the most vulnerable. I know where it is coming from in that regard. Too many of the people in the squeezed middle, however, are telling me they have difficulties paying their rent or mortgage; it is a question of affording food or heat or the rent or mortgage. These are tough times, and the Minister accepts and understands this.

The Bill establishes a scheme to make the electricity cost emergency benefit payment of €200 in 2022. I also understand, and this point has been raised with me by people who are tenants, that there are approximately 300,000 tenancies registered with the Residential Tenancies Board, RTB. The Minister will be familiar with the work of that organisation. Most of these tenants either hold their own electricity accounts or pay their landlords for the cost of their electricity based on a bill. There are questions concerning who can receive this electricity cost emergency benefit payment. It is clearly intended for the consumers of electricity in a residence and not the landlord. This initiative, though, must be administered and I do not know if thought has been given to this aspect. I ask the Minister to elaborate on this aspect of the scheme.

I have several concerns regarding this Bill and I will flag them now. We are talking about the need and importance of insulating customers from further electricity price rises. It will be a long-term process, while this is a short-term measure. In his contribution, the Minister stated, "The fuel allowance is one of a range of income supports paid by the Department of Social Protection, which also includes general social welfare schemes". Not everyone receives those payments. There are people on low incomes not receiving some of these payments.

The Minister for Housing, Local Government and Heritage, Deputy Darragh O'Brien, indicated that there are plans to invest €85 million as part of the local authorities' retrofitting programme for 2022. I welcome that as a positive initiative. These things take a long time to come through. I am not sure if the Minister is that familiar with the detail of the scheme, but he might share what information he may have with us. These are positive things that are happening and I welcome them. In theory, this funding would allow for the retrofitting of more than 2,000 local authority homes and increase their energy ratings, and that is a plus. Ideally, we should have a rolling programme to set this initiative in motion.

The Minister understands, as I do, that alleviating energy poverty must be a key consideration in any successful national retrofitting plan. This is the problem. The programme must be cost effective, but the current loan structure is unaffordable for many people. This is the reality of the situation. I asked a woman recently whether she would apply for this scheme and her reply was that she would get a lot of electricity for €27,000. I suppose she had a point. The cost of retrofitting is prohibitive for many people on limited incomes.

I understand what the Minister is doing and I am supportive of what is being done. It is a short-term undertaking. There is a bigger strategic plan for the long term and we must go in that direction. We have people who are cold in their homes, as I said, and who simply cannot afford to pay their bills. Many of those people are working and on low incomes. We must acknowledge that important point. I spoke to a woman from County Galway and she told me she was thinking about removing her landline telephone connection because she can no longer afford it. A landline is critical in rural Ireland, especially if there is a power cut and it is not possible to charge a mobile phone. Taking out her landline will result in that woman becoming more isolated. That is just an example of one personal experience. I also received a letter recently, as many of us did, from the Irish Senior Citizens Parliament, a voice of older people. The letter crystallises what I am trying to say to the Minister. It refers to retrofitting being worthwhile and beneficial, but also states that the scheme excludes many older people who do have the savings base to secure a loan to do the work. This point was made by an important and active organisation representing Irish senior citizens.

I am not going to dwell on this. I am of course going to support this legislation. I understand where the Government is coming from and what it is attempting to do, but we have a real energy cost crisis. I would particularly like to hear about the Government's plans for retrofitting our social housing stock. It is one area where we know people are suffering disadvantage. Many of them are on low incomes, and that is why many of those people are in social housing. It is a target area we could focus on. If we are going to support people, let us target those supports to the really vulnerable people in need.

I am thankful for the opportunity to contribute after Senator Boyhan. The Minister is very welcome. We all receive letters and go to people's doors, and we know we are in crisis.

We are in the midst of two crises, a climate crisis and a cost-of-living crisis. As has been said, this legislation is one small part of a set of measures. This Bill came before the Oireachtas Joint Committee on Climate Action and many of us are members of that committee. We all agreed to waive pre-legislatiive scrutiny of the Bill. That was when the benefit payment proposed was €100 less then what is proposed in Bill. That showed we all understood the crisis, the emergency and that time was against us. While I take on board the issues with the fact that the payment is not targeted, we also know that we must act fast. The provisions are not in place to target this payment but many other measures are also being introduced. It is important to reach everyone because everyone is impacted. What people choose to do with this money is up to themselves but some people will rely on it heavily and need it urgently. Other measures the Minister outlined include a 20% reduction in public transport fees, a fuel allowance lump sum payment of €125, a reduction in the caps on school transport fees, a reduction in the drugs payment scheme monthly threshold from €144 to €80, which will impact on many people I know, and the front-loading of the working family payment.

I hope Senator McGahon will speak about a flexible public transport ticket, which he has raised previously. We need to address the issue of public transport. I acknowledge the Minister is not present in his role as Minister for Transport but it is an important issue. Important considerations are what plans the National Transport Authority has and how quickly it can implement those plans to ensure their roll-out. Some 70% of 15-minute journeys are made by car. We must address the fact that a modal shift is not taking place.

A total of 14 councillors on Galway City Council voted against a proposed temporary cycle lane last night, bearing in mind that with respect to 15-minute journeys, only 1.6% of people cycle them. We need to urgently address these matters. Part of that is to ensure we have the necessary public transport and that it is available. We are coming to that point now with Connecting Ireland and so on. Part of that is also a responsibility on local authorities and local councillors and that means every party playing its part. Only two political parties voted in favour last night, not of retaining the temporary cycle lane in Salthill as it had not been put in place but of keeping to what had been their previous message, namely, that they were in favour of the putting in place of a temporary cycle lane. Everybody must play his or her part and not only the Minister but the local authorities. Under the Climate Action and Low Carbon Development (Amendment) Act 2021, relevant bodies also have obligations. That must include local authorities but they are not stepping up to the mark. Time and again we have put forward funding to introduce such measures, which are low-hanging fruit when it comes to climate action, and councillors have voted against them and executives have not put them forward. We have a climate crisis but also a crisis when it comes to local authorities and local democracy. Every day people contact me who desperately want action to be taken to ensure their children do not have to get into a car to go to school. I live five minutes from the promenade in Salthill and I certainly would not cycle with my children along that road. I would cycle it but one has to dodge in and out as car doors are opened and closed all along the promenade. It is simply not safe for even the hardiest of cyclists. Therefore, there is an obligation on everyone, not only on the Minister.

I would like to address the fact that some parties are against a carbon tax. Sinn Féin is one of the very few parties, internationally, against a carbon tax; that is a fact.

A minority of countries enforce it.

It is important to point out that many of these measures, including this one and the retrofitting measures, are all paid for from carbon tax revenue. When I hear the narrative about the hike in the fuel prices, it is often blamed on carbon tax, but we must be honest with people. That is not the case. A very small percentage of that is carbon tax. It is required to ensure we use a carrot to ensure we shift people into thinking a different way. For instance, only 2.5 cent of the 35 cent increase on a litre of motor fuel is accounted for by the carbon tax. The most responsible thing to do is to be honest about it to ensure we continue to address the climate crisis but also address, in a substantial way, and this Bill is a part of that, the cost-of-living crisis. Those two elements can go hand in hand, which is what we have seen with the national retrofitting plan and the increase in the fuel allowance. Is it not enough? It is not because there is an international crisis. We are reliant on a fossil fuel industry and on prices from other countries. Therefore, we must increasingly invest in retrofitting and renewable energy. Currently, wind energy accounts for 40% of our renewable energy and we need to reach the target 80% in eight years. That will take investment but also people in local authorities, the national Government and national parties supporting us all in order that we can all move forward together.

