Energy Resources: Motion (Resumed).

The following motion was moved by Deputy Durkan on Tuesday, 7 November 2006:
That Dáil Éireann,
acknowledging:
the likelihood of major job losses in both the manufacturing and services sectors in the wake of recently approved gas and electricity price increases;
the damage to national competitiveness that will ensue; and
the recent international trends indicating a reduction in oils and gas prices,
calls on the Minister for Communications, Marine and Natural Resources:
to initiate a full review of the regulatory arrangements which approve huge price increases in gas and electricity at a time when international energy prices are falling; and
as an interim measure, bring forward legislation to enable the Oireachtas compel the Commission for Energy Regulation to instigate a review of prices at any time the Oireachtas so decides so that the latest international price movements can be factored into the cost of energy charged to Irish customers.
Debate resumed on amendment No. 1:
To delete all words after "Dáil Éireann" and substitute the following:
"recognises:
that ongoing volatility in energy prices is an EU wide problem with the EU being the largest importer and second largest consumer of energy in the world and that some member states have substantial indigenous energy resources unlike Ireland;
that natural gas and oil are internationally traded commodities and Ireland is essentially a price taker;
the dependence of BGE on gas imported from the UK, over 86% of our national requirement, and that natural gas is the major fuel used in power generation;
that the average cost of procurement of gas for BGE had increased by some 50% over the last 12 months due to the increase in international wholesale gas prices;
the UK market which we share is increasingly reliant on gas and oil sourced internationally;
the geopolitical risk in oil and gas producing countries which must be addressed by the EU collectively;
that energy prices can adversely affect competition and jobs; and
Ireland's strong support for the development of a new common European strategy for energy underpinned by the principles of sustainability, competitiveness and security;
commends the Government on:
its commitment to delivering on energy policy priorities, including ongoing investment in energy infrastructure, ambitious targets for renewable energy, a substantive increase in energy efficiency and the continued opening up of gas and electricity markets to competition, with resultant benefits to consumers;
the publication of the energy policy Green Paper, Towards a Sustainable Energy Future for Ireland, which is informed by input from public bodies and organisations, including the National Competitiveness Council, Forfás, IBEC, the ESRI and the Enterprise Strategy Group;
its commitment to developing an all-island energy market which is designed to deliver, over time, some of the cost efficiencies and investments needed to promote an efficient energy market which contributes to competitiveness;
its liberalisation of the electricity and gas markets, with full electricity market opening introduced in advance of EU targets and steadily increasing levels of competition in that market as well as the gas market;
its strategy of providing increased electricity and gas interconnection capacity, including the development of a 500 MW east-west electricity interconnector and the doubling of north-south interconnection capacity, in order to underpin security of supply and continued economic competitiveness;
its policy of mitigating our exposure to volatile international fuel prices through enhanced fuel diversity, including the setting of ambitious targets and supports for renewable generation and indigenous supply sources;
the launch of a major national awareness campaign focussing on energy efficiency and the benefits to consumers which highlights actions that can lead to energy savings, increased competitiveness and enhanced security of supply;
enabling competition by reforming institutional arrangements and market structure and specifically reducing the market power held by any one player in price-setting generator plant; and
the proposed creation of a State-owned landbank of current and potential generating sites, thus removing a significant barrier to new entrants;
notes:
the fact that Fine Gael refused the opportunity to constructively participate in an all-party approach to developing energy policies for the future;
the CER's commitment to consult on a fuel variation mechanism in tariffs by the end of this year and a possible mid-term review of energy tariffs in 2007 should international fuel prices continue to trend downwards;
the CER's approach to cost reflective tariff setting which is designed to ensure the short and long-term financial viability of the energy sector and to ensure adequate investment in energy infrastructure. A secure and reliable electricity system is a prerequisite for economic stability and to attract the type of industries favoured by the Irish economy; and
the Energy Policy Green Paper commitment to undertaking a comprehensive sectoral review of the energy regulatory framework following the introduction of the Single Electricity Market in 2007.
—(Minister for Communications, Marine and Natural Resources).

I wish to share time with Deputy Fiona O'Malley, Deputy Kelly and Deputy Carty.

I thank the Acting Chairman for the opportunity to speak on this Private Members' business motion. It is traditional to thank the Member who tabled the motion because it gives backbenchers the opportunity to speak on issues of concern to them so I compliment Deputy Durkan and his colleagues in that regard.

The constant fluctuation in gas and oil prices this year has made this issue one of real concern not only in my constituency of Dublin South West, but throughout the country, so it is opportune to discuss it. I do not want to pick on Fine Gael because it is having enough trouble without me doing so.

I thank Deputy O'Connor.

I will however make one point about the motion, which is interesting and raises a number of good points. I am astounded that no reference is made to the issue of energy poverty, particularly as it affects disadvantaged families and senior citizens. Senior citizens and the people who look after them have made that point to me. It is not just an issue in Tallaght, but throughout the Dublin region and the country. I am sure my colleagues taking part in the debate will make the same point. I expect people to visit my eight weekly clinics with a variety of issues but energy policy and poverty have arisen recently.

Other colleagues mentioned that we have received a huge number of pre-budget submissions from all sorts of organisations. The Society of St. Vincent de Paul has raised energy costs, as have businesses. My colleague, the Minister of State, Deputy Conor Lenihan, and I, along with other colleagues in Dublin South West, have received an excellent pre-budget submission from the South Dublin Chamber of Commerce, which is based in Tallaght business park. I have read its submission, entitled Securing Our Prosperity, with great interest, as Members would expect. It questions the ability of business to remain competitive, which is of concern not just in the Dublin region, but in Kerry, Galway and everywhere else.

The cost of energy becomes more acute as winter approaches, although we are lucky enough to be having a relatively mild winter so far. As the weather deteriorates in the next couple of months, as I suspect, it will become an even more important issue. I expect that the issue will not only fall on the desk of the Minister for Communications, Marine and Natural Resources but on those of other Ministers, particularly Deputy Brennan. I expect the Minister for Social and Family Affairs to consider the challenges that presents in a special way.

I do not wish to patronise but I am a fan of the Minister, Deputy Noel Dempsey, and I congratulate him on his work. People tell us there are challenges as far as energy costs are concerned and I hope he understands that Members on the Government benches will say so as much as anybody else.

Other colleagues will be far more technical than I but we are hugely dependent on imported gas — the primary fuel used in power generation — from the UK, amounting to over 86% of our national requirement. The procurement costs of gas have risen by 50% in the past 12 months because of international wholesale prices. The Minister has acted on these issues by making a commitment to deliver on energy policy priorities, which include investment in energy infrastructure and setting achievable targets for renewable energy sources.

The publication of the Green Paper on Energy, which will work towards a sustainable energy future for Ireland, is something we should note. The public bodies which have direct input into this strategy, including the National Competitiveness Council, Forfás, IBEC, the ESRI and the enterprise strategy group are taking a particular interest.

I have just spent a sad three quarters of an hour listening to President George W. Bush's press conference in Washington, in which he took a very benign approach to politics, as happens the day after an election. He spoke about working with everybody——

Maybe Deputy O'Connor should do that. I know what he is talking about.

It was very interesting and distracted me for five or ten minutes. There is a similar challenge for Fine Gael to participate in an all-party approach to developing energy policies in the future. We will all have our politics when it comes to certain things and there will always be occasions when party politics dominate, which I am sure will be the case over the next 230 days or so until the general election. However, on a quiet night in the Chamber such as this, we should understand there will be challenges on which we can all work together and energy policy is one of them. This issue is of great concern to everybody — people in business trying to create jobs, people trying to keep their homes warm and people looking after the elderly and disadvantaged. There are also challenges for our schools and public buildings. I have not felt cold in the Dáil since I arrived four years ago. I do not know whom to tell but maybe a little bit of energy could be conserved in the House as well.

Does the Deputy mean the hot air?

On some days there is a bit of hot air but it seems to be warm enough today.

The issue is of great concern to everybody. I do not want to sound like a Member sitting on the Labour benches but I come from a bygone Dublin era when, even though young and not aware of energy costs, I was aware of the challenges people had keeping their homes warm. We must be careful to help people who have problems in that regard. That is the reason I said earlier — I noticed the Minister of State noting my comment — the Minister for Social and Family Affairs should look at that issue. I expect he will do so.

