Seanad amendments Nos. 1 to 3, inclusive, 5, 11 and 13 are related and will be discussed together.
Energy (Windfall Gains in the Energy Sector) (Cap on Market Revenues) Bill 2023: From the Seanad
The Dáil went into Committee to consider amendments from the Seanad.
Seanad amendment No. 1:
Section 2: In page 6, between lines 4 and 5, to insert the following:
“ “affiliated person” means—
(a) in relation to a company formed and registered under the Companies Act 2014 or an existing company within the meaning of that Act—
(i) any parent company or any wholly owned subsidiary company of the company, or any company that is part of a group of companies with that
company within the meaning of section 8 of the Companies Act 2014, or
(ii) the spouse or any relative, or the spouse of any relative, of a director, manager, secretary or other officer of the company,
and
(b) in relation to an individual—
(i) a relative of the individual,
(ii) a person acting on behalf of the individual or of a relative of the individual,
(iii) a company or other body of which the individual or relative of the individual, or a nominee of them, is a member,
(iv) a partnership in which the individual or a relative of the individual is a partner, or
(v) an employer of the individual, or of a relative of the individual;”
The amendments in this group are minor technical amendments which have been identified to provide greater clarity and reduce uncertainty for stakeholders and for affected parties. Amendments Nos. 1 and 3 result in moving the definition of "affiliated person" from section 14 to section 1. There is also additional text provided, which results in a more comprehensive definition and provides greater clarity.
Amendment No. 2 is a clarification that export-only suppliers are a particular case of generators and not all de minimis units fit within that definition. It also makes the distinction that they are not an intermediary or a trader. These amendments will reduce confusion for stakeholders.
Seanad amendment agreed to.
Seanad amendment No. 2:
Section 2: In page 6, to delete lines 22 to 25 and substitute the following:
“ “export only supplier” means a market participant—
(a) who does not sell electricity to wholesale customers (within the meaning of the Act of 1999) or final customers,
(b) is licensed to supply electricity under section 14(1)(b) of the Act of 1999, and
(c) who supplies electricity on behalf of more than one producer, each of which producer has a generating unit with installed capacity of less than 10 megawatts;”
Seanad amendment agreed to.
Seanad amendment No.3:
Section 2: In page 7, between lines 22 and 23, to insert the following:
“ “relative” means, in relation to an individual, a child, step-child, parent, brother, sister, spouse, civil partner within the meaning of section 3 of the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010, cohabitant, within the meaning of section 172(1) of that Act of 2010, grandparent, or grandchild of the individual or a child of the individual’s civil partner or cohabitant;”.
Seanad amendment agreed to.
Seanad amendments Nos. 4 and 6 to 10, inclusive, are related and will be discussed together.
Seanad amendment No.4:
Section In page 13, line 30, to delete “loss-adjusted metered” and substitute “relevant”.
This set of amendments features minor changes of a technical nature that my Department, with the assistance of the CRU, has assessed as being necessary to prevent the over-recovery of funds due to the unintended double-counting of moneys owed to the market cap fund. The issue of over-recovery only recently came to light during the consultation process the CRU carried out with industry. These amendments solve the problem in the methodology which resulted in double-counting. They are also drafted to ensure compliance with Article 6(3) of the Council regulation (EU) 2022/1854 and to prevent any circumvention by companies on their obligations to comply with the measure.
Amendment No. 4 provides a more appropriate unit of measure and greater clarity to companies that will be providing data on their activities in the return.
Seanad amendment agreed to.
Seanad amendment No. 5:
Section 6: In page 15, line 14, to delete “megawatts” and substitute “megawatt hours”.
Seanad amendment agreed to.
Seanad amendment No. 6:
Section 8: In page 16, line 27, after “deducted,” to insert “and”.
Seanad amendment agreed to.
Seanad amendment No.7:
Section 12: In page 16, to delete lines 28 and 29 and substitute the following:
“(iv) any monies liable to be paid by the producer to a trader who is not, in relation to the producer, an affiliated person shall be deducted;”.
Seanad amendment agreed to.
Seanad amendment No. 8:
Section 12: In page 16, to delete lines 37 and 38, and in page 17, to delete lines 1 and 2 and substitute the following:
“(iv) any monies liable to be paid by the intermediary to—
(I) a trader who is not, in relation to the intermediary, an affiliated person, or
(II) a producer who is not, in relation to the intermediary, an affiliated person,
shall be deducted, and
(v) any monies which exceed the intermediary’s monthly capped revenue and which are liable to be paid by the intermediary to a producer who is, in relation to the intermediary, an affiliated person shall be deducted;”.
Seanad amendment agreed to.
Seanad amendment No. 9:
Section 12: In page 17, line 11, to delete “and”.
Seanad amendment agreed to.
Seanad amendment No. 10:
Section 12: In page 17, to delete lines 12 and 13 and substitute the following:
“(v) any monies liable to be paid by the trader to—
(I) a producer who is not, in relation to the trader, an affiliated person, or
(II) an intermediary who is not, in relation to the trader, an affiliated person, shall be deducted, and
(vi) any monies which exceed the trader’s monthly capped revenue and which are liable to be paid by the trader to—
(I) a producer who is, in relation to the trader, an affiliated person, or
(II) an intermediary who is, in relation to the trader, an affiliated person,
shall be deducted.”.
Seanad amendment agreed to.
Seanad amendment No. 11:
Section 14: In page 19, to delete lines 5 to 14.
Seanad amendment agreed to.