Many of us were at the lunch with Mary Robinson earlier and her big message was that the Seanad should be used to substantially address the issue of climate and to make it real for people. These are measures that make it real for people. Let us not play politics with it. Let us all get on board with being honest about what carbon tax means and what measures are in this Bill, that they are a small part of what is required but that we are trying to do something positive.

I welcome the Minister. Like many others, I welcome the Government intervention in assisting people with the significant cost-of-living increase, particularly concentrated in the energy sector. The €200 benefit payment and €125 lump sum payment on the fuel allowance will not solve all the losses people for sure, particularly those on low pay and in receipt of social welfare, will have suffered as a result of this. I need to speak out against the people who say it will make no difference. For those people I deal with who are living on the edge, €325 will mean an awful lot to them. Those who would cast it aside and say it means nothing are people who are reasonably wealthy and are making a judgment. The fact of the matter is that this intervention is significant and it will help. It does not go all the way and, like Senator Boyhan and others, I would have liked a more targeted approach taken. I would like to have seen a greater quantum of money given to people on lower incomes but I recognise that if we are to act quickly and try to address the problem, developing a means-tested targeted approach would disenfranchise people in the short to medium term and it would take too long. It is always the case that wherever a threshold is set, there is a hardship case on the other side of that. This is an appropriate response. In an ideal world we would be able to do it differently. Sadly, we do not live in an ideal world.

In parallel, we need to increase our ambition for the retrofitting programme and the development of renewable energy sources, and the Minister is addressing that. That is the future. That is the best way we will address price certainty and energy security into the future. We see what is paying out on the Russian-Ukraine border. Obviously, that is creating international uncertainty. It is allowing for gain for those who buy and sell the litre of oil a multiplicity of times before it ever gets to be utilised here at the end of a very long journey. We have access to that area.

The Minister and I have had numerous conversations about our ambition regarding floating offshore wind turbines and a corresponding hydrogen strategy. I just hope that the Government, over the coming years, will be able to advance these ahead of the ESB's ambition, which involves a timeline of eight to ten years. We have got to realise our ambitions much more quickly.

At best, we hope that the very significant increase in oil and gas prices will be somewhat temporary. Depending on who you listen to or read, the instability could be for the next 12 to 18 months, but it could be for longer. The Government will have to intervene if it goes, or is likely to go, beyond that. With the cost of diesel having risen by 35 cent to 40 cent in a relatively short period, people will just not be able to manage economically or take on the intolerable burden.

People have bought into the carbon tax. I agree with my colleague in this regard. The vast majority of people I know recognise there had to be a signal to the marketplace, investors and the fuel sector that fossil fuels would cost more in the future. We agreed on this at the committee meeting, with the exception of one party and a number of Independents, whom I accept disagreed for their own reasons. The reality, however, is that we had shown the trajectory and people had bought into it. It pales into insignificance, however, when you consider the uncertainty the market has foisted on us.

We have to move towards more active travel. We are getting there through our investment, but if the massive spike in the cost of diesel and petrol is to continue beyond a year or year and a half, the Government will have to do something to moderate it. There are rebate systems. There would be a very significant impact on the agricultural community, which we are trying to bring with us on this green journey. From discussions the Minister had with some farmers in Clare last Friday, he will know they are up for that. Not all of them are, but the majority are. Increases will have an impact on the cost of goods and an effect on the supply chain. Therefore, while I understand where the Government is at the minute, I am firmly of the view that if a price spike becomes a plateau, there will have to be a significant intervention. I hope that can take place.

The electricity costs emergency benefit scheme we are talking about forms part of a package of budget interventions put forward in October 2021 by the European Union, including the Commission's toolbox of interventions that allow member states to go about tackling rising energy costs. I ask everyone to read the supporting documentation today. It is really interesting. The tools will serve as an important part of our arsenal, not just in the next 18 months but also over the next eight years as we move towards our target of having 70% of our energy generated from renewables.

Some of the price hikes that are due to be implemented in April are quite worrying. I can see why they are so worrying for consumers but that is why it is so important to expand on the emergency measures the Government is taking to allay their concerns. SSE Airtricity's electricity price is to rise by 6.2% and its gas price is to rise by 4.5%, effective from 1 April. Energia announced an electricity price increase of 8.6% and a 5.7% in gas prices, effective from 5 April. Panda Energy announced an electricity price increase of 7.5%, effective on 8 April. Flogas announced an electricity price increase of 8.5% and a gas price increase of 6.5%, effective on 12 April. We are not facing these increases only in Ireland but also right across the European Union. The reason is the increase in global demand as we exit the pandemic. However, it is important to remember that, as Senators have said, markets are expected to stabilise at some stage, possibly early this year.

While the instability exists, it is important to be able to introduce emergency measures such as the one under discussion. As Senator O'Reilly said, we decided not to go ahead with pre-legislative scrutiny to allow us to introduce it across the board very quickly. That is what is really important about it. There could be further instability between now and 2023. It will then be really important for the Government to rely on the European toolbox of measures. It could be really useful. There are many decent suggestions in it. We are going with the main suggestion, which involves member states making payments to those most at risk in paying their energy bills. This is being financed through the EU emissions trading system. Along with implementing such measures, it is important that we consider introducing safeguards to make sure energy companies cannot disconnect people's energy supply. This would be useful if people were to fall into arrears and things got worse.

There are many other measures we could introduce. The measure being introduced is just one of a suite of measures. If things get worse, we can introduce an energy taxation directive whereby we can temporarily exempt vulnerable households from tax, or apply a reduced tax rate, directly in respect of electricity, natural gas, coal and solid fuel. We could also do a lot to empower and protect consumers here in Ireland. We could provide people right across the country with quality information and options regarding how they can participate in the energy market. Making the switching of suppliers faster and easier is one way we can go about this. We can further boost the role of consumers in the market. We plan to do this by giving people the ability to generate their own electricity. They will be able to use it themselves or sell it back to the grid. I am trying to talk about a range of measures we can implement as a Government if we come across further price instability in electricity markets.

On the point on selling energy back to the grid, creating our own energy and having energy communities, I want to make a small diversion into the topic of solar energy. Both solar and wind energy will play such an important role in hitting our targets by 2030 and reducing our reliance on fossil fuels. By reducing our reliance on fossil fuels, we will decrease the possibility of price instability. I raised with the Minister at a committee meeting a couple of months ago the impact of capital acquisitions tax on the agricultural community and renewable energy sector. The current rules for the tax state those who inherit agricultural land can get a relief of 90% on the market value of the asset, but this is contingent on the total amount of land being utilised for solar panels constituting less than 50% of the total landholding. This threshold of 50% needs to be removed because the point is that we will not be able to incentivise people in the agricultural community to move into full-blown solar farming if their capital acquisitions tax is to be impacted if they wish to inherit a farm. We want people to be able to fill a large field fully with solar panels, not 49.5% or something like that. We should remove a barrier that exists in the agricultural community. The Minister for Finance, Deputy Donohoe, will have to examine this. I spoke to him about it before. I would appreciate it if the Minister for the Environment, Climate and Communications and I could meet briefly to discuss it. He could pass on my concerns to the Minister for Finance. Addressing the capital acquisitions tax issue would be a simple way to remove a barrier that exists, making sure people who want to get into solar energy can do so as easily as possible.