It is important to have debates such as this. I have already complimented Deputy Durkan and his Fine Gael colleagues for raising the issue which provides an opportunity to discuss matters of concern to our communities. However, I am happy to support the Government amendment.

I welcome the opportunity to discuss this energy policy. No public representative can remain unconcerned about the rate of increase in the price of electricity and gas recently granted by the energy regulator. The cost of energy is increasingly an issue of significant concern to manufacturing industries here.

As a minute and isolated energy market, Ireland was never going to enjoy the security and price benefits which economies of scale can provide to countries on mainland Europe that are well connected to the European grid. Equally, as a market representing 1% of the European electricity market, it is questionable whether the EU directive on liberalisation should have been interpreted by our regulator quite so strictly. A strong case for derogation could and should have been made.

While electricity price increases in Ireland were suppressed for many years, recently prices have increased substantially. Our industrial electricity costs are now the highest in the European Union and are a major threat to competitiveness and, as a joint committee has heard, the survival of many industries. Furthermore, the rate of increase of Irish electricity costs is unparalleled in the European Union, as may be seen from data produced by the Irish Academy of Engineering, which shows that in the period 1999 to 2005 electricity prices here increased by 50% but declined marginally in the European Union as a whole.

The Deloitte & Touche report into the Irish electricity market points specifically to two issues which affect our electricity costs, namely, our fuel mix and the operation costs of ESB generating plants. We are inordinately dependent on imported oil and gas and therefore subject to the vagaries of geopolitical circumstance. While international oil and gas prices are currently declining, the long-term price trajectory is upward. Rather than tinker with short-term solutions, we need a rigorous rehaul of our energy market. We need to provide long-term solutions which will safeguard industrial competitiveness and ensure a reasonable price for the domestic user.

The necessity to develop an indigenous supply through the flow of Corrib gas is compelling and a matter of supreme national importance. As the Deloitte & Touche report points out on page 38, a way to protect against our perilous oil and gas exposure is to ensure the extraction of this valuable resource with all haste. I pay tribute to the current Minister's handling of this issue and support his unequivocal stand on the Shell to Sea evolving shopping list. Anyone with an interest in Ireland's sustainable energy future would support the Minister in getting the gas to the market.

While the rapid increase in prices was attributed to increasing fuel costs, an examination of the ESB's regulatory accounts indicates that other factors are equally significant. These include the considerable increase in the ESB's operating and maintenance costs over the period 2002-04 from €480 million to €799 million, an increase of almost 70% over two years. The regulator should have been more vigilant and not allowed these cost increases.

The other factor contributing to price increases is the rapid increase in profits within the ESB's monopoly business areas, the transmission and distribution of the public electricity supply, from €215 million to €235 million before interest in one calendar year. As it is now accepted the ESB's monopoly business will not be privatised in the foreseeable future, there is no economic argument for retaining profits at current levels. Electricity prices could be reduced by up to 10% in the near term if the Minister issued a direction to the CER to regulate these businesses on a not-for-profit basis. This would have the added advantage of forcing the ESB to address its acknowledged excessively high power station cost base and generate a more appropriate level of profits from the business areas open to competition. Whether the regulator has been appropriately prudent in permitting the rate of capital investment which he has permitted over recent years is questionable. The easiest way for the ESB to generate profits is to increase capital investment.

The two main energy providers, the ESB and Bord Gáis Éireann, by virtue of the State's historic investment and support, contain key infrastructural assets. Why have commercial rates of return criteria been applied to these assets? Would the country and the economy not be better served by the setting of a regulatory model which would ensure the ESB and Bord Gáis Éireann are capable of meeting all their third party debt service obligations and that they retain some of the funds for extending electricity and the gas grid where appropriate, thereby avoiding both companies making combined profits in excess of €400 million, part of which is paid back to the Exchequer? Reducing the rates of return awarded to Bord Gáis Éireann and the ESB would not impact on their ability to pay their third party debts or extend the gas grid, but would significantly reduce the cost of energy for industry. The management of both companies could be accused of operating as utilities in search of privatisation and this has resulted in unnecessarily high prices for consumers.

The Deloitte & Touche report found inefficiencies in operation and maintenance of the ESB generating plant gave rise to costs in the order of €100 million. These costs relate to availability of the plant, how regularly it can generate electricity and average wage costs. Inefficiencies at Poolbeg were particularly stark. There the report found 67% availability and an average wage cost of €122,000. It is no wonder €100 million could have been saved. Business as usual cannot continue to apply in our State energy monopolies.

I welcome the opportunity to speak on this motion. As electricity and gas consumers, we all know the CER has recently made its determinations on ESB and Bord Gáis Éireann end-user prices for 2007. Regrettably, gas bills have increased by 33.8% since 1 October while ESB bills will increase by 19.7% from 1 January. Understandably, the energy regulator has received many queries from customers and industry throughout the consultation period on these price increases. Many wondered whether falling international gas and oil prices would result in an immediate downward revision of ESB and Bord Gáis Éireann proposals for price increases.

We need to examine the reasons for the slow reaction to the recent downward trend with regard to end-user prices. In the case of Bord Gáis Éireann, almost 70% of the final price of gas is based on the wholesale price on international markets. Ireland is reliant on the UK for its gas and we import approximately 85% of the gas we use. Gas suppliers operate by buying their gas forward. This means they purchase gas now and during the summer for the coming winter based on the projected forward price. However, they do not take delivery of the gas until the winter. This policy guarantees delivery of the gas at a certain price, thereby avoiding the volatile spot market where prices could soar on a particular day.

During the summer and early autumn Bord Gáis Éireann would have forward purchased 90% to 95% of its gas needs for the winter, leaving only a small purchase element to the spot market. Therefore reductions in wholesale gas prices which were seen in recent weeks will only affect BGE for a very small amount of its needs. The ESB generates electricity from gas, oil and coal, all of which must be imported. The energy regulator has ensured that the ESB carried out a full assessment on the impact of current prices on its estimated fuel cost. The most recent analysis indicates that 2007 fuel costs, and as a result ESB prices, would not change substantially as a result of falling gas and oil prices. There would be a decrease of €9 million out of a total bill of €495 million for 2007. Falling gas and oil prices internationally would only have a marginal impact on the ESB's cost base for 2007. There are two main reasons for this. The price of coal has increased compared to the forward price assumed in the 2007 tariffs and now costs almost €71 per tonne. This increase largely outweighs the benefits of declining oil and gas prices.

The remaining outstanding fuel bill of €150 million from 2005 and 2006 must be recovered by the ESB. This deficit occurred as the price of fuels in each of these years increased beyond expectations. The ESB was unable to recover the additional cost as the tariff charged to customers was fixed for the full year, therefore a price lag built up. I understand that the energy regulator intends to fully track market fuel prices and the impact these have on the ESB and BGE cost base throughout the winter.

The energy regulator has decided to reopen a consultation on fuel price variation mechanisms in electricity tariffs. These mechanisms allow unit costs in tariffs to change in response to wholesale fuel market trends. This commitment follows a number of requests by industry consumers and the Oireachtas joint committee to examine fuel price variation. The commission will consult on this before the end of 2006 with the intention that any such clause would be introduced in spring 2007.

Negative politics is not my style. I believe in people working together for the common good. I absolutely accept the requirement for the Opposition parties to hold the Government to account. However, I would like to see them do it in a more constructive style. Will the Opposition categorically state that if in government it would reverse these increases?

Absolutely.

Surely it agrees that matters like this should not be subject to political or ministerial intervention.

Of course.

I do not believe for one moment that it is legitimate to accuse the Minister of hiding behind the regulator when what the Minister is doing is respecting the independence of the regulator. The Opposition is trying to have it both ways. Much damage can be done by this type of talk as was done with the rip-off Ireland campaign. It is simply not on to say that Ireland is an expensive country without also recognising the huge increase in earnings that has occurred. It is wrong to pretend that one can easily combine high earnings with low prices.

People spoke of the decline of manufacturing. Manufacturing is associated with lower costs and lower wage economies of which Ireland used to be one. Are people really suggesting that Ireland should reverse its transition to an advanced economy? If we were still a manufacturing economy the impact of energy price increases during the past three years would have been greater.

