Wednesday, 16 October 2019

Ceisteanna (36)

Seán Sherlock


36. Deputy Sean Sherlock asked the Minister for Communications, Climate Action and Environment the amount of funding being allocated to the climate action fund. [42523/19]

Amharc ar fhreagra

Freagraí ó Béal (8 píosaí cainte) (Ceist ar Communications)

I pose this question to ascertain from the Minister what the total climate action budget will be for 2020. The carbon tax yield was pegged at €90 million in the budget last week. We were told that will be ring-fenced to protect the most vulnerable in society, support sustainable mobility, provide agri-environment schemes and plan for a low-carbon future. I would like the Minister of State to drill down a little further and elaborate on what that means in pounds, shillings and pence and the types of initiatives he is going to bring forward regarding climate action.

I thank the Deputy for the question. The climate action fund is one of four funds established under the National Development Plan 2018-2027 as part of Project Ireland 2040. The fund supports initiatives that contribute to the achievement of Ireland's climate and energy targets in a cost-effective manner. It also offers the potential for innovative interventions which, in the absence of support from the fund, would not otherwise be developed.

Following the first call for applications, the Department announced the seven successful projects which will receive up to €77 million in support. Funding was allocated following a competitive process with public and private sector organisations eligible to apply. Many of these projects will be developed over a number of years and therefore I estimate that the expenditure from the fund in 2020 will be approximately €10 million. As funding for the climate action fund is financed from non-Exchequer resources, no specific allocation provided in budget 2020.

The national development plan provided an allocation of €500 million for the fund from 2018 to 2027. This funding will be provided from non-Exchequer resources, with the majority coming from excess levy income collected by the National Oil Reserves Agency, NORA. The legislation to enable these funds to be repurposed is expected to be published shortly for consideration by the Oireachtas.

I am glad that the Minister of State mentioned NORA. It has been indicated that NORA's current surplus funds will be used for climate action measures. Is it legally possible for those funds to be used in that way now? My second question concerns figures given to the Joint Committee on Communication, Climate Action and Environment suggesting some 17.4% of households are considered to be fuel impoverished. There is nothing in any of the budget announcements that will do anything to generate programmes to deal with fuel poverty. I refer to ensuring a massive programme of retrofitting is initiated to take carbon out of houses.

NORA is currently funded by a levy at a rate of 2c per litre. This levy is charged on the sale of most petroleum products at the point of sale and paid for by consumers. It is collected by the oil companies each month and paid to NORA to fund its activities, including operating expenses incurred in the purchase of petroleum products and securing storage in Ireland and abroad. The NORA levy was increased in 2009 from 1c to 2c to reduce the €440 million debt NORA had accrued for the purchase of oil reserves in line with Government policy. On 29 May 2018, the Government approved the development of a climate action fund to fulfil the commitment set out in the national development plan. This Government decision approved the use of excess NORA levy moneys to provide financing to the fund.

A further Government decision, made on 27 November 2018, approved the general scheme of the National Oil Reserves Agency (Amendment) and Provision of Central Treasury Services Bill, which provide for the use of surplus NORA levy funds for the climate action fund, subject to refinement following further discussions with the Office of the Attorney General. This legislation is being developed to amend the National Oil Reserve Agency Act 2007 to provide for the expansion of the use of levy funds collected to fund both agency expenses and the climate action fund. This legislation will be published for consideration.

Turning to fuel poverty, some €34 million has been allocated in that area this year and we have also doubled the allocation for the warmer homes scheme for 2020.

The Minister of State is telling us, de facto, that it is not legal to use the current NORA excess reserves for climate action measures, but that it is to be made legal by passing the Bill to which he referred. The reference to NORA's excess reserves can be taken off the table as being spoken of as part of the climate action fund. When the Government is allocating funds, it is important that it does not refer to funds to which it does not have access. I refer to not being legally entitled to take moneys from NORA to use for climate action. It is important to have that clarified.

Turning to the just transition commissioner, is it the case that he or she will now be funded by the private sector and industry? I also make the case that there needs to be a regional balance regarding climate action. We all support measures proposed for a just transition in the midlands.

It is vital that every region throughout the State is looked at and that each should come up with a set of proposals. I thank the Minister of State for his intervention in the context of hearing from the regions. It is vital there is equality in any of the proposals that come forward in respect of projects that meet the criteria relating to climate action.

It has always been the intention that legislation to facilitate the use of the NORA fund for climate action would be introduced. The commissioner will not be funded by the private sector. Just transition is high on the agenda when it comes to climate action. The Deputy will have heard the Minister replying to a question from Deputy Dooley on the issue of Moneypoint. In the context of just transition, the first project relates to the midlands in the aftermath of the decision relating to Bord na Mona's operation there. Then comes Moneypoint. This matter will be dealt with in a fair way in order that there will be a just transition for everybody in the region who is affected by climate action measures. It is important to note that the funding to be raised through carbon tax could be sufficiently substantial to allow us to deal with all of these issues. While there are challenges, we also have the potential to drive on and ensure that the jobs we create are sustainable and that everybody gets a fair share.

The €90 million from the carbon tax is just a drop in the ocean.

I must point out to the people in the Public Gallery, and to those who may be watching at home and scratching their heads, that NORA is not a lady carrying out research in respect of climate action. NORA is the acronym for the National Oil Reserves Agency. Acronyms and abbreviations are part of everyday life but people sometimes do not know for what they stand.