Former President Mary Robinson mentioned earlier that people can be scared by the science and nuance of the climate action debate. I found this myself when I first got involved as a climate action spokesperson 18 months ago. Trying to get involved in the climate action debate can be intimidating when you are up against people like the Minister, Deputy Eamon Ryan, and others who have been involved in it for decades. What we need to do is make it as simple as possible for the average Irish person to engage in the debate. We can do so by making measures financially viable for people. We are doing this through the retrofit programme, the introduction of so many electric-vehicle charging points and making so many grants available. We are making it financially simple for people who want to live a green and sustainable lifestyle. We are making it financially possible but also as hassle-free and easy as possible. An example of where we are doing this relates to the concept of the one-stop shops for the retrofit programme, whereby someone will project-manage the whole thing.

I went off on a slight tangent but my point relates to solar energy. If we want people in the agricultural community to engage in solar farming on a wide scale, we really need to remove the 50% barrier. I am interested in hearing the Minister's thoughts on that.

While we move towards renewable energy, we should note that it promises much lower prices in the long term. Over the short to medium term, consumers may have to deal with the price instability we are seeing, but the whole point of the legislation we are introducing today and the suite of measures the European Union has said we could introduce, including the toolkit, is to address this instability.

While we are making the transition to a renewable energy economy and working hard over the next eight years to get to the 70% target for wind and solar energy, we must be able to introduce emergency measures or at least have fallback plans or measures that can be introduced, as we are doing now, to protect the Irish consumer against instability in energy prices. This is a good example of one way of doing that, but it is just one of many other tools in the armoury that will be open not only to this Government but to all member states in the European Union.

Cuirim fáilte roimh an Aire. Before giving my substantive contribution, I must address some of the commentary here today. I accept that people have differences of opinion on how to tackle climate change but I will not accept people dismissing the fact that others have done their research on this. I have worked in the area of environmental issues and climate change for years and my research on the carbon tax, which is backed up by a meta-analysis carried out in 2021 and empirical ex post evidence from January and February 2021, shows that the reductions in carbon are minimal, at between 0% and 2% per year, and that it is highly damaging to the public buy-in to the transition. I also wish to point out that in 2018 it was exposed by an eminent academic, who has exposed all the work ExxonMobil has done in damaging the arguments about climate change and undermining climate change evidence, that ExxonMobil pledged $1 million to support a carbon tax advocacy group and the head of that group was a former PR executive adviser for ExxonMobil. We can disagree on this, but I will not have people saying that this is something that has just been jumped on as a populist measure. This is a position that has been researched and which I will stand over.

We are talking today about energy poverty and people facing hardship. It is worth pointing out that over a year ago, not long after I was elected, I was raising this issue with the Minister. I conducted a study on energy poverty. The responses received then were harrowing, even before all the hikes in energy prices. People were huddling in one room and choosing between heating their homes or putting food on the table. The dogs in the street knew back then that they were struggling. However, whenever I ask Ministers about the level of energy poverty they are unable to give me an answer because we do not have a clear definition of what constitutes energy poverty. It was clear from budget 2022 that the Government did not have a handle on the scale of the problem because it did not go far enough in that budget to protect people. Then there was this announcement last week to make up for that, with the Government referring to if it had known then what it knows now. The truth is, however, that many of us were highlighting this a year ago and saying there were massive issues with energy poverty.

In our alternative budget, Sinn Féin proposed enhanced payments in social welfare and fuel allowance. Deputy Kerrane put forward the idea of a discretionary fund. The Tánaiste said he would consider it, but the Government failed to heed any of that. If we do not know what the definition of energy poverty is and if we do not measure it, we cannot address it. I have spoken numerous times, like a broken record, about the energy poverty strategy. That strategy lapsed in 2019 and there is no new energy poverty strategy. We were promised a review of the implementation of the previous strategy last year, but last week, in a response to a Commencement matter, the Minister of State at the Department of Public Expenditure and Reform, Deputy Ossian Smyth, promised that we will have it in the first quarter of next year. We have also been promised Central Statistics Office, CSO, metric indicators around making sure that the retrofitting programme can be held up for its social impact assessment. We are also told that the Economic and Social Research Institute, ESRI, is working on the metrics but, again, there is no timeframe for that.

It is unfortunate that Senator Pauline O'Reilly was not at the meeting today of the Joint Committee on Environment and Climate Action when the energy regulator, the Commission for Regulation of Utilities, CRU, was there for three hours to answer questions from those of us who are concerned about what the regulator is doing to help people with their energy costs. It was deeply concerning to hear the regulator take a very hands-off approach to what it can do. It refuses to intervene directly in the market and to regulate when 70% of what is in a customer's bill are costs that are directly regulated by the CRU. I was dumbfounded to hear the regulator say that the markets will fix this and that it is just an international problem of costs when we know that the wholesale costs across the EU are lower than they are here.

The regulator refused a cap on affordable tariffs, as happens in Britain. The pay-as-you-go tariff will not be capped and the default tariff will not be capped. The regulator ruled it out, saying it did not have the evidence to show that it would work. The regulator refused to curtail network and wholesale costs. Some 38.1% of customers' bills will go on network costs and the regulator did not question that. It was the same with its challenge of EirGrid and the ESB. The regulator has spent 25% of its budget on private consultants, yet it has never challenged the ESB. It does not have the resources to challenge the likes of the ESB and ask if all the costs are necessary. The CRU was asked about public service obligation, PSO, reform. Up the road in the North the PSO is designed in a way whereby households pay less PSO to businesses. The regulator ruled that out as an option as well.

We are here to discuss the €100 rebate measure, which forms part of the EU toolbox to address the energy price crisis. People say it is not targeted and that it is too little, too late. I have concerns. We looked at what is suggested in the EU toolbox. It says that social payments should be targeted. The EU also suggested using the revenue from the EU emissions trading scheme to fund it. Again, however, Ireland does not do that properly. According to the European Court of Auditors and the Comptroller and Auditor General, the Government does not ring-fence the funds from the emissions trading scheme for climate measures. We talk about the carbon tax but how about ring-fencing the money from the emissions trading scheme that is coming in every year for climate measures, as every other EU country does? That would make energy-intensive companies pay for the transition instead of households.

I made a freedom of information, FOI, request regarding the €100 rebate and it appears that funds to fund this €100 or €200 rebate are coming from energy poverty alleviation programmes, retrofitting and rural broadband. The Department of Public Expenditure and Reform said in the FOI that it was concerned that helping people in this way would set a precedent and that the Minister should avoid going into details about where the funding was coming from because it was underspend from the Department of the Environment, Climate and Communications. The EU also suggested applying a reduced rate of tax on a temporary basis. Again, the FOI showed that this was not considered. It was ruled out of the question. The EU suggested taking measures to help all energy consumers and to direct support for a defined minimum consumption per household or inhabitant. While the Government's plan supports all energy consumers, it is blind to the minimum consumption necessary. Everyone gets €100 regardless of whether one lives in a G-rated rental or an A1-rated new build. The EU suggests stepping up investments in renewable energy, renovations and energy efficiency, but the Government decided to do the opposite and take the money from that fund to fund the €100 measure.