A second substantial structural change in the economy has taken place in recent years. This has involved a greater relative importance of services which are less energy intensive and a decline in the relative importance of traditional manufacturing sectors which are more energy intensive. This has reduced our dependence on oil. For example, oil imports in the late 1970s amounted to approximately 6.5% of GDP — the equivalent figure in 2004 was approximately 1.25%. Nonetheless it is important to develop new sources of energy. I congratulate the Minister, Deputy Noel Dempsey, on the new Green Paper on energy. On 1 October 2000 the Government launched a Green Paper entitled Towards a Sustainable Energy Future for Ireland, setting out policy proposals up to 2020. It sets ambitious targets for boosting Ireland's renewable energy. It calls for 30% of electricity consumed to come from renewable sources by 2020. This is an ambitious goal but one that can be reached.

During the past two years we have doubled the electricity produced from renewable sources and we are on track to have 15% of electricity consumed coming from renewable sources. The three pillars of our energy policy must be security, sustainability and competitiveness, all of which the Minister is doing his utmost to ensure.

I thank you, a Leas-Cheann Comhairle, for the opportunity to speak on this important issue. We all realise the volatility in energy prices is a problem through the EU as it is the largest importer and second largest consumer of energy in the world. Unfortunately, Ireland does not have a substantial indigenous resource like some other countries but depends on gas imported from the UK. More than 86% of our national requirement has to be imported and this is the major fuel used in power generation.

As a people we can contribute to using less by ensuring that energy demand is reduced through innovative energy efficiency measures. It would also help with security of supply and cost competitiveness. Better use of renewables brings greater diversity. Greater efficiency means lower demand and less dependence. Ireland has great potential in producing renewable energy especially by the harnessing of wind, ocean and bio-energy. That is the challenge.

The Government has a long-term strategy for biofuels and biomass which will deliver ambitious targets in the next ten to 12 years. I commend the Minister and the Government on supporting practical actions on the renewable side such as the comprehensive range of grant supports to develop greener homes, commercial bioheat and CHP units.

It is important to remember that the gas prices that came into force on 1 October 2006 will be fixed for one year, that is, until 30 September 2007. The Commission for Energy Regulation plans to review prices again during the summer of 2007. I have little doubt the Minister will ensure this is done. As in the case of gas, international fuel price is the major cost driver of electricity. The plant in Ireland is heavily reliant on fossil fuels. Some 90% of Ireland's electricity is generated by fossil fuel plants. It should be noted that the price of crude oil increased from $10 per barrel to more than $70 per barrel from 1997 to 2006. Some 70% of the price of electricity is made up of generation costs which are driven by fuel costs. Gas, oil and coal, all of which have to be imported, are used for generation. Forward prices for gas in 2007 increased by 40% compared to 2006 and oil prices increased by 36% which led to increased prices to the consumer. The Government has taken this into consideration especially for long-term social welfare recipients.

Under the national fuel scheme administered by the Minister for Social and Family Affairs, social welfare recipients receive a fuel allowance for 29 weeks of €14 per week and an additional €3.90 for the purchase of smokeless fuel. The Government recognises the hardship for the elderly in paying for fuel by providing this allowance. I have little doubt that in the forthcoming budget the Minister will again look favourably on another increase in this payment. The Minister has given his undivided attention to creating the conditions to keep energy price increases to a minimum, for which he should be commended.

I wish to share time with Deputies James Breen, Healy, Cowley, Gregory, Boyle and Ferris.

Is that agreed? Agreed.

It is timely that the high cost of energy is debated in the House given that electricity prices are increasing by approximately 20% and gas prices are increasing by approximately 33%. It is clear that the scale of the increases will have a major effect on our competitiveness and will have a great unwelcome impact on domestic users. There is no easy remedy to our difficulties but it is particularly baffling that prices are rising domestically while falling internationally.

In terms of electricity generation, wind farm owners often encounter difficulties in connecting to the national grid. What degree of control is possessed by the ESB and is the Minister satisfied the company is not abusing its dominant position or that obstacles are not being put in the way of smaller operators?

This energy debate is being held at a time when important announcements are being made on the provision of natural gas supplies to several towns in east County Galway. The decision to supply natural gas to the towns of Tuam, Headford, Craughwell and Athenry is welcome because an alternative source of energy offers a competitive advantage. In welcoming the decision, however, I must also set out the great need for a gas connection to Loughrea, Gort and Portumna. I understand that the latter towns will be considered by Bord Gáis under a phase two survey, which is welcome.

The speed at which the Minister moved to rubber stamp the price increases sought by ESB and Bord Gáis was staggering, given the snail's pace at which the Government has approached the development of renewable energy. Over the lifetime of the Government, electricity prices have risen by more than 60%. In September, an increase of one third in the price of gas was granted, based on the increase in the price of oil. However, since the summer, oil prices have dropped by approximately $18 per barrel. Why, then, does the Minister not insist on a commensurate reduction in the price of gas for consumers? The answer is simple — the VAT take on fuel has provided a major increase in funds which can be used to try to buy the electorate next year. The Progressive Democrats, who could give classes to the tail on how to wag the dog, want to make the ESB more attractive for privatisation. Higher prices mean more profits and a better selling price.

The real loser is, once again, the ordinary consumer. The high cost of living in this country will rise even further, with adverse effects on those who already struggle to make ends meet. The elderly are expected to survive on a miserly fuel allowance of €14 per week and low income families were already facing huge expenses prior to the latest increases. The job security of those who work in the manufacturing sector will be further jeopardised by the increased production costs faced by their employers, which will cause companies to move production overseas.

Given that the price of gas in our nearest neighbour is 25% lower than here, it would make economic sense for many companies to move to even cheaper locations. The Minister and the Commission for Energy Regulation should be more than mere signatories for price increases in the energy sector. They should be enforcing proper price structuring and fuel sourcing because, if garages on the side of the road can vary their prices from week to week, there is no reason decreases in costs cannot be passed to consumers on a quarterly basis.

I support the motion and believe the Government is hiding behind the CER on the matter. We have seen price increases of 25% in oil, 20% in electricity and 34% in gas at a time when energy prices are falling internationally. It has been claimed that the prices are affected because we are linked to Britain, yet the price of gas is 20% cheaper there and in the North of Ireland.

The Minister is hiding behind the regulator because the Government stands to benefit from a VAT bonanza. That money should be used to reduce the price of energy. The miserly fuel allowance of €14 per week for certain categories of social welfare recipients should be increased to at least €25, as recommended by St. Vincent de Paul, and payable over a 12 month period. This is particularly important for young families, given that 100,000 children live in poverty in this country.

That is a sensible suggestion from the Independent benches which should be in the budget.

The price of gas is increasing, while older people die of hyperthermia every winter. There is no doubt that more will die because of this increase.

According to surveys conducted by the Department and industry experts, oil and gas supplies worth hundreds of billions of euro are located off our coasts. When the Corrib gas comes ashore, it will not result in any reductions in the price of energy. We will pay the same price for that gas as we would for supplies from Russia or elsewhere. The opening of the longest pipeline in world, the Langeled pipeline from Norway to Britain, will mean that it will no longer be valid to argue that we need security of supply because there is plenty of gas to go around.

While there have been delays in bringing gas ashore, the price of a resource we have sold for a pittance is increasing continually. The supply of gas to towns in County Mayo, which I welcome, has overturned the argument for bringing Corrib gas ashore because the pipeline which was supposed to bring gas away from County Mayo can now supply the county instead.

While I am supporting this motion on the basis of its rejection of the recent decision to introduce significant increases in gas and electricity prices, I am amazed at the motion's failure to address all the implications of these increases. From meeting elderly people in my constituency and, in particular, those who live alone, I have become aware that the increases are causing great concern and hardship among older people. I concur with Deputy Cowley that the increases will ultimately cause deaths. The recent decision of the CER to grant price increases should be reversed. The Government should not hide behind the regulator because it is supposed to be running the country. Coming just as we enter the coldest period of the year, these increases represent cruel psychological, physical and financial blows to elderly people. This issue should focus our attention on the inadequacy of the fuel allowances and other supports for the elderly.