Amendments Nos. 12, 14 and 15 are related and will be discussed together.
Seanad amendment No. 12:
Section 15: In page 19, line 24, to delete “30 November 2023” and substitute “31 December 2023”.
Given the short period between the planned completion of the Bill through the Oireachtas and the requirement for there to be sufficient time for relevant parties to make returns and payments, it is prudent to amend the dates in these amendments by one calendar month, respectively. These amendments should therefore also reduce the risk of a future legal challenge.
We have been a long time waiting for this legislation. When I saw this Bill in our office this week, I presumed it was the legislation relating to energy credits. I find it amazing that we are still dealing with this Bill, but we are, and with these amendments back from the Seanad. It must be a month at this stage since we dealt with this Bill here previously. It must be borne in mind that when we debated this legislation then, I wanted us to be tighter on the timelines and to be making more aggressive commitments in terms of such timelines, but we are now seeking to cut even more slack and to push back by a month the making of returns and of payments.
I make the broad point that this is deeply frustrating. People are in urgent need of support. They urgently need to have confidence in our energy system and energy markets in respect of there being accountability and some degree of equity and fairness in the system. I refer to exorbitant, super-excess profits being seen as unfair and, as such, being tackled and captured and redistributed.
I just wanted to put that on the record. When will this legislation be enacted and when will people see the benefit of this windfall tax being distributed?
The Deputy mentioned that he believed this might be the electricity credits Bill. He will be happy to hear that the President signed that legislation into law four days ago, so it is in operation. That involves the distribution of up to €1 billion of money to help people with their electricity bills through the winter. This Bill relates to putting a cap on the price electricity generation companies can charge for their electricity over a period in the past. This is to recapture excess profits that were made by the industry, take that money and return it to people in the form of electricity credits or some other form of distribution to help people with the high price of electricity. The amendment gives the industry one extra month to pay its bill. The reason we are making this change is that the Commission for the Regulation of Utilities consulted with the industry and its belief was that in practice, it would be difficult to collect the money in time and it may be subject to legal challenge if it did not allow an extra 30 days. As a result, we are giving the industry until the end of the year to file returns and then until the end of January to make the payments. In the meantime, the Government will be starting that distribution of €1 billion to electricity customers on 1 December. Any money that is returned from this Bill will help defray those costs but the distribution of money to people who need it to pay their electricity bills will not be delayed by this.
That does not answer the question I asked. When will people see the benefit of this legislation? The Minister of State should bear in mind that the Government is among the slowest in Europe to move on this matter. It was decided at European level last October and November. Many European countries have already moved and implemented legislation. When will people see the benefit of this windfall tax? It should be borne in mind that people have been paying exorbitant household and business rates for electricity for the past 12 months and more. Wholesale prices have come right down and very few savings have been passed on to consumers. They want to see aggressive action from the Government. It is not enough to say we have an energy credit that we are doing separately to this. When will people see the benefit of this windfall tax?
The electricity credits are not separate from this. They are funded by this legislation. In fact, the first payment, which will cost up to €300 million, will be made on 1 December. Anybody who is on a pay-as-you-go meter will see that on their bill immediately.
We are paying out on the energy credit. Tomorrow, the Select Committee on Environment and Climate Action will meet to agree the additional moneys to transfer. The Minister of State should not tell people it is going to be funded out of this legislation, which has not even been passed. When will people see the action of this windfall tax? Is it next September, as was originally intended? What moneys will be accrued and how will they be distributed to people to relieve them of the high cost of electricity, which I presume given the current performance will continue well into next year?
Does the Minister of State want to come back in?
I have answered the question several times. On 1 December, a large payment will be made. Approximately €300 million will be put into people's electricity accounts. Everybody who has an electricity account and has a property that was not vacant for a year will receive money into their account. We have already passed one windfall Act which takes money from those involved in oil refinery or gas extraction. That Act has collected €167 million in revenue already. That money is being used to defray the costs of electricity credits. This Bill will collect money on the last day of January 2024. That money will also be used to defray the costs of these electricity credits and other payments that are being made, for example, the once-off payments to people on fuel allowance and increases in payments to people who are considered to be in fuel poverty. The Deputy asked when people will see the benefit. They will see the benefit immediately starting from 1 December.
Seanad amendment agreed to.
Before going through the next three amendments, I note that things have moved much quicker than anticipated. For the information of Members, the next item, the Health (Termination of Pregnancy Services) (Safe Access Zones) Bill 2023, Report and Final Stages, will be starting immediately after this item, in just a few minutes.
We got caught out last week. That is why we are here now.
Seanad amendments Nos. 13 to 15, inclusive, have already been discussed.
Seanad amendment No. 13:
Section 15: In page 20, between lines 1 and 2, to insert the following:
“(viii) any affiliated person in relation to the person making the return,”.
Seanad amendment agreed to.
Seanad amendment No. 14:
Section 20: In page 22, lines 24 and 25, to delete “31 December 2023” and substitute “31 January 2024”.
Seanad amendment agreed to.
Seanad amendment No. 15:
Section 21: In page 24, lines 9 and 10, to delete “30 November 2023” and substitute “31 December 2023”.
Seanad amendment agreed to.
Seanad amendments reported.
A message will be sent to Seanad Éireann acquainting it with the fact that Dáil Éireann has agreed to amendments Nos. 1 to 15, inclusive, made by Seanad Éireann to the Energy (Windfall Gains in the Energy Sector) (Cap on Market Revenues) Bill 2023.