I am running out of time so I will not get to all the issues I wished to raise. People at home might have been hoping that the energy regulator would do its job and regulate the energy companies when they are making profits. I believe the profit for the ESB last year was €74 million. If we were banking on the energy regulator to stand up for ordinary people and households, it certainly made it clear today that this would not be the case.

I thank the Minister for coming to the House. He spoke about his commitment to protecting the most vulnerable. We all share the view that it is vital that something is done to address the cost-of-living crisis in this country, but how to fix it is another question. Vulnerability comes in a number of forms. There is vulnerability with regard to housing security and rising rents and vulnerability with regard to the prospect of some working parents thinking about leaving a job because there is no affordable childcare available. The real regret and disappointment for me last week was that nothing was done with regard to what I consider to be the permanent cost-of-living crisis in this country. There was no rent freeze and nothing for families who are reliant on or seeking affordable childcare. Some childcare providers are saying that they will be forced to increase their rates over the coming months because of the tapering off of the employment wage subsidy scheme, EWSS.

There was nothing for people who have to drive and do not have the alternative of access to public transport. We want to shift people away from cars and into public transport, but the Minister knows as well as I do that the reality in large parts of this country is that there are no bus or rail networks. Nothing was done to help them in view of the 32% increase in the price of diesel and petrol.

For those who are vulnerable and at risk of fuel poverty, there was also a huge disappointment. There was an abject failure to amend and improve the fuel allowance scheme, which was put in place to deal with those who experience fuel poverty. Other than the €125 that they will get, nothing was done with regard to eligibility for the fuel allowance. That 20,000 applications for fuel allowance were rejected last year, along with a further 3,000 in the first five weeks of this year, tells us something about the desperation that many households are in with regard to their rising energy costs. There was a missed opportunity in the context of amending the eligibility and entitlement rules. As the Minister knows, if everyone in a household does not qualify, nobody qualifies for the fuel allowance and that has to be changed from here on out.

We are here today to debate the Electricity Costs (Domestic Electricity Accounts) Emergency Measures Bill 2022, which provides for a universal untargeted payment of €200 to all electricity account holders. There are a number of key concerns with regard to the Bill. First, the payment will be to electricity account holders. There is a significant difference between the definition of an account holder and a household, particularly when it comes to utility payments. For the less than 70% of households that are in owner-occupier houses that have a mortgage, it is relatively straightforward in that we know the €200 will go directly to them. However, for the more than 30% that are in rented accommodation, there are a whole raft of issues, some of which Senator Boyhan raised earlier. For those who are renting accommodation where utility costs are part of the rent, we need to be clear on how we ensure the benefit of the €200 payment goes to that household in part or in full and is not retained by the landlord. We in the Labour Party will table amendments on that precise issue. For those in shared accommodation, we need to be clear on how the payment will benefit everybody in the household and not just the person whose name the bill is in. There is a glaring need to ensure those in rented accommodation get the full benefit. Due to the way the Bill has been set out, there is a real risk that large pockets of people will fall through the net. There are other issues with pay-as-you-go or prepay customers, which we know amount to 12% of all households in this country. It is an increasing number and that reflects the hardship households are facing with regard to utility bills. However, we have no detail on how they will benefit from this payment.

Overall, there is a serious question about the conversation the Government has had or will have with the energy suppliers in this country. As Senator Boylan more eloquently expressed than I ever could, there has been a failure by the Commission for Regulation of Utilities to engage seriously with the issue of how energy suppliers can also contribute to supporting households. Senator Boylan talked about how the profits of ESB Networks increased by €74 million last year. Energia's post-tax profit surged by 50% last year to almost €29 million. Bord Gáis Energy again saw an increase in its profitability last year. The question has to be asked: what are we asking of them? Tariffs are tightly regulated in this country, but there must be scope within that system to ensure additional supports are provided during this fuel crisis. The burden of responsibility must be shared between the Government and those energy suppliers. There is an opportunity cost of using that €215 million to support all households instead of supporting the worst-off households.

The Minister has said that energy efficiency is key in addressing the root causes of energy poverty, and I do not doubt his passion and sincerity in that regard. We have heard him say that many times. Last week's retrofitting announcements were very important and a significant step. However, at the heart of what was announced last week there was a very basic inequality. Households that can afford a deep retrofit, afford to stump up the 50% and afford to borrow or have the savings for the €25,000 plus can reap greater benefits than a household that can only insulate its attic or do more minor works. This is a serious problem. The Minister knows, as do the Senators in the Chamber, that the gap in the energy bill for a house that has a rating of G or F relative to a house that has a B2 rating is in the region of €3,500 per year, and I am sure that figure is growing. We need to better support those households that do not have the savings or can never afford to borrow.

There is an irony here. We are talking about a cost-of-living crisis. The Government has decided to make a universal untargeted payment to everybody, in effect recognising that everybody is affected by the energy crisis. As we introduce the retrofitting measures that are crucial to ensuring we take households permanently out of fuel poverty, as opposed to the temporary measure before us today, we need to ensure the money goes to all low-income households and not just those dependent on social welfare or in social housing.

I welcome the fact that we are taking action by way of an intervention in terms of electricity. I understand the case the Minister made in that this is a measure he wants to move on speedily and the logic that was presented. I have no doubt it will make a big difference to many households. I would not diminish the impact it may have but I would point out, whatever about the speed that is needed in terms of this €200 measure, having been €100, there is a crisis which we have known has been coming for a while. We also know, as does the Green Party Minister, that energy bill costs will go up because the costs of energy, particularly the cost of carbon energy, are so high. We knew that was happening. I am not blaming the carbon tax for the increase in prices; many factors are driving it. The direction of travel, ultimately, is that fossil fuels will continue to create a high cost, with either society carrying that cost, the environment carrying that cost or citizens carrying that cost. That is a fundamental piece about the direction of travel on this issue. Therefore, we should have been planning in advance for the fact and likelihood of energy poverty and we need to do better planning for the next measures we bring in.

We are in a climate crisis. The cost-of-living crisis has received a huge amount of attention in recent weeks. It has been felt by people for a long time. The most fundamental distortion in most households' costs is housing but we will put that aside for now. When we talk about the cost-of-living crisis, I sometimes wonder if we are deflecting from the housing crisis, which has increasingly claimed a greater proportion of every household's income for the past couple of years. I do not know why the measures regarding the cost-of-living crisis suggested by the Minister in his speech would be temporary. They have to be permanent. I refer to measures such as a temporary 20% reduction in public transport fares. In what world of a climate crisis could we imagine putting public transport fares back up again next year? Clearly, that would be irresponsible in the context of the climate crisis we face. I refer to the idea of reducing fee caps for children on school transport. I believe an opportunity was missed in not removing some of the caps on school transport fees. When people went back last September after the pandemic, everybody should have gone back with the option of free public transport that was fully subsidised. It would have made a big difference. It would have made people plan their lives and their families' lives differently.