Yesterday, I attended a meeting of the forum for older people in the Stoneybatter area of the Dublin Central constituency, at which fuel costs were a priority issue. Many people pointed out that they need fuel allowances throughout the year and not only during the harshest months. Inadequate though it is, the allowance is cut off too soon, as the elderly will be the first to tell the Government if it is prepared to listen. The budget submission by the Irish Senior Citizens Parliament calls for the doubling of the current fuel allowance. I support this demand because of its importance to the well-being of vulnerable older people who are likely to suffer from hyperthermia if left exposed to the cold.

I am astonished this aspect of gas and electricity price increases did not receive a single mention in the Fine Gael motion. I am not surprised, however, that the issues of Shell's exploitation and the handover by our Government of our resources is not mentioned. The protection of the elderly must be our first priority.

This motion expresses an essential truth, namely that the Government has been negligent in anticipating the scale of the world energy crisis and has failed to devise policies to deal with its effects. Most particularly the Government has been negligent given that those who suffer most from these effects are those who have least. The ultimate responsibility for this indifference rests with a Government that treats environmental issues and issues of energy conservation with a distaste that belies anyone with any proper respect in public life.

Last weekend at the smugfest that was the Fianna Fáil Ard-Fheis, the Minister for the Environment, Heritage and Local Government referred to my party and its supporters as jihadists. If any people deserve the title of eco-terrorists it is those who have put in place policies that Nero-like seem to ignore that not only is Rome burning but also the planet itself is burning. Despite this, those most in need of heat and sustenance are those with least. For three years the Government failed to increase the social welfare fuel allowance and has a policy that believes the need for fuel allowances exists only in certain months rather than on a full-year basis. The Government has failed to introduce energy policies as has been done in Denmark which now provides 25% of its energy needs through wind power, while we are scrambling to reach 3%. The Government is full of incompetence and indifference. The people will suffer for that distaste for introducing proper policies.

It has produced 90,000 housing units in a year, practically none of which has any proper energy efficiency standards. The attitude seems to be to build them quick and get them up fast with no one caring what kind of standards people live in. Those who suffer most, the elderly, must not only live in houses that are badly insulated, but because of their income they must resort to buying the cheapest and least efficient fuels that have the most damaging environmental consequences. Yet the Government does nothing. Like Deputy Gregory, I am disappointed the motion does not go further. I appreciate it gives a platform for a wider debate, which is needed. It needs more than just three hours of Private Members' time in a given week. This is the essential international political issue that anyone in public life must seek to address in the next decade and beyond.

If we are serious about meeting the energy needs of current and future generations we must do so in a fair and just way. Currently this policy is determined by people outside our country who run multinational corporations and by nations whose interests are in the fossil fuel industry. If we, as an island nation that is 90% dependent on imported fuel for energy needs, are serious about breaking away from the shackles from which we can break away and starting to become somewhat self-sufficient in meeting our energy needs, we need a Government to introduce policies to address these needs. We need a Government that does not play along with the type of indifference we see. We certainly need Ministers unlike the Ministers for Communications, Marine and Natural Resources, and the Environment, Heritage and Local Government, who seem to believe the best form of policy formation is to attack other people in political life who do not make the political decisions or allocate the resources and are not responsible for the mess of our energy policy or the suffering of too many of our citizens who live in fuel poverty.

The reference in the Fine Gael motion to the need for review of the regulatory arrangements is appropriate given the reduction in global prices at a time when large increases in domestic charges have been approved. As I said at the time the approval of increases of more than one third in the price of gas and 20% in electricity will have a huge detrimental effect on many low-income householders.

The generally accepted measure for fuel poverty is any household that needs to spend more than 10% on heating its home. With the latest increases the number of people falling into that category will increase significantly. The average annual household gas bill before the latest increase was €1,260, which will rise to almost €1,700. Likewise the average electricity bill will increase from €740 to €890. Any household using both will have an overall bill of €2,590. Any household with a disposable income of less than €26,000 per year will technically experience fuel poverty. That is a frightening statistic when one considers that the pre-tax average industrial wage is only approximately €5,000 more.

A 2001 survey showed that more than 17%, almost 230,000 households, were experiencing some form of fuel poverty, which is considerably higher than comparative figures from other EU states. Given the large increase in prices since 2001, that figure will now be considerably higher. The survey also found that particular people were most vulnerable, including single people, a large proportion of whom are elderly. It is a catch-22 situation as elderly people and social welfare recipients are not only in receipt of incomes that make meeting energy costs difficult, but are also more housebound and therefore need to use extra heating systems to live.

Another group significantly affected are single parents with young dependent children. That such families spend much time at home is a major contributory factor. Ireland has significant variations in seasonal mortality, indicating a strong probability that many of those who die in the cold seasons do so because they do not keep themselves sufficiently warm. They do not keep themselves warm because they cannot afford to do so.

Another aspect of fuel poverty examined in the survey to which I refer and given prominence in a newspaper by John Healy and Peter Clinch from UCD was energy efficiency. The homes of lower-income families tend to be less well insulated and thus it costs more to keep them warm due to considerable energy loss or inefficiency. This could be tackled by altering the current grant structure for the installation of energy efficient and renewable energy systems into homes. Currently a relatively small number of people take up, for example, the greener homes grant. In my county, fewer than 600 people have been offered grants so far this year. The figure for the whole State is fewer than 7,000. To a large extent this is because even with the grant considerable cost is involved in installing the necessary equipment.

Currently approximately 270,000 people receive fuel allowance at a cost of €125 million. That figure is close to the number of households living in fuel poverty in 2001. Given the link between fuel poverty and energy efficiency, would it not make sense to make everybody in receipt of fuel allowance also eligible for a full grant to improve insulation if they wish to take part in the greener home system? While the cost would certainly be significant, it might well turn out to be cost effective and would reduce overall energy bills, reduce the consequences and hence the burden on the health service of correlated illnesses and make significant contributions to improving our position regarding renewable sources of energy and reducing energy waste.

I am delighted to have the opportunity to speak on this very important issue which affects the whole country and especially my area and that of the Minister who came here last night to shout down everything we tried to say in good faith. We have many businesses in County Meath and throughout the country that are really suffering from the cost of energy. They cannot take it anymore. They have been highlighting the issue for a number of years, but nobody is listening. The Minister has allowed the regulator to approve an increase and it is getting worse as the years go on. The country cannot afford these increases, which will put people out of business. Business people write to us every day telling us that if these energy costs continue they will not be able to compete on the European market, which will result in job losses at companies like Wellman International in Cavan, Tara Mines and Kepak. These businesses are under pressure. They employ our friends, relatives and the people we represent. There is no point in saying it is big business looking for more profits. It is not about profits. They are looking to survive and they need the Government to protect them against high costs, especially high energy costs.

Ireland has the highest energy costs in Europe. We have the highest wage and insurance costs, hidden taxes such as local authority charges and so on. We are being ripped off across the board and it is leaving our industries in an uncompetitive position. That cannot continue and jobs will be lost. Many companies are being asked by their parent companies abroad the reason they are still in Ireland when they cannot afford to remain there. The increase in energy costs for one of the companies I mentioned earlier will be €1 million this year. That is a massive increase for any company to take. To deal with some of the prices, energy costs are 20% higher in Ireland than anywhere in Europe. Gas prices are up 50% since 2003. Electricity prices are up 30% and diesel oil is up 40%. The Minister said last night that we are the ones preaching doom and gloom, but that is not the case. It is the businesses which are crying out for help.

The regulator gave his reasons for the increases in energy costs. The Minister said he cannot interfere in that but we must examine some facts. The forecast price for gas next year is 45.82 cent per therm as of 6 November. That is 11% lower than the forecast for 2006, a year ago. We are entitled to expect that the regulatory regime here is such that the 11% reduction in the cost of gas is reflected in prices charged next year to Irish customers for both gas and electricity, but that will not happen because there will not be a review until September next year. The Minister mentioned last night that there is hope of a mid-term review early next year — it is a little like the mid-term elections in America — but he cannot guarantee that will take place. The Minister has the power to make the regulator act now on prices. His contribution last night was all about the future. The future is important but we are in trouble now as regards energy costs and action must be taken now.

