Professor John FitzGerald:

I am delighted to have this opportunity to talk to the committee. I will not go through the comments in my written statement concerning the urgency of taking action, but we are heading in the wrong direction on climate change. While taking action can be expensive, there can be co-benefits in respect of health and the environment. The job of the council I chair is to advise on how we can decarbonise Irish society at least cost. There have been wins in respect of renewable electricity whereby the cost of electricity for consumers until 2012 was lower because of the deployment of renewable electricity. Win-wins are available.

Regarding the urgent need to take action, I was asked to say something about the emissions targets. We will miss our target for 2020 by a significant amount. We will miss the 2030 and 2050 targets because we are heading rapidly in the wrong direction. Without major new policy initiatives, and based on business as usual and policy as usual, we are heading in the wrong direction. The nature of the initiatives will require broad support in the Oireachtas if they are to happen. It is not just Government that decides; it is the Oireachtas that decides. That is why I particularly welcome this opportunity to give the committee our advice.

Looking to the future, we need to consider a range of different scenarios because we are uncertain what will happen. The forecasts are based on work I did in 2013 and 2014 on growth over the next decade. In the work I did in 2013 and 2014, we may have been too pessimistic about the economy, and the problems may be greater than we think they are, so we need, and the Department needs, to go back and look at the scenarios. The cost of technologies has fallen more rapidly than expected, so that is an area in respect of which we need to map out a route to the future which will be internally consistent. If we electrify transport but do not deal with the problem of electricity itself, we could lock matters into a bad place.

The council is strongly of the view that we need to reflect the damage emitting carbon does to climate and the world in the price of carbon. We need first of all a carbon tax, and there are three reasons for this. It discourages us from burning fossil fuels and encourages us to switch to alternatives such as renewable electricity. It also results in revenue for the Government, which can be used to cut taxes elsewhere and can be used in investment in climate change. The ESRI published between 1991 and 2014, when I retired, on average one and a half reports a year on why carbon taxes are the right solution. There is nothing new to be said on this issue. One of the key reasons is that Ireland could be better off with a carbon tax because it may reduce the need for taxes elsewhere, so there is a benefit. The third, and probably most important, reason is that business in Ireland and worldwide knows it will make money out of investing in technologies that will be clean if the price of carbon is high. This is what is driving the research in electric cars worldwide: the prospect that carbon will be expensive. This is why we need to reflect the damage done to climate in the price of carbon.

One area we are concerned about is the EU emissions trading scheme. In our first statement, in June 2016, we recommended the Government support the French initiative to put in a carbon price floor, which would have guaranteed a rising and substantial price of carbon and electricity. It would have sent the right signal and obviated the need for subsidies for renewable power because the price would have made it profitable to invest in renewables. This is a much better solution. One thing we need to explore is whether Ireland, along with a range of other countries, should introduce a carbon price floor even if the EU does not do so. The Dutch Government in its most recent programme for Government proposes to do so. These are areas in respect of which we must deal not just with the non-ETS sector, but with the ETS sector as well, electricity in particular.

The council has strongly recommended we stop subsidising peat-fired power generation. The subsidy is €100 million a year to keep a few hundred jobs in place. One could produce real, sustainable jobs which are not damaging society by spending just one year's subsidy. It is right that people who lose out from our tackling climate change should be compensated, and we need to do so. The money is there. To spend €100 million a year on subsidising the emission of 2.75 million tonnes of carbon dioxide does not seem wise or sensible. That is important.

Finally, we need to define what neutrality is in agriculture. We need to take the win-wins. Agriculture will have to change significantly, particularly in the context of land use. Changes to land use could make a big difference, taking carbon out of the atmosphere rather than pumping it into it.