How could we, in a climate crisis, conceivably plan to change that cap again? We need to be honest that we are in an extraordinary time of flux and change. We are in a period of climate crisis and the cost-of-living crisis sits with within that. We are also facing many political and geopolitical crises. We need to start talking about radical measures as a reality. In every month of the next 18 months, or every six-month period, we will need to be taking measures like this.

In that regard, the inequity that exists in a blanket and universal measure like the €200 payment certainly should not be replicated. There is no excuse for it to be replicated with retrofitting. There is a concern there. There is no excuse for having a measure and a retrofitting plan that is designed predominantly towards homeowners rather than those who are most vulnerable. In the retrofitting plan we are told that the plan is for 50,000 houses per year. There was a suggestion that it might be difficult to achieve the 50,000 because of building demand this year. Yet, the plan only allows for 36,000 social houses to be retrofitted across a decade. Why would we not front-load the social housing, given that in many cases the people living in such housing are also impacted by the high fuel prices? Why would we not front-load that within this year or the next 18 months? This is something that we can do. The reason we are not doing it is a dynamic that I am very concerned about. If we continue with this logic and dynamic, it will stop us tackling the climate crisis. The logic seems to be that we want to create market dynamics. Market dynamics in housing have failed us. The market absolutely has a role, but when it comes to climate and energy security, one cannot take gambles on the market. For example, we are hoping there will be demand in relation to retrofitting, and we will do things to encourage that. That is fine. In the next 18 months, however, we should really be trying to retrofit every house that we can and take that as direct action from the State, rather than this hands-off and market encouragement approach that we overly rely on.

Like others, I was at today's committee session with the Commission for Regulation of Utilities. Frankly, I am extremely concerned because, while I do not put this on the Minister, Deputy Eamon Ryan, much of its narrative was very close to the line "shop around". That is very much the framing. It is the idea that individuals, families and households will make all of these very complex decisions, that they will maximise, that they will save €50 here or €100 there, and that this will create the pressure on the market and then the market will suddenly start producing green energy at an affordable price. In fact, the State has tools such as the regulator to try to address energy costs strongly. There is, however, a reluctance to use this. Again, it was the same language of market encouragement, consumer pressure and customer pressure. Many people are not in that position. It is the same when we are talking about this particular Bill, which relates to electricity costs, and it is the same again with the retrofitting scheme, unfortunately.

Renters are a big gap here. How will renters be supported and how will this benefit them? Much as with the retrofitting scheme, there was opportunity to put in security of tenure for renters and harder pressure for landlords with the stick and not just the carrot. That is important. The opportunity has not yet been taken in terms of retrofitting.

Another cohort that is very vulnerable are those on meters. It is a concern if 12% of households, including some of the most vulnerable people in our society, are not going to be able to benefit from this scheme in the same way.

Another piece that is regrettable is one that the Minister had signalled. Perhaps he has pressed for it. I hope he would continue to press for it. I refer to the expansion of eligibility for fuel allowance. This is something that many of us expected. Again, however, it has been disappointing that we have not seen more of a press on the fuel allowance, which is a targeted tool that we have, and the attachment and extension of it as widely as possible to those who are receiving social welfare allowances. Maybe there could be an examination of those households - I believe it was 20,000 last year and 3,000 so far this year - that have been rejected for the fuel allowance, so that we can see the basis for them being rejected. Obviously they are households that feel that they are vulnerable and need this support. How can we adjust the criteria so that fewer of them fall out of the fuel allowance net? I hope we can address this before September.

I welcome the Minister, Deputy Eamon Ryan, into the House. I agree with Senator Higgins with regard to the public transport provisions. I am aware of the measure introduced by the Minister for reduced fares for younger people, which is very welcome, but it should go further. It represents a good start. I agree with Senator Higgins that if we introduce a 20% reduction in the cost of public transport, we should keep that reduction. I am not an expert on inflation, but if we reduce it by 20% now and then choose to increase it in January, a 20% increase - or as it would then be a 16.7% increase - will actually contribute towards inflation in January. I would like to see this be allowed to continue.

I certainly agree with some other points. The fuel allowance is a targeted measure, and the measures in the budget also must be welcomed. The lump sum in March has to be welcomed. I agree with a lot of the comments made by colleagues but maybe we could broaden some of the debate. We are going to see a lot of price volatility around electricity over the coming years. It is not just because of some of the geopolitical concerns, but also because we will see a rise in electricity demand. If we are to see the electrification of transport, which is something I support, this will lead to a rise in demand. If we are going to look at green hydrogen, which we must focus on, this will also require through electrolysis renewable electricity to be used. We are going to see a move out of fossil fuels, which is welcome, but this too will present some of its own challenges around demand. Ireland must ensure it has the necessary supply as a result.

There are a couple of questions that need to be asked. One is around the planning process. It takes far too long from the inception of some wind energy and solar energy projects to get them up and running. I am thinking in particular of offshore projects. I worry that some of the measures being announced are welcome in the short term but we need to start to think about long-term electricity demand and how we can ensure the supply is there, or else we will be constantly dealing with issues around energy prices.

The Minister might be able to answer another concern I have with regard to reviews at European level of the EU wholesale energy and power market. I am aware that Spain has been expressing concern, as a member state, that essentially we are selling cheap renewable energies on that market at roughly the same price as, or in some cases even costlier than, fossil fuel-produced markets. I struggle to understand why Ireland is not as supportive as it could be in that regard. There was evidence last October of Ireland opposing some of the electricity market reforms. It would be welcome if we could look at the European energy market to see how we can ensure there is an incentive for that renewable energy to be produced.

My final point is slightly tangential, but it is relevant because it is around the research into renewable energies, how we reduce some of these costs in the long run and Ireland's membership of CERN. Ireland is one of only three European countries that does not have any real relationship with the world's leading physics research laboratory, which is looking at all of these areas of new and renewable energies. If there is one thing we should have learned from the global pandemic it is that to get us out of some of these challenges, we must co-operate with other countries. Similarly, when it comes to ensuring we tackle the climate crisis, while at the same time ensuring we continue to have a reliable supply of good renewable and clean energy, we must co-operate at a global level. This has been spoken about for far too long but I believe that as a measure to ensure we play our part in global research into cheaper but more environmentally friendly energy, it is essential that the Government indicates very clearly that Ireland will join CERN. I support the measures announced today.

I welcome the Minister, Deputy Eamon Ryan, to the Chamber. I welcome the Bill before us, which relates to the cost of living and energy costs for Irish householders. It will have a hugely beneficial and real immediate impact once it can be processed.

The electricity cost emergency benefit scheme is welcome. A sum of €100 was announced before Christmas, which is to be amended to €200 in recognition of the price increase for wholesale gas. I also welcome the Government response, with the cost-of-living measures that were agreed last week. It is a realistic, targeted package, which will have an immediate positive impact by putting money back in people's pockets by quickly deploying cash to all households. That package of €505 million encompasses a range of measures to mitigate the cost of living, including a €125 fuel allowance lump payment, the energy credit of €100 excluding VAT, which we are dealing with in this Bill, an increase in the weekly income threshold for the working family payment, a reduction in the drugs payment scheme threshold, and a maximum annual charge of €150 per family at primary level and €100 per family at post primary for the next academic year for school and public transport fare reduction. Those are all positives. They are targeted and reduce costs for families. I welcome all of that.