When the regulator released his papers on fuel costs variation and the ESB tariff increases, he cited increases in gas and oil prices as the key drivers behind the increases. Correctly, coal did not get a mention. The fuel cost variation he proposed was to be based on gas price movements only. In light of that, he cannot now claim an increase in coal prices as the reason for refusing to moderate next year's electricity tariffs. Coal fired generation in Ireland accounts for only 15% to 17% of total generation. Gas accounts for approximately 50% to 55%, with oil at approximately 20%. At the end of July, when the regulator was determining the gas costs assumption to use in setting next year's power changes, the future price of coal as quoted on the intercontinental exchange for December 2006 and January 2007 were $72.65 and $72.60 per tonne, respectively. They are now lower, not higher, as the regulator claims. On 3 November, these contracts settled at $68.50 per tonne.

It is possible that the regulator is comparing apples with oranges. Whether that is deliberate, cunning or merely disingenuous, it is misleading and is not helpful to industry.

The regulator's claim that next year's increase is justified by €151 million under-recovery on fuel costs for 2005 and 2006 is not substantiated and is probably false. The Minister has a duty to explain that to us because he has a say with the regulator. He can act this year and next year to ease the pain on our employers, the people we need to give employment in this country, and those who are paying rates through county councils.

To lecture us and say it is not our job to raise doom and gloom issues is wrong. It is our job. We are being asked to do it and it is vital that we do so if our communities are to continue with their current employment levels. It is not good enough to talk about what we will do in 2012 and 2020, having been ten years in government. We are constantly being told what the Government intends to do. I read the Minister's speech last night word for word and one would think he was not in government yet but that he was only about to start the job tomorrow.

Employers explain the problem to their employees, and employees now realise who is responsible for mucking up this issue. I will know who to blame if we lose jobs, and employers will know who to blame. It is on record. The facts are there for all to see. The costs are too high. We must reduce them and we can do so. The questions I have raised, and others I have not had time to raise, must be put to the regulator. Questions are not being answered and information is not correct. It is possible to reduce these tariffs. It is not acceptable that the price of energy is set once a year. There must be an opportunity for that to be reviewed and changed on a bimonthly or six monthly basis. An attempt at a review in 2007 is not good enough. People are trying to survive. They have businesses to run. They need to plan ahead but what will happen is an even greater exodus from this country by people looking for jobs.

I agree with Deputy English that the recent energy price increases are a national scandal. I have called for the resignation of the regulator and I do so again tonight. What does he regulate? Does the regulator understand how people in this country have to live? Does he hide behind the name of the regulator? Does he have any understanding of the way businesses must operate and how people have to try to make a living in this country?

When the regulator discovered that the price of oil in particular had come down, why was he not able to say that, while he had to increase the prices because the price of oil increased, he would now reduce them? We are now told he will have to review the position some time next year. If he has the power to put up prices, he should have the power to reduce them.

We are facing winter and people are faced with massive energy price hikes. People will not be able to heat their homes. The Minister for Social and Family Affairs, Deputy Brennan, told the poor people of this country that he would do something for them. He announced the increases that would come into effect from last year's budget. I hope that in the budget in December the super rich will not be looked after again and that the Minister for Social and Family Affairs will announce generous increases for people to cover the cost of fuel.

The fuel scheme operates for 29 weeks of the year. It was increased from 26 weeks but the allowance is not available throughout the year. It runs from October to April but not between April and October. Does the Government not know we have bad weather in this country most of the time? People need to have a fire going in their homes all the time.

It is a disgrace that the regulator did not see fit to protect the poorest in society. It is the first time since I came into politics that I have been contacted by business people, employers and people involved in industry who told me they will no longer be able to compete here, that their jobs are at risk because of these recent increases.

We increased prices for the ESB. The ESB, like many more companies in this country, has a box in Croke Park — I do know if the Minister of State ever attended one — which it can fill without difficulty. It can wine, dine and look after the rich, yet when it has to make a cut-back it runs to the regulator and the regulator crucifies the small, the weak and the sick with fuel increases. That is a disgrace.

I could not speak tonight without mentioning the announcement made last week on gas. I welcome the fact that towns in my county got the connection, but to me it is the greatest scandal. If Guinness was produced in Dublin and sold throughout the world but was not available in Dublin, there would be an outcry. We have a situation where gas will be piped out of Erris, will pass Belmullet and continue to Crossmolina, yet the people of Erris, from where the gas will be piped, will not be connected to the pipeline. They could not connect Ballinrobe, Swinford or Kiltimagh, but a few constituencies in Galway represented by Ministers were able to get it. It will go to the midlands in Tullamore. It was economical to connect it there but it was not viable to supply the county from where the gas was being piped.

It is time the Government woke up. The people of this country have had enough. I want to see that decision by the Minister reversed. I want the gas to be supplied to Belmullet and proper infrastructure in terms of roads, sewerage and water schemes provided in Erris, particularly now that natural gas from there will supply 80% of our economic needs for many years to come. I am sure with the gas there will be oil and it would be wrong to steal that natural resource from Erris. All the people of Erris will get is trouble. They have to take the risks and it would be a disgrace if the people of Erris did not gain from that. I call on the Government to rethink that decision immediately.

The regulator sees fit to protect the ESB regarding charges. For many years taxpayers paid for the infrastructure of the ESB so it could get up and running. When one receives one's electricity bill every month and sees all the listed charges, one notes that the actual electricity charge is not too bad. It is all the extra charges that cause trouble. The Government is cleaning up on VAT and we have to pay some old surcharge and another to be connected to the network.

When a poor person in a rural area wants to get an ESB pole moved from his land because it is obstructing him, the ESB quotes a price for its removal off the top of its head. It could amount to €25,000, €16,000 or €7,000. Who put the infrastructure in place only the hard-working taxpayer? Why should the ESB be allowed to behave in this way?

The regulator should not always be heeding big business. We were told there would be competition in our market, lower electricity costs and that the consumer would be protected. However, the consumer is not being protected. He is being ripped off. There will be many job losses over the coming months owing to the recent increases and they represent a step too far for industry and the employers. People must be protected.

An hour or two ago in my constituency there was a major accident resulting in the death of three young people. I offer my sympathy to their families. The deaths are bad news for the families and the coming days will be a tragic time in Ballinrobe and the county.

I compliment Deputy Durkan on tabling this motion. Much has been said over the past two nights about the future of energy prices. To put it simplistically, there are certain things in this country that we cannot change, such as the fact that we do not and will never have oil wells. We must all accept this. It is awfully hard to bring in the bit of gas we have. I do not blame the Government for what we cannot change, and nobody else is doing so. This is not where the problem lies.

Given the great increase in the use of oil for industry and transport throughout the world, we know the oil wells cannot keep pumping forever. I have no idea when the oil will run out — every expert has his own view — but we know Ireland has many resources that many countries would give their left hand for. Until very recently, there was hardly a word about them. I have not time to discuss them in detail because I want to deal with a more central issue. Suffice it to say, simplistically, that we did not tackle wind or wave energy to any great degree and we certainly failed to encourage the growth of any crop that might produce oil. I have seen crops used for this purpose 20 years ago and there is nothing new about doing so. The economics of growing them can be difficult under certain circumstances, but we must ensure we use our available natural resources to create energy or fuel. This is a broad-brush approach.

Let me discuss the factors within our remit. This subject follows on what Deputy English and others have been speaking about. I may not be an expert on the world oil market and I am not sure many are, because they all seem to get it wrong on occasion. When the regulator made its decision, or slightly before it did so, I was foolish enough to believe it assumed the price would plateau at approximately $70 to $80 per barrel. I believed its decision was predicated on this assumption and could not see any other reason for the remarkable increase in fuel prices. When the regulator's office was established, I genuinely believed it would be very independent, and I have no reason to believe otherwise, but I believe it was assumed at the time of establishment that there would be a steady increase in oil prices, as we were used to over the years. This did not happen.

The whole country held its collective breath on the morning the decision was made. The issue was well flagged before the regulator announced it. When the 20% increase in the price of electricity for domestic consumers, the increase in the price for commercial consumers and the 34% increase in the price of gas were announced, I remember saying to myself the country was in for a terrible time. It is very difficult to sustain such increases. Naturally, on hearing the decision, I examined the increases in other countries. We are a good bit ahead of them at this stage and that is where the problem lies. This is where our anti-competitive aspect kicks in. It would be acceptable if every other country were subject to similar increases because we must compete with them on the foreign market, but they have not had such increases. If we had no control over this, I would have nothing to say about the matter because I am as realistic as the next person. One must pay the commercial rate that obtains in the rest of the world.

