Mr. Robert Deegan:

I thank the committee for the invitation to address today’s meeting on the subject of the energy performance of buildings directive. I am joined by my colleague, Mr. Tony Collins, principal officer in the heat and business energy efficiency division.

An important aspect of the EPBD proposal is the development of a national building renovation plan to ensure the renovation of the national stock of residential and non-residential buildings. This builds on the requirement of the existing directive on the preparation of a long-term renovation strategy. The Department of the Environment, Climate and Communications published Ireland's current long-term renovation strategy in 2020. This plan sets out our long-term strategy for the renovation of buildings to ensure that Ireland’s building stock is highly energy efficient and decarbonised by 2050.

The Department has since published the national retrofit plan as part of the Climate Action Plan 2021. The retrofit plan sets out a detailed roadmap to achieving our targets of retrofitting the equivalent of 500,000 homes to a building energy rating of B2 and installing 400,000 heat pumps in existing homes by 2030. This will see approximately 30% of the housing stock being upgraded to warmer, healthier and more comfortable homes, with lower energy bills, lower emissions and enhanced asset values.

The plan is designed to address barriers to retrofit across four key areas. These are driving demand and activity, financing and affordability, supply chain, skills and standards, and structures and governance. For each of these areas, barriers were identified and time-bound policies, measures and actions were put in place to address them. Successful implementation of the plan depends on ensuring that effective policy action is taken, and balanced progress is made, under each pillar simultaneously.

Important proposals in the 2022 review of the EPBD, such as the requirement to support renovation through appropriate financial measures, prioritising people affected by energy poverty, providing technical assistance through one-stop-shops, designing financing schemes and addressing the split incentive, are all in line with commitments in the retrofit plan. Good progress has already been made on the implementation of initiatives in this regard. In February, a range of new and reformed SEAI grant schemes were launched to support homeowners to decarbonise their homes, making it easier and more affordable for homeowners to undertake home energy upgrades.

Budget allocations for schemes targeted at those in energy poverty have been significantly increased this year and enhanced supports for approved housing bodies and the private rental sector are also available. The new measures include a new national home energy upgrade scheme providing increased grant levels of up to 50% of the cost of a typical deep retrofit to a BER standard of B2. There is also the establishment of a network of registered one-stop shops to offer a start-to-finish project management service for home energy upgrades including access to financing.

There is a significant increase in the number of free energy upgrades provided to those at risk of energy poverty alongside changes to the operation of the warmer homes scheme. This includes ensuring the scheme prioritises those in the worst performing homes first and opening the scheme for homeowner revisits, thereby allowing them to apply for deeper energy upgrade measures now available under the scheme. A special enhanced grant rate, equivalent to 80% of the typical cost, for attic and cavity wall insulation has also been introduced for all households. This will help to reduce energy use urgently as part of the Government’s response to exceptionally high energy prices.

These new initiatives will be funded by the national development plan financial allocation for residential retrofit of €8 billion to 2030. By providing clarity on the annual allocations for the coming years as well as the total allocation to the end of the decade, the plan gives the retrofit sector the confidence to invest, plan for the long-term and expand. New and expanded upskilling, reskilling and apprenticeship supports will also help to ensure we have the skilled workforce available to deliver on our targets.

A total of €267 million has been allocated for SEAI residential and community retrofit schemes and the solar PV scheme in 2022. This is the highest ever allocation for the schemes. The investment this year will support almost 27,000 home energy upgrades, including more than 8,600 homes to a BER of B2. This is a near doubling of the number of homes delivered to B2 standard in 2021. In addition, as Mr. Armstrong mentioned, €85 million in funding has been provided by the Minister for Housing, Local Government and Heritage for the local authority energy efficiency retrofit programme. This means that of the total Government retrofit budget of €352 million, 58%, or €203 million, will be spent on dedicated energy poverty schemes and local authority retrofits.

The retrofit plan recognises that even with the enhanced grant rates available, many will need to access finance to fund their upgrade. For this reason, the Department is working with the Strategic Banking Corporation of Ireland, the Department of Finance, the SEAI, the European Investment Bank and financial institutions to design a new low-cost loan scheme for retrofit. This scheme will be introduced later this year and will help to address further the affordability issues related to retrofit. This again is in line with the directive proposals. We are working closely with colleagues in the SEAI, the Department of Housing, Local Government and Heritage and other relevant Departments to further build momentum and ensure the building stock is decarbonised in line with our 2050 net zero commitments. We are happy to address any question the committee may have.