There was a debate about the carbon tax. The beauty of the carbon tax is that it is ring-fenced. People know that the money being collected for carbon tax goes to the retrofitting of homes. The Minister, Deputy Ryan, announced a scheme last week which has been very beneficial. If climate change did not exist, which of course it does, retrofitting homes and reducing costs would still be beneficial. The carbon tax is targeted and important. There is a scheme relating to the carbon tax for farmers, which will be rolled out under the new Common Agricultural Policy in 2023. That is an area where the carbon tax is being used for environmental gain.

Some people have spoken about the cost of Government subsidies for fuel, diesel and petrol. There is a high cost, but it also goes into general taxation, which pays for all the services that are provided across the country, in urban and rural areas. I have heard people say, quite dismissively, that tax collected in rural Ireland is all spent in Dublin. That is ridiculous. Plenty of taxes and services are provided and spent in rural communities. Every public official, teacher, garda, nurse, public servant and special needs assistant as well as our health services are paid for from general taxation and they provide the services that people avail of. We also welcome the €597 million in roads funding that has been announced. There is some €37.6 million for Galway County Council, which is beneficial.

I also welcome the Government investment of €25 million announced some weeks ago for Rossaveal fishery harbour. This will be potentially used in the building, maintenance and servicing of wind farms off the west coast. A project by Macquarie's Green Investment Group at Sceirde Rocks off the west coast received relevant status from the Department in the first half of 2020. This important project can progress through the planning permission process, subject to the Maritime Area Planning Act, which was recently passed by the Houses. That is positive and has potential to harness offshore and renewable energy to allow us to become a country that exports energy. That will help to reduce the costs of fuel and our reliance on fossil fuels. Fossil fuels and gas will play a part over the coming decades, which is acknowledged. The potential of offshore energy is substantial. I welcome this Bill as a positive step to assist families with the cost of living.

I had not intended to speak on this Bill. I welcome the Minister to the House. There are two or three provisions in this legislation that are reasonably good. For many years, I have listened to people outside talking about us living in a bubble in here, totally removed from real society. How many people sitting round the Cabinet table or in this House have ever experienced real poverty? I mean people who could not even put a slice of bread on the table. I remember one time in my life having three beetroots and a sliced pan for dinner for me, my wife and my two kids. I cannot begin to express the anger I feel at throwing out €200 to every electricity account in Ireland, including holiday homes, the rich, or people like me who are on a good income and do not need it. I will not take it. I am not saying that from a populist point of view but because I meet people who are struggling to live.

I speak frequently in this House about members of the Defence Forces and how tough they have it. A sum of €200 would make a huge difference to these people. I appreciate that the effort here was to get the payment to the public quickly, but what will we do if oil prices hit $150 per barrel by the end of the month? How will we meet the demand or the cost increase if this goes on? How will we address that? We are using borrowed money to make sure people who can well afford to pay their ESB bill get €200 from the Exchequer. There were matrices that the Government could have used to make sure the payment was targeted. We could have sent it to those who receive the working family payment, rather than every citizen in the country.

There are good things in this legislation, but there are others that are difficult to understand. There is a 20% reduction in the cost of public transport. What about those who cannot avail of public transport because there is no public transport service close to them? It is good to see the caps on school transport costs and the change to the drugs payment scheme, but I cannot get away from the €200 payment. I walk around south Dublin, where I live, and see some houses which cost €7 million or €8 million, knowing that the owners are getting €200 off their ESB bill. I ask myself how any of us in this House can justify that. It is totally unacceptable. It is the crudest measure the Government could have used. How will we pay for this? How will we continue to support people who find themselves in an energy crisis as energy costs go through the roof? The way things are at the moment on the geopolitical stage, we could find oil prices hitting $150 per barrel by the end of this month and gas supplies being reduced around Europe.

One of my colleagues mentioned landlords. A number of landlords rent out properties and control every aspect of those properties. They will get €200.

I appreciate what the Minister is trying to do, but the methodology being used is utterly wrong. I will table an amendment on Committee Stage proposing to remove the €200 payment. I know people watching this debate will say "To hell with him, I want my €200." We would all take €200 if it was thrown at us but at the end of the day, this is not the way to go. We in this House are capable of providing a much better service to the public than introducing a measure as crude as this. I regret I will not be present to hear the Minister's reply because I have another meeting to attend, but I will read his reply. I am happy to meet him at any stage to discuss this matter with him. I know he is a decent guy, but this is all wrong and I believe he is being badly advised.

I welcome the Bill and the opportunity to speak on it.

The Minister is very welcome to the Seanad.

I want to echo the comments and sentiments expressed by other Senators in terms of having a preference for more targeted measures. I accept the limitations of our ability to do that within a short period of time. It is important that measures are rolled out quickly to show the understanding of the impact of the rise in the cost of living on people. People are really struggling and the cost of living crisis has crept up on us. This time last year, or even six or three months ago, it was all about the pandemic and Covid, and how we could deal with that. Prior to that, it was all about Brexit. Now the real crisis we all have to deal with on a daily basis is the cost of living which is impacting on everybody in communities and society.

We know the current average domestic customer bill is approximately €1,715, comprising €976 for electricity and €739 for heating. Several reports estimate an overall increase of another €500, a rise of approximately 29%. That is colossal. We need to make sure that we are doing everything we can to alleviate the pressure on household incomes, and such measures are welcome. The €200 electricity credit will make a difference. I ask those who feel they do not need it ensure they give it to a local St. Vincent de Paul service or other such organisations that help those who could do with more than €200.

The lump sum payment of €125 in the fuel allowance will be paid in early March to 390,000 recipients. There is no doubt that will make a difference, but we need to widen the eligibility threshold for the fuel allowance. I ask the Minister to consider that as a matter of urgency. These measures will not cover the impact of the increased cost of fuel and electricity, but they will make a difference. To say they will make no difference is simply untrue.

We also need to be clear that the increases we are all seeing in fuel and electricity costs are based on international factors. Certain political groupings which are trying to paint the imposition of carbon taxes as the root cause of our issues are being completely disingenuous. They are damaging our collective efforts to encourage people to shoulder the responsibility of reducing carbon emissions.

I want to acknowledge that the Government has been to the fore in tackling climate change and there is no doubt that we have seen a distinct focus on climate mitigation measures. The recent retrofitting announcement is important in this regard and is something that we need to replicate. New grant levels have been announced. They will cover up to half of the cost of a deep retrofit and up to 80% of the cost of doing simpler work, which is important. Such work could knock about 20% off the cost of annual heating bills.

I have two pleas for the Minister. One is regarding the loans that will be made available for those who need to draw them down. I ask that the Minister consider the possibility of rolling out those loans through the post office network. Practically every rural community has a post office. We have a dedicated group of people who are very committed to their communities. It would be a good way of rolling out loans. I also ask the Minister to make sure that the red tape and bureaucracy around the administration of the loans be minimised because that is one complaint about the current SEAI scheme.