Yesterday, on Tuesday, 7 November at 3.15 p.m., I saw fit to check the Internet for the price of Brent crude oil in dollars per barrel. I assume the figure I obtained, namely, $55.21 per barrel, is as official as one can get. This is a base price and prices all over the world are relative to it, although there are some jigs and reels to be danced around it. If it was $75 per barrel, there would be a different reaction all over the world.

I had always understood that when dramatic changes took place in the energy market, the regulator was entitled to reconsider existing prices. The Government might argue, as it does in respect of the HSE and other bodies, that it has nothing to do with the decisions of the regulator, but this is not acceptable. Energy prices comprise a vital national issue and no other issue will take centre stage in the next ten years. Energy prices are central to our competitiveness and if we do not get them right we will be in serious trouble.

I met a lady yesterday who received a bill of €60 from the gas company. Admittedly, it was not a very large bill. When she examined it, she noticed that €48 of the €60 was accounted for by VAT and other charges. She used just €12 of gas, but she was charged €60. We cannot continue to fleece the people of Ireland in such a manner.

The Deputy should conclude.

I am sorry because I was only getting good.

The Deputy was warming up.

I am pleased to have an opportunity to speak on this strategically important issue. Energy underlines all areas of economic activity and is vital for the well-being of our people. The Government, unlike the Opposition, has responsibilities. Its task is to ensure that energy is affordable, consistently available and secure in supply. The Opposition has no policies on this issue. It is able to face in two ways at the same time.

We are leading the Government.

At least we are not facing backwards.

We have more policies than the Government, which has been in power for ten years.

The Opposition does not want an independent regulator for energy. It wants the Oireachtas to have the power to intervene to reduce gas and electricity tariffs. Its energy policy, which was published last April, calls for the appointment of a transport regulator without any restrictions.

The Minister of State does not even believe that.

The Opposition, which is living in cloud-cuckoo land, wants to intervene in the market, to generate instability and uncertainty and to drive away new entrants.

This a carbon copy of what we heard last night.

That would diminish competition, which the Opposition says it wants to champion. Investors will give a wide berth to any market that has such regulatory uncertainty.

They will not.

It is as if volatility in energy prices is occurring on the island of Ireland and nowhere else in Europe. We should examine the facts. Gas is an internationally traded commodity. Ireland is essentially a price taker. Bord Gáis Éireann imports over 86% of the gas used in this country, the cost of which has increased by approximately 50% in the last year. International fuel prices are the major drivers of the cost of electricity, just as they are in the case of gas. Some 90% of our electricity is generated by fossil fuel plants. The price of oil increased from $10 per barrel to over $70 per barrel between 1997 and 2005. The increase in gas tariffs is not unique to Ireland. Some of the largest gas suppliers in the UK have faced price increases ranging from 24.4% to 34.6% in 2006. As I speak, gas is 7% more expensive in the North than it is here. The price of gas has increased by 74% in Northern Ireland since September 2005. The price of gas here has increased by 67% in the same time.

Electricity is currently 8% more expensive in the North than it is here. Last April, there was an increase of 10.8% in the price of electricity in the North. Almost 70% of the price of electricity is accounted for by generation costs. With the exception of some peat, all fuels are imported. A programme of investment in improvements in the electricity network is under way, at a cost of €2.8 billion, and will last until 2010. Does the Opposition want a Third World network for a First World economy?

We want jobs.

Household electricity bills in Ireland are just over 1% higher than those in Britain, on average.

We do not want high prices.

The six largest electricity suppliers in the UK have increased prices throughout 2006 by between 13.1% and 39.6%.

The higher the prices, the more money for the Government.

The equivalent figure for the ESB was 4.11% in 2006. The UK has an abundance of generating plants, nuclear power plants, significant interconnection facilities and a large open and contestable market with privatised energy utilities——

We have to compete with the UK.

——but it continues to experience very high prices.

That does not explain our high prices. The Minister of State should deal with the issue before the House.

The Commission for Energy Regulation has made every effort to ensure that electricity price increases have been kept as low as possible. It reduced the revenue sought by the ESB by €80 million, or 3.5%. It has considered the possible fuel cost variation mechanisms in tariffs.

The Government raided the ESB.

Value added tax is set at 13.5%.

It grabbed €70 million.

A reduced rate applies to electricity and all forms of heating fuels. This rate is well below the rates applied to such products in the vast majority of EU member states. VAT is reclaimable for business.

I would like to speak about pensioners and those on fixed incomes. That this is a caring Government is underlined by the generous level of support it has made available, in the form of social welfare payments, in the various budgets over its lifetime. The ESB and Bord Gáis have schemes in place to help vulnerable customers. The service will not be withdrawn if an agreed payment plan is in place. Under the national fuel scheme, various fuel allowances are available to welfare recipients and concessions are available to pensioners. A generous grant aid scheme of up to €27 million is available for domestic renewable heat technologies and Sustainable Energy Ireland's low-income housing programme to improve the energy efficiency and comfort of homes occupied by low-income households. Funding is also available for forms of energy efficiency including attic insulation, draught-proofing, hot water cylinders and cavity wall insulation.

I commend the amendment to the motion to the House on behalf of the Government, which is pursuing the development of a dynamic energy policy, in contrast to the Opposition, which is bereft of ideas about how to cope with volatile international energy markets.

Hear, hear.

If the Minister of State has a spare hour, I will tell him about our ideas.

This is the same rubbish.

It will not be able to handle the energy supplies of this island, which is essentially a price taker.

If the Government keeps coping the way it is at present, there will be trouble.

I await with interest further details of the commitment given by Deputy Durkan tonight. In response to a Deputy on this side of the House, he said that when Fine Gael gets into office, he will reverse the increases recently sanctioned by the regulator. If I were a betting man, I would bet that will not happen.

Who is preaching doom and gloom now?

It is unlikely that Deputy Durkan will ever get to be on this side of the House. I can assure Deputy Ring that I have never been in the ESB box in Croke Park. Perhaps the Wexford teams do not play there that often.

Unlike Mayo.

I have never been invited by the ESB to sit in its box and I do not want to be invited. Like Deputies on all sides of the House, I would prefer to sit among the rank of file of my home county.

Hear, hear.

Many people cannot afford to go to Croke Park because they have no jobs, as a result of the high energy costs.

Over 15,000 jobs are being created each year.

I thank all the Members who contributed to this debate. I tabled this motion to try to get answers to two vital questions. Was the Government awake to what was happening on the international markets?

We are always awake.

Was the Government prepared to pass on the benefits of what was happening on the international markets to consumers?

The answer to both questions is "Yes".

That is the interesting part of it. All the evidence suggests that the Government is impervious to the needs of consumers, including householders, factory owners and shopkeepers. Every house, factory and office in this country is affected by energy prices in one way or another. Employment is affected by energy prices. Even though many jobs have been lost from this country to more competitive parts of the world in recent years, the Government has remained inactive. Its representatives have muttered and mooched around the subject of the impartiality and independence of the regulator, which is amazing. It seems that the regulator is now sacrosanct and the Government is no longer effective or active.

The Opposition supported the establishment of the regulator.

It can do nothing about it. It does not want to do anything about it because it suits the Government to have high energy prices.

That is untrue.

I will give the House an idea of how the Government gains. In the last couple of years, the Government has claimed to be very concerned about everybody.

It is a caring and sharing Government.

It says it is people-friendly and concerned about the poor. It claims to be concerned about investment in industry, but I will tell the House what it has done to the ESB. In 2002, it took €39.7 million from the ESB and stuck it in its pocket. It hammered the ESB with that particular burden.

The Government put the dividend into its pockets so that it would have more money to spend on goodies in the election of that year.

In 2003, the same Government went back to the ESB, claiming to be concerned about energy costs. On that occasion, it took €67 million and stuck it in its pocket again.

We gave it to the people.

