Dáil Éireann Debate, Tuesday - 22 September 2020
27. Deputy Claire Kerrane asked the Minister for Social Protection if her attention has been drawn to the prevalence of energy poverty here, the increased energy costs faced by families due to more time being spent at home in recent months and rising energy costs; the steps she will take to address the issue; and if she will make a statement on the matter. [25250/20]
View answerI want to ask the Minister about energy poverty and the difficulties faced by vulnerable households owing to increased energy costs. These households have spent longer at home in recent months and will have higher energy bills.
I thank Deputy Kerrane. The Government is committed to protecting vulnerable households from the impact of energy costs through a combination of supports, energy efficiency awareness initiatives and investment in programmes to improve the energy efficiency of the housing stock.
With regard to income supports, my Department provides a range of schemes to assist with energy costs. These include the fuel allowance, which is a payment of €24.50 per week for 28 weeks from October to April, giving a total of €686 per annum. It cost in the region of €261.35 million in 2020 for payments to an average of some 352,000 low-income households. Payments for the 2020–21 fuel season will start to issue under this scheme next week. Also included are electricity or gas allowances under the household benefits scheme, at an estimated cost of €194 million in 2020; a special heating supplement under the supplementary welfare allowance scheme; and exceptional needs payments, to help meet an essential once-off cost that an applicant is unable to meet out of his or her own resources. Owing to the Covid-19 emergency, the fuel allowance 2019–20 season was extended by four weeks from 10 April to 8 May 2020 to help protect the vulnerable during the lockdown phase of the national response.
As committed to in the programme for Government, the ESRI is carrying out a study on how best to minimise fuel poverty in the context of carbon tax commitments. The programme for Government has committed to hypothecating all additional funds raised by the carbon tax into a climate action fund, which will be utilised, in part, to provide for targeted social welfare initiatives to prevent fuel poverty and ensure a just transition. This was done in the last budget when €21 million was ring-fenced from the approximately €90 million being raised from the carbon tax increase to fund an additional €2 per week in the fuel allowance and to add an additional €13 million to the warmer homes scheme allocation. It is made available to retrofit the homes of people in or at risk of energy poverty.
It is always the case at this time of the year that lights in households are turned on earlier and more heating is required. Uniquely this year, more people have spent more time at home than usual and they face increased energy costs. I appreciate that the fuel allowance season was extended, that procedures were put in place and that disconnections were banned, all of which measures were of help to the families but they now face higher bills, which are mounting.
The Minister will probably know that, last December, the Society of St. Vincent de Paul published a document on the prevalence of energy poverty in Ireland. She may also know that in 2018 alone, the society spent €5 million just to assist families and households to meet their energy costs. That is an extraordinary amount of money. All the supports the Minister listed are clearly not making much sense when the Society of St. Vincent de Paul is spending €5 million in one year just to help people. That should sound alarm bells. I ask the Minister to consider fuel poverty in line with the budget.
I thank the Deputy. She makes a fair point on the impact of Covid-19 on energy costs. Obviously, if people are spending more time in their homes because of Covid-19, it will have a knock-on effect on energy costs, particularly as we enter the winter months. As I stated, the fuel allowance payments will start to be issued from next week. Over 350,000 households were supported by the fuel allowance this year and we extended the payment this season by four weeks.
The Sustainable Energy Authority of Ireland, SEAI, does absolutely fantastic work on improving energy efficiency in homes through schemes such as the warmer homes scheme. It has its biggest ever budget this year, at almost €53 million. We need to build on the great work that was carried out as part of the warmer homes scheme through retrofitting the homes of people at risk of energy poverty. We need to examine this in a whole-of-government context in terms of the work being carried out by my colleague, Deputy Eamon Ryan, the Minister responsible for climate action. As the Deputy will be aware, the programme for Government and the climate action plan set very ambitious targets for retrofitting and making homes more energy efficient.
I stand to be corrected but I believe many of the grants available through the SEAI, which are welcome, are part payments. In many cases, households simply cannot afford to put any money aside to try to retrofit their homes or make them warmer. I agree, however, that it cannot just be about spending money on and adding to the fuel allowance every year; it has to be about making the homes warmer in the first instance in order that people do not have such high bills. We must acknowledge that cost is a factor. We have the fourth highest electricity costs in Europe. The same applies to gas. Taking out the taxes and charges, suppliers in Ireland are charging a fortune, way above the EU average, for electricity and gas. We must couple this with the fact that Electric Ireland has announced it is increasing its charges from October. Carbon tax increases were introduced in May, despite our being in the midst of a global pandemic, and we are aware that the PSO levy is due to increase in October. These will increase bills and make it more difficult for people to turn on the heating.
I would like the Minister to mention the report on the impact of carbon tax on low-income households, which I have raised with the Minister previously. When will it be published?
To follow on from what I was saying, retrofitting will play a major in the Government's plan for economic recovery. The July stimulus package commits to an increase in the SEAI budget of €100 million in 2021. That is a considerable increase. Only today, the Minister responsible for climate action, Deputy Eamon Ryan, announced €28 million under the community energy grant initiative. That will benefit almost 1,500 homes and community buildings by making them warmer and more energy efficient. The Minister responsible for housing, Deputy Darragh O'Brien, will, through his Department, focus strongly on local authority houses required under the retrofit scheme, particularly in the midlands. We want local authorities to engage and to upgrade their houses. All of this will help to bring down the cost of energy.
The Minister has a draft of the report on the impact of the carbon tax and low-income households. When might the report be published?
The ESRI is carrying out a study of carbon tax commitments. Its findings will inform the Government on this issue. I have not received those yet but when I do, I will obviously publish them.