I want to mention the 20% reduction in fares on public transport, which is very welcome. I would like to once again advocate for a medium hop zone for the south Kildare area. As we know, people are travelling from Portarlington, Kildare and Newbridge to Sallins because it is within a short hop zone. They are staying on the roads and driving due to the difference in fare price, when they could access trains in their towns. The price in Sallins is one third of the price of the journey from Newbridge, which is 6 km away. That has to be examined. Some cannot access public transport because there is simply no public transport for them in rural Ireland. I speak for rural Kildare. We need to have a bigger investment in our local link service which would be able to bring people to hop zones.

Overall, this is a positive Bill which goes some way towards tackling the spike in prices. We need to keep the pressure up to ensure that additional supports are put in place.

I welcome the Minister to the House. We are discussing the Electricity Costs (Domestic Electricity Accounts) Emergency Measures Bill. The Minister is fully aware that we are in the middle of a global energy crisis and that the impact of inflation in the eurozone is nearly 7%, never mind what is happening in the United States.

The Minister mentioned the short, medium and long term. In the short term we need to take action right now. That is the €200 that will be put into over 2 million household accounts by April. That is immediate action to deal with an issue that is facing us right now. The Minister also mentioned the fuel allowance. I agree that we need to review the eligibility criteria, but it will benefit up to 70,000 households.

When it comes to the medium term, there is investment in the retrofitting scheme which is important. Last week, 100% funding was announced for those who are most vulnerable, 80% for wall and attic insulation and up to €25,000 for a full energy home upgrade. The Minister, Deputy Harris, referred to the centres of excellence that have been rolled out for the retrofit scheme. There are now four across the country. We need to upskill people and get them up to speed in their trades so they are able to roll this scheme out. I do not know if the Minister can speak about the plans he has in place to manage the waiting times around that.

Yesterday, €430 million in funding was announced for the third level sector. Half of that will go to technological universities. There will be four funding streams, one of which will be around apprenticeships. Technological universities will have the capacity to develop more and more students coming through to do apprenticeships linked with employers. That is crucial.

The Minister also spoke about the long term, which comes back to renewable energy measures, in particular offshore wind farms. I am curious about how the micro electricity scheme has progressed since the announcement in December. Does the Minister have any update on that? It would be very interesting to hear about that. It has huge potential in terms of our farms and schools being able to have solar panels which generate their own electricity while also paying back into the grid under the export certificate scheme.

The Minister knows I am from Ballinasloe and he knows Ahascragh pretty well. East Galway and Roscommon are quite regional areas. The Minister is very aware of the transport challenges we face. I was involved in the Connecting Ireland scheme during the public campaign. I did two campaigns, one in Roscommon and a second in east Galway, to promote transport and how we want to connect our universities and hospitals, such as TUS in Athlone and GMIT in Galway. There is no real connectivity between key institutions, amenities and hospitals in our area, such as Portiuncula Hospital and Roscommon University Hospital.

What is the outcome of the Connecting Ireland rural mobility plan? Is there a timeline for when there will be an outcome? A number of different routes were suggested. In the past week a reduction of 20% in fares on public transport was announced and the cap on school transport costs at €500 for a family with secondary school children is welcome.

However, an awful lot of people in my area are annoyed because that is of no benefit to them. Such measures are brilliant if people are living in city or town centres. The fare scheme for students aged 19 to 23 was introduced in the budget, which involves half-price travel. It should be implemented as soon as possible, along with the working family payment.

What about the Connecting Ireland scheme? When will we get the feedback from that? When will there be more transport between our smaller villages and towns? When will there be basic bus stops with a cover on them? It sounds like we are asking for the sun, moon and stars, but when I was a councillor I invested in one bus shelter. We could only have one on one side of the road in Ballinasloe because of the width of the footpath. There is no cover for people waiting at bus stops. The bus stops at the hospital are covered, but older people, those with disabilities and those with families, including children in prams, are being asked to wait on the side of a road. It is crucial that we have quality of life because people now demand more than they did 20 or 30 years ago.

People now demand more than 20 or 30 years ago. There are people who are taking taxis right now and how does this funding of a 20% decrease in public transport fees benefit them? I know it is hard for the Minister to provide answers immediately and I very much appreciate the short-term and immediate measures that the Government has taken straight away. In the medium and long term, how will we get back inputs from the measures being put in place over the past few months?

The Minister is very welcome and I am delighted to get the opportunity to speak to the Bill at a time when people are facing real hardship in their lives with inflation and rising energy costs. These costs have led to many families spending a higher proportion of their income on food and fuel. Electricity prices have increased by 22%, gas prices have increased by 28% and the price of home heating oil has gone up by a massive amount in excess of 50%. I have a small business that includes a fuel court and we can see when every delivery comes in there is a 5 cent or 10 cent increase. That has happened over the past ten months or so, leaving many families with the painful decision between heating their house or feeding themselves. The rising cost of electricity is a global trend and it is causing cost-of-living issues all around the world. Here in Ireland it is affecting pensioners and families whose income is not rising enough to keep up with increasing energy costs.

I welcome this measure and the Bill that has been brought forward by the Minister as part of the Government, and it will put €200 towards every household electricity bill. It may not be enough for some families and we must put in place an extra fund for those who may continue to find themselves in hardship. I am in favour of perhaps having a smaller grant for all account holders while giving additional funding to others, as has been done through the fuel allowance, or increasing the credit in the household scheme, particularly for the likes of older people and carers, to give a larger number of free electricity units. It would be a more targeted approach.

I have a few queries. We have heard mentioned the question of holiday homes and where landlords have kept the electricity accounts in their own names but customers are using prepaid credit purchased in various shops. We must also consider the development of long-term and sustainable options to make electricity more affordable. There is much potential in this country to deliver wind energy offshore on a massive scale. This would create jobs in our towns and villages along our coastline and it would be capable of being our biggest contributor to the effort to reduce carbon emissions. We must tap into that resource.

I welcome the recent enactment of the Maritime Area Planning Bill 2021, which will help us achieve our renewable energy targets and regulate planning for offshore wind. There is a major opportunity to develop solar panels on various schools and community centres, as well as on agricultural sheds throughout the country, and this would cut costs while also providing income. I know there is a Private Members' Bill from the Minister's colleagues in the Green Party being discussed here tomorrow related to that and I will support it fully. I am involved with my local community centre and we recently installed solar panels. We had to go through the expense of having to get full planning permission to do that. I welcome any change in that regard.

I also welcome the national home energy upgrade scheme, which will provide up to €8 billion to 2030 for the retrofitting of houses. We can think back to when the Green Party was previously part of a Fianna Fáil Government at the time of the crash, and although these types of schemes were suggested, the funding was a problem. If we had funding at the time to retrofit more houses, we would not have as many issues as we do today. This scheme will address a major challenge for households, as the question was being asked as to whether it made financial sense to spend money on such work. A constituent of mine who had a detached house built in the 1940s with solid stone walls got a quote of €26,500 to do an external retrofit, with a grant set at €6,500. That person decided it did not make financial sense to invest the difference in the work as it would take perhaps 40 years to claw back that investment. I welcome this scheme, which makes it more realistic for people to spend money on such work and get benefits from it.

I support the comments of Senator O'Loughlin about a loan scheme. The Minister may know I also work for An Post and there would be a great opportunity to work with that company, which has previously set up the Green Hub scheme. I would like to see the Department working with An Post to roll out that loan scheme. It is important for us as public representatives to promote this scheme in all our local areas and ensure people avail of it.