In 2004, it came back and took a further €77 million from the ESB. Its Deputies have the neck to come to this House and start prancing around and talking about its energy policy. The Government does not have an energy policy.

That is untrue.

It is totally bereft of policy in that area.

Did the Deputy read the Green Paper that was published a few weeks ago?

The only thing that Government Deputies are doing is reading glossy magazines which tell them that energy prices will be at a certain level in 100 years' time. They will not be here then. Indeed, they will not be in government for much longer, fortunately. If the Government stays in office much longer and continues to act as it is at present, many consumers——

We will be here for a long time.

The Minister of State might be there, but many consumers will have to leave.

The Government is for the chop.

The Deputies opposite are not reading the polls.

All they have is hope.

They are engaging in wishful thinking.

In 2005, the Government returned to the ESB once more, despite all the chat we have heard about energy policies. The Government is part and parcel of the process that creates high energy prices.

That is not true.

Of course it is true.

It took €72 million from the ESB in 2005. In the last four years, it has taken €260 million from the ESB and stuck it in its pocket. It will spend that money in the budget to buy votes from the electorate.

We do not buy votes.

That money goes back. It is the people's money — it is not the Government's money.

As if that blunt instrument was not sufficient to assuage the voracious appetite of the Government, it will have taken €316 million more by the end of the year than it would have got if the increases had not taken place.

That is shameful.

I have seen many crocodile tears shed in the past two nights and I must say the Government Members should get an academy award for acting as they are capable of doing nothing else.

The Deputy is not bad at it himself.

They are a disgrace because they have ignored the fact the Irish consumer is as much entitled to get the benefits of the international downturn in energy prices as anybody else.

Hear, hear.

They are obviously incapable of reading. For the benefit of those who cannot read, I will show them a graph I have.

That's the problem with Fine Gael. They do not know anything about the people.

Ireland's prices are on the graph and I hope those who have difficulty reading will not be shocked if I show the graph again. The graph shows what the Government is charging the Irish people and what it is imposing on the Irish people.

They do not want to read it.

The sad thing is that if the Government survives for another five years——

We will.

——I assure the House that industry and the consumer will have a huge bill to pay as a result of what the Government is doing. The Government wants to drive up energy prices, bring in more money in VAT, levies and dividends from the ESB and walk away. However, the electorate may yet have something to say about that.

The Minister decried the fact that Fine Gael did not want to become involved in an all-party consensus on energy. If we had any doubt about what he had in mind, we know now. We were not foolish enough to become part of an all-party consensus on high energy prices. We do not wish to hound the housewife and the industrialist, or to beat them over the head with an all-party consensus. It was the greatest con job of all time. The Government had it well planned in advance and it must have had the think tanks working overtime. Condensation must have been pouring out of the heads of Government Deputies by the time they came up with that particular consensus. They should be ashamed of it because it does not do justice to their cleverness at all. They should have come up with something much more subtle than that. If they had been given time, they would have done so. They should be given time on the Opposition benches. They could examine their consciences and ask themselves a few serious questions about what they had in mind.

Before they throw themselves on their swords——

We do not do that.

Fine Gael produced an energy policy independently long before the Government had the guts to do it. We costed it and priced it, but the Government did not intend to do that because it was afraid to do so. It was afraid to produce a White Paper so it came up with a different Green Paper, because Government Deputies did not have the guts to go to the public and state their case.

They spoke about security of supply, but I know what they are up to. If energy prices are driven up enough, everybody will say that soon there will be no energy and that if we do not pay more for it we will not be allowed to breathe.

International prices drive domestic prices up.

It is a good job they are not allowed to control the air in the same way they can control the fuel.

There is only one way to have a proper competitive energy policy in this country that would be of benefit to the economy. We must invest in the alternative energy area to such an extent that it is grown quickly. The Government promised to do it and it is a wonder we have not been told it will be done before the next general election, because there is no chance of that now.

The Deputy is going well. We want to hear more from him.

The Government is part and parcel of a litany of failures, such as failure to recognise, failure to hear the words of the people, failure to respond to the needs of the people and failure to take action when it could and should. We all know that the Minister can influence the regulator and that the regulator consulted with the Minister before he acted. He did not do that on his own; he got full approval. We have listened to Government backbenchers telling us why it was important to have high energy prices. They should tell that to the housewives and investors in this country.

The regulator is independent and Fine Gael supported us a few years ago.

This represents a number of failures. It represents the failure of the regulatory system to respond to the ongoing needs of the international market trends. It is a failure of the Minister to instruct——

The regulator is independent.

The Minister has a say over it.

He is subject to the Government's policy and the Minister's instructions. Either the Minister instructed and the regulator told him to clear off, or the Minister failed to instruct and the regulator rang him up and asked the Minister for his instructions and then claimed he was independent. As long as the Minister remained silent, the regulator could do what he had to do. This is a burden on the taxpayer, the consumer and on industry and it is a failure on the Minister's part.

The Deputy is burning a lot of energy.

The Minister failed to recognise trends. He failed to recognise the importance of the decision and the impact it is likely to have on the consumer. He failed to reduce the threat to industry and jobs because he did not address them. The Government, with the full approval of the Minister, has given backing to ripping off the Irish consumer, industry and the economy. It has done so willfully in the run-up to a general election in a disgraceful way for which it should be thoroughly ashamed.

Deputies

Hear, hear.

I thank all Deputies who contributed to the debate on this Fine Gael motion, which has called for a review of the regulatory arrangements that apply to the cost of energy and to the huge price increases in gas and electricity, and which seeks to allow the Oireachtas to call on the regulator to initiate a review at any time that the Oireachtas so decides.

Householders and consumers who are affected by the man who comes down the chimney at Christmas time can now expect to find some other things dropping through the letter box, such as increased ESB and gas bills. This is now a high-cost country and it is becoming increasingly uncompetitive for big manufacturers that use a lot of energy. Last week I highlighted a case involving a major employer, with 1,000 employees, whose ESB bill will rise by €800,000 in the next 12 months. At the same time, that company was able to sign an agreement for oil for the next 12 months at 22% below the cost price of six weeks ago, as these things are predicated by the world market. A major multinational company cannot pass on that increase to its customers. If this continues, American business will deal with that by walking away. When one considers that industry in Malaysia or Indonesia can employ ten times the number of workers in Ireland for the equivalent of the same wages, then energy cost increases spell out a very serious challenge for the Government. It creates great difficulty for manufacturers and employers.

Everyone obviously knows that energy issues and the green agenda have become mainstream, and one wonders whether the Democratic victory in the congressional elections will force a re-examination of US attitudes to the Kyoto Protocol. It remains to be seen what will happen regarding Japanese, Chinese and Far Eastern problems. However, to put it in an Irish context, there are the double pipeline coming in on the east coast, Kinsale Head feeding in on the south coast and another pipeline to come in from the Corrib field, which I hope can be harvested in accordance with the highest standards of safety, integrity and environmental care, with no disregard for human life. There is also a company that wishes to build a liquid natural gas facility in the mid-west, something that may happen within the next ten to 15 years.

That gives this country energy options, but the regulatory regime to which Deputy Durkan's motion refers requires far more transparency and a greater flow of information so that small and medium-sized enterprises, larger businesses and consumers can understand what fluctuations in world oil and gas prices we face. As the Minister of State, Deputy Browne, will be aware, liquid natural gas facilities have now created what one might term "mobile pipelines", in that carriers can now transport frozen liquefied gas all over the world. In that sense, other countries have moved far ahead of Ireland.

Speaker after speaker highlighted the severity of increased gas and electricity charges, which will place a great burden on households this winter and for the coming session. What the motion in Deputy Durkan's name calls for is very clear. As an interim measure, we must provide that the Oireachtas compel the regulator to instigate a review of prices at an appropriate time, if that be deemed necessary, and a full review of regulatory regimes. That is in the country's interest, since as surely as the Minister has responsibility for the matter, the industries that I mentioned are extremely concerned at their bottom line, which is being put under serious pressure by such massive increases in gas and electricity prices at a time when it is available much more cheaply or even given away in other parts of the world.

Amendment put.
The Dáil divided: Tá, 69; Níl, 55.

