Dáil Éireann Debate, Tuesday - 13 December 2022
71. Deputy Alan Farrell asked the Tánaiste and Minister for Enterprise, Trade and Employment if he will report on the efforts to assist businesses with the rising energy prices; and if he will make a statement on the matter. [62069/22]
View answerThis question will be introduced by Deputy Carroll MacNeill.
I ask the Tánaiste to report on the efforts to assist businesses with the rising energy prices.
I am very conscious business owners and managers are worried heading into the new year. The invasion of Ukraine has had massive consequences for the whole of Europe and not just Ireland. Indeed, we are now facing a global inflation crisis exacerbated by the war. Energy and other input costs have risen considerably. Interest rates are rising and consumer confidence is waning.
It is fair to say the Government has not been found wanting when it has come to helping businesses get through difficult periods and saving the jobs of the people who work there. That was particularly evident with the employment wage subsidy scheme during the pandemic. My message to small and medium-sized enterprises, professionals and farmers is help is available. The temporary business energy support scheme will provide qualifying businesses with relief on 40% of the increase in their electricity or gas bills up to a maximum of €10,000 per month and €30,000 in some cases. It is important businesses get their paperwork and bills in order, register and make a claim on revenue.ie.
Along with the Minister for Public Expenditure and Reform, Deputy Michael McGrath, I launched the Ukraine enterprise crisis scheme for manufacturing and internationally traded firms in October. It is assisting firms suffering liquidity problems and those impacted by severe rises in energy costs. I anticipate further modifications to the scheme will be announced shortly. We are also complementing financial grants with State-backed, low-cost loans. The State-backed Ukraine credit guarantee scheme will be open within weeks and will assist the wider business sector with liquidity, investment in energy efficiency and working capital for the next few months and years. Furthermore, a new State-backed growth and sustainability loan scheme will open for applications early next year. This is a successor to the popular future growth loan scheme.
In the medium to long term, we will help businesses invest in energy efficiency and reduce reliance on fossil fuels. There are about 20 energy efficiency schemes already available but take-up is not what it should be. That is perhaps because people do not know about them or may not perceive a return on investment. We will work to ensure the right incentives and information are in place to improve take-up.
I thank the Tánaiste. There is a huge opportunity with that. I would like to know what level of interest has been expressed to him on the State-backed guarantee scheme. I recall during Covid there was scepticism about a previous iteration of that but the number of companies taking up the opportunity of those loans was actually very high. It is something that could be kept in perpetuity as a model for financing corporates that are trying to get through difficult periods or trying to expand in particular ways. The Family Business Network highlighted to me that energy is a major element in manufacturing.
Among its members, on average, fuel costs have gone up 80%, freight costs are up 20% and chemical, steel and similar input costs have gone up between 15% and 25%. These are major additional costs for any business. I will address energy prices in my next contribution.
Roughly 10,000 businesses availed of the Covid loan scheme and the Brexit loan scheme. The Ukraine loan scheme is essentially-----
-----the same thing.
-----a version of those for the current challenge. We do not know yet what the take-up will be like. The first of the main banks will be offering it in the next few weeks. We will have a better idea in six weeks or six months. What I can say for sure, though, is that the growth and stability loan scheme will be very popular. It is the follow-up to the future growth loan scheme, which was fully subscribed. This is for businesses that are expanding and want to invest in energy efficiency. We think that scheme will be very popular.
I tend to agree. As the Tánaiste becomes Taoiseach this weekend, I make one request of him in relation to the opportunity he identified on wind energy. I met representatives of a group of wind companies form Denmark, Norway and Ireland, which have European- and Irish-backed funds. They spoke to me about the opportunity in Ireland and said we are possibly missing the chance to realise it quickly enough because of the gaps in planning, grid and demand certainty. Even if the first round of auctions goes through and that becomes operational, we will have much more capacity than demand on the island. These companies are making the point that without data centres running as a constant, they cannot be sure there will be sufficient use. There is so more use needed - I am sorry, it is 1 a.m. and I am not saying this well – to be able to sustain the amount of energy produced. They have to build into the risk profile the possibility of turning off turbines in the absence of demand certainty.
EirGrid told me, and this is important to highlight, that it has missed target after target in relation to grid certainty. While the company needs more resources, it also needs to deliver the grid development target set for it. I know there is a big change on the way in planning. There is no point in talking about 800,000 sq. km of opportunity. It simply has to get done on a practical basis now before the financing investment moves elsewhere in Europe or to the United States and we lose this once-in-a-lifetime opportunity.
On the planning certainty, the Maritime Area Regulatory Authority will be up and running very soon. We need to make sure we do the seabed mapping as well because it will not be possible to grant consents unless that is done. If we need to find innovative ways to do that, we should.
With the exception of Dún Laoghaire.
That is true.
When it comes to grid certainty, the Deputy is absolutely right. We need to invest a lot in the grid in the year ahead. I had not heard the point about demand certainty before.
It is very interesting.
Even though it is 1 a.m., it was interesting to hear something new of that nature. At the moment, we have so much demand and not enough generation. I can see how that could flip very quickly and we would then be wondering why we did not see it coming. We cannot say that now because the Deputy raised it in the Dáil. We have to be prepared for demand certainty. The best way we can mitigate that is through interconnection, so that if there is excess energy being produced, it can be exported. I do not think the connection to France will be enough.
It is not.
We will need a supergrid. I have heard some interesting ideas around the supergrid and how it could be done. We will also need battery storage, for example, so that we can store energy and then use it at other times.
Proving that patience is a virtue, Deputy Leddin has been reached for Question No. 72.