I will digress slightly to the matter of roads. I spoke to the Minister when he came before the transport committee a number of weeks ago about the N4 in particular and how a preferred route has not been identified. Funding has not been put in place for the consultation process to continue and we were only a number of weeks away from identifying an initial preferred route before we could have further consultation. I ask the Minister to comment or is Transport Infrastructure Ireland in a position to provide that funding to ensure the scheme could continue? This would enable us to have a nailed-down preferred route rather than having hundreds of families left affected by the ten identified routes. They cannot get planning permission as a result. Will the Minister comment on that?

That concludes the contributions from Senators so I invite the Minister to respond to the debate. I ask him to do his best to do it within ten minutes.

It will not be a problem for him.

I thank all the Senators who contributed to what has been a very useful and interesting debate. I very much appreciate the thought and time they have given to their contributions. I will not address every matter raised but I will try to cover as many as I can.

I will start with Senator Boyhan, as some of the points he raised were also mentioned by a number of other people. There is the question of everybody getting this credit. We must look at this and recognise that this is not the only measure that the Government is applying to address energy poverty. The primary means or mechanism for doing this is the budget. The measure before us is unusual or exceptional and I do not believe it will be repeated. We are in unprecedented times. The majority of the measures to address energy poverty were contained in the budget.

What Senator Boyhan said is true because we have been watching these gas prices rise for almost a year now with increasing concern. The increases arise because of factors that include a rise in demand in Asia and very low stocks in Europe. Even last summer there was a very low incidence of wind across north-west Europe, leading to gas demand increasing. The increasing price of carbon shut coal plants, leading to more gas plants being used. There is an incredibly complex range of factors that caused the particular spike in gas prices at the centre of this energy price spike that we have seen. This is why the Government in its budget introduced significant measures for social welfare, including increases in household allowances, the qualified child allowance, the working family payments and the fuel allowance.

It recognised that we must target and try to prevent fuel poverty in everything we do. I attended the European Council of energy ministers and environment ministers in the autumn and it was indicated that we had to go further across the board in countries across Europe. This was because we were not seeing prices come down as quickly as we expected them to. We still expect them to come down, although again not as quickly as expected. The European Commission's expectations for inflation in our country next year will be between 2% or 3%, I believe. The expectation is that inflation in gas prices will come down, although not as quickly as we would like. The rate is far higher than historical precedent suggests. The European Commission indicated in the autumn that we should start looking at other measures for further support.

Included in that toolbox were direct payments. We might have looked at mechanisms including reducing VAT or taking from the emissions trading system, as mentioned by Senator Boyhan. With this measure we have taken from an underspend in the previous year and provisions from the Minister for Public Expenditure and Reform in contingency funding in order to make a direct payment to everyone.

If it is seen just in isolation people think we are looking after everyone in the same way. We are not. There is a range and sequence of other measures. Included in this is the money for retrofitting. There is €267 million from the Department and €85 million from the Department of Housing, Local Government and Heritage. Senator Higgins and others said it is not targeted. It is targeted. The majority of money is targeted at those on low incomes. Out of the €267 million approximately €118 million-----

The Minister without interruption.

I said the overall retrofitting scheme did not do enough to target those on lower incomes.

I thank the Senator. The Minister without interruption.

It is useful debate. The warmer homes scheme, which is 100% State support for those at most risk of fuel poverty, gets €118 million out of the total, and rightly so.

I do not have the full details on how the Department of Housing, Local Government and Heritage is progressing on it but it is getting stuck in. It is learning. It is deeply committed. The Government is committed to tackling three issues with all of our heart. These are: tackling the health crisis of Covid and reforming the health system; addressing the housing crisis, which is particularly profound in our areas of the country; and the climate crisis. The climate crisis requires an all-of-government effort and not just from the Department with responsibility for climate action. The €85 million, which is not a small contribution and which will scale up as the Department learns, is targeting those on the lowest incomes. I can understand asking why we are giving something to everyone but we are not. We are targeting it.

The payment was deliberately designed so it could be done quickly. These are the months we need the support. We do not want people out there saying they will turn off their heating now. It will be cold next week and bad weather is forecast. We do not want people who might be at risk of fuel poverty saying they will live in the cold. This is one of the biggest health risks we have. Having it payable now in the teeth of the highest spikes in prices is the right thing to do. Doing it directly through the bill and through the networks means it is a rebate straight back. We looked at a range of issues. Senator Boylan asked about EU emissions trading system funding. We looked at this. The funding would not have covered the amount of money we need. This way is quick and something we could do in an effective low-cost way. It was designed to leave no one behind.

To answer the question about those in the rental sector, the Bill has been specifically designed so that the vast majority will be recipients of the direct credit as they get the bill. In instances where people do not get the bill, there is clear provision for the Residential Tenancies Board to be able to act as a mediator should a landlord not pass on the benefit. This has been designed to protect those in vulnerable positions. Tenants are just as important as the owner of a household.

I am very conscious I am constrained by time. I have probably almost busted my ten minutes. I want to mention a couple of other points. Senators Dolan, Carrigy and others mentioned the transport provisions. The heat of the price crisis at present is in energy and transport because of oil and gas. Gas is increasing electricity bills as well as heating bills because our electricity bills are set by the price of gas. Transport is also a significant cost and it has seen increases. We have to be careful in fighting inflation. If we just pump money into the economy to fuel inflation it could be very counterproductive. We want to give a clear signal to people with regard to their everyday real lives and the bills they have to pay, such as prescriptions and bus or Luas fares. Bringing these down helps, particularly for those struggling to meet day-to-day costs. The reduction in transport costs was also needed.

The measure on transport is also needed because our public transport is slow to come back after Covid. Average patronage is approximately 60% of pre-Covid numbers. It varies. In the regional cities it has taken off. In Limerick I understand it is back to almost 100%. We have introduced new services, such as in Navan and Louth, where we have redirected bus services and these have gone above what we expected. We will have to get more buses and drivers into some of these areas. The new services have taken off.

To respond to Senator Dolan, I do not have the full details on the consultation process with the NTA on Connecting Ireland but I believe it is one of the most important investments in public transport we have made. It has the potential to be creative and efficient whereby, in just the way Senator Dolan has spoken about, we connect our public transport and local link services with local health services, social welfare service and schools. This is an opportunity.

We will have to do this well because there is not an endless pot of money. It is the public's money we are redistributing. It is the tax we pay. Only a government can do this in a clever and intelligent way to do things that only the public service can do, such as a public transport system or protecting social welfare for those who do not have a safety net. Tax is not a bad word from my perspective coming from the left because it gives us the ability to protect or to invest in a way that as a private citizen we can never do. We can never get the security from our neighbours, which is part of our security, if we do not have the tax revenue.

We are going to have to be efficient and clever. We have put a lot of money into these measures because it was important to have a response immediately but the State also needs to get good value from the money we spend coming out of Covid. We must be very clever and smart in how we spend it. I will finish with this thought. I was worried about being a bit inflationary until I heard the Opposition the day after we announced the €500 million calling for spending of €1.5 billion and €2 billion. I will raise them €3 billion. Let us make it €4 billion. We have to be careful.

Question put and agreed to.

When is it proposed to take Committee Stage?

Is that agreed? Agreed.

Committee Stage ordered for Tuesday, 22 February 2022.
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