  • Ahern, Noel.
  • Andrews, Barry.
  • Ardagh, Seán.
  • Blaney, Niall.
  • Brady, Johnny.
  • Brady, Martin.
  • Brennan, Seamus.
  • Browne, John.
  • Callanan, Joe.
  • Callely, Ivor.
  • Carey, Pat.
  • Carty, John.
  • Cassidy, Donie.
  • Collins, Michael.
  • Cooper-Flynn, Beverley.
  • Coughlan, Mary.
  • Cregan, John.
  • Cullen, Martin.
  • Curran, John.
  • Davern, Noel.
  • de Valera, Síle.
  • Dempsey, Tony.
  • Dennehy, John.
  • Devins, Jimmy.
  • Ellis, John.
  • Fahey, Frank.
  • Finneran, Michael.
  • Fitzpatrick, Dermot.
  • Fleming, Seán.
  • Grealish, Noel.
  • Healy-Rae, Jackie.
  • Hoctor, Máire.
  • Jacob, Joe.
  • Keaveney, Cecilia.
  • Kelleher, Billy.
  • Kelly, Peter.
  • Killeen, Tony.
  • Kirk, Seamus.
  • Kitt, Tom.
  • Lenihan, Brian.
  • Lenihan, Conor.
  • McEllistrim, Thomas.
  • McGuinness, John.
  • Martin, Micheál.
  • Moloney, John.
  • Moynihan, Donal.
  • Moynihan, Michael.
  • Mulcahy, Michael.
  • Ó Cuív, Éamon.
  • Ó Fearghaíl, Seán.
  • O’Connor, Charlie.
  • O’Dea, Willie.
  • O’Donnell, Liz.
  • O’Donovan, Denis.
  • O’Flynn, Noel.
  • O’Keeffe, Batt.
  • O’Keeffe, Ned.
  • O’Malley, Fiona.
  • Parlon, Tom.
  • Power, Peter.
  • Power, Seán.
  • Roche, Dick.
  • Smith, Brendan.
  • Smith, Michael.
  • Wallace, Mary.
  • Walsh, Joe.
  • Wilkinson, Ollie.
  • Woods, Michael.
  • Wright, G. V.

Níl

  • Allen, Bernard.
  • Boyle, Dan.
  • Breen, James.
  • Breen, Pat.
  • Bruton, Richard.
  • Connaughton, Paul.
  • Connolly, Paudge.
  • Costello, Joe.
  • Crawford, Seymour.
  • Crowe, Seán.
  • Deasy, John.
  • Deenihan, Jimmy.
  • Durkan, Bernard J.
  • English, Damien.
  • Enright, Olwyn.
  • Ferris, Martin.
  • Gilmore, Eamon.
  • Gogarty, Paul.
  • Gormley, John.
  • Gregory, Tony.
  • Hayes, Tom.
  • Healy, Seamus.
  • Higgins, Joe.
  • Higgins, Michael D.
  • Hogan, Phil.
  • Howlin, Brendan.
  • Kehoe, Paul.
  • Kenny, Enda.
  • Lynch, Kathleen.
  • McCormack, Pádraic.
  • McGrath, Finian.
  • McGrath, Paul.
  • McHugh, Paddy.
  • McManus, Liz.
  • Mitchell, Olivia.
  • Moynihan-Cronin, Breeda.
  • Murphy, Catherine.
  • Naughten, Denis.
  • Neville, Dan.
  • Noonan, Michael.
  • Ó Caoláin, Caoimhghín.
  • O’Dowd, Fergus.
  • O’Keeffe, Jim.
  • O’Shea, Brian.
  • Pattison, Seamus.
  • Perry, John.
  • Quinn, Ruairí.
  • Rabbitte, Pat.
  • Ring, Michael.
  • Sherlock, Joe.
  • Stagg, Emmet.
  • Stanton, David.
  • Timmins, Billy.
  • Twomey, Liam.
  • Upton, Mary.
Tellers: Tá, Deputies Kitt and Kelleher; Níl, Deputies Kehoe and Stagg.
Amendment agreed to.
Question put: "That the motion, as amended, be agreed to."
The Dáil divided by electronic means.

As a teller, under Standing Order 69, I propose that the vote be taken by other than electronic means.

As Deputy Kehoe is a Whip, under Standing Order 69 he is entitled to call a vote through the lobby.

Question again put: "That the motion, as amended, be agreed to."
The Dáil divided: Tá, 69; Níl, 53.

  • Ahern, Noel.
  • Andrews, Barry.
  • Ardagh, Seán.
  • Blaney, Niall.
  • Brady, Johnny.
  • Brady, Martin.
  • Brennan, Seamus.
  • Browne, John.
  • Callanan, Joe.
  • Callely, Ivor.
  • Carey, Pat.
  • Carty, John.
  • Cassidy, Donie.
  • Collins, Michael.
  • Cooper-Flynn, Beverley.
  • Coughlan, Mary.
  • Cregan, John.
  • Cullen, Martin.
  • Curran, John.
  • de Valera, Síle.
  • Dempsey, Noel.
  • Dempsey, Tony.
  • Dennehy, John.
  • Devins, Jimmy.
  • Ellis, John.
  • Fahey, Frank.
  • Finneran, Michael.
  • Fitzpatrick, Dermot.
  • Fleming, Seán.
  • Grealish, Noel.
  • Healy-Rae, Jackie.
  • Hoctor, Máire.
  • Jacob, Joe.
  • Keaveney, Cecilia.
  • Kelleher, Billy.
  • Kelly, Peter.
  • Killeen, Tony.
  • Kirk, Seamus.
  • Kitt, Tom.
  • Lenihan, Brian.
  • Lenihan, Conor.
  • McEllistrim, Thomas.
  • McGuinness, John.
  • Martin, Micheál.
  • Moloney, John.
  • Moynihan, Donal.
  • Moynihan, Michael.
  • Mulcahy, Michael.
  • Ó Cuív, Éamon.
  • Ó Fearghaíl, Seán.
  • O’Connor, Charlie.
  • O’Dea, Willie.
  • O’Donnell, Liz.
  • O’Donovan, Denis.
  • O’Flynn, Noel.
  • O’Keeffe, Batt.
  • O’Keeffe, Ned.
  • O’Malley, Fiona.
  • Parlon, Tom.
  • Power, Peter.
  • Power, Seán.
  • Roche, Dick.
  • Smith, Brendan.
  • Smith, Michael.
  • Wallace, Mary.
  • Walsh, Joe.
  • Wilkinson, Ollie.
  • Woods, Michael.
  • Wright, G. V.

Níl

  • Allen, Bernard.
  • Boyle, Dan.
  • Breen, James.
  • Breen, Pat.
  • Bruton, Richard.
  • Connaughton, Paul.
  • Connolly, Paudge.
  • Costello, Joe.
  • Crawford, Seymour.
  • Crowe, Seán.
  • Deasy, John.
  • Deenihan, Jimmy.
  • Durkan, Bernard J.
  • English, Damien.
  • Enright, Olwyn.
  • Ferris, Martin.
  • Gilmore, Eamon.
  • Gogarty, Paul.
  • Gormley, John.
  • Gregory, Tony.
  • Hayes, Tom.
  • Healy, Seamus.
  • Higgins, Joe.
  • Higgins, Michael D.
  • Hogan, Phil.
  • Howlin, Brendan.
  • Kehoe, Paul.
  • Kenny, Enda.
  • Lynch, Kathleen.
  • McCormack, Pádraic.
  • McGrath, Finian.
  • McGrath, Paul.
  • McHugh, Paddy.
  • McManus, Liz.
  • Mitchell, Olivia.
  • Moynihan-Cronin, Breeda.
  • Murphy, Catherine.
  • Naughten, Denis.
  • Neville, Dan.
  • Noonan, Michael.
  • Ó Caoláin, Caoimhghín.
  • O’Dowd, Fergus.
  • O’Shea, Brian.
  • Pattison, Seamus.
  • Perry, John.
  • Quinn, Ruairí.
  • Rabbitte, Pat.
  • Ring, Michael.
  • Stagg, Emmet.
  • Stanton, David.
  • Timmins, Billy.
  • Twomey, Liam.
  • Upton, Mary.
Tellers: Tá, Deputies Kelleher and Kitt; Níl, Deputies Kehoe and Stagg.
Question declared carried.