Eamon Ryan (Dublin Bay South, Green Party)
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I thank the Chair and committee for the opportunity to present details of the Supplementary Estimate for the Department of the Environment, Climate and Communications. I am seeking the approval of the committee for the Supplementary Estimate allocating a total of €1.362 billion to provide the necessary additional funding of €1.212 billion to subhead B11, electricity credit, and €150 million to subhead B13, emergency generation capacity, both of which are in the energy transformation programme. I am also requesting approval to reallocate €7 million as follows: €6 million for subhead A7, climate initiatives; and €1 million for subhead B6, other energy programmes, national and international.

This reallocation is possible due to savings identified within the climate action and environment leadership area under subhead A4, environmental and climate research, where savings of €2.5 million have been identified; subhead A5, carbon fund, where savings of €3.5 million have been identified; and subhead C3, mining and petroleum services, where savings of €1 million have been identified.

The Government took steps earlier this year to help alleviate the burden on households of the rapidly increasing energy costs when we provided for a credit of €200, including VAT, to be applied to domestic customers' energy bills under the first electricity costs emergency benefits scheme. However, electricity and gas prices have continued to rise due to international conditions, in particular the current challenges arising from the crisis in Ukraine, and indications are that this trend will continue for the foreseeable future.

The Government has taken action in budget 2023 to provide further assistance to those who are most vulnerable to the effects of the cost-of-living crisis. A wide range of measures were introduced, including a €600 electricity credit to be applied in three instalments between November 2022 and April 2023. Additional social welfare payments totalling €1.2 billion across a number of benefits and schemes will support in the region of 1.5 million people over the coming winter period. Further measures introduced by the Government involved significant support for commuters and students. The reduced public transport fares announced previously are to be extended to the end of 2023 and a number of measures have been put in place to help eligible students with academic fees.

In light of the continued increase in household energy bills, the Government has decided to support domestic customers further through a second electricity benefit scheme for this winter. The Electricity Costs (Domestic Electricity Accounts) Emergency Measures Act 2022 provided for the electricity credit to be made under the scheme on a once-off basis in 2022. Therefore, new legislation was required for this scheme to be established. The Electricity Costs (Domestic Electricity Accounts) Emergency Measures and Miscellaneous Provisions Bill 2022, which provides the legal basis for the new scheme, passed all Stages in the Oireachtas on 13 October and was signed by the President into law. The new scheme will be closely modelled on the previous one and an electricity costs emergency benefit payment of €200, including VAT, for an estimated 2.2 million domestic accounts is to be paid in each of the November-December 2022, January-February 2023 and March-April 2023 electricity billing cycles, totalling €600, including VAT, per domestic electricity account. This scheme will have a ceiling of €1.211 billion and within this, a contingency has been included to ensure there is no shortfall to cover the increase in any new domestic customers during the period of the scheme. The scheme will be operated by ESB Networks which will make payments to the individual energy supplies. Those suppliers will, in turn, credit individual domestic electricity accounts. The Commission for the Regulation of Utilities, CRU, will be charged with oversight of the scheme.

A further €1 million will be allocated for those domestic customers whose households many not have an individual meter point reference number, MPRN. Upon completion of the previous electricity credit scheme, the need to have an MPRN resulted in certain cohorts not being able to access the payment. A particular cohort since identified includes some Traveller families in certain local authority accommodations where the MPRN is registered to the local authority and supplies multiple households. Work is under way to establish an alternative mechanism to ensure the payment reaches these Traveller families.

VAT must be applied on the electricity bill balance after the credit has been applied. On that basis, the credit of €183.49 is being applied exclusive of VAT on each account. Inclusive of VAT, the total reduction on each household electricity bill will be €200.

Earlier this year, the CRU directed EirGrid, the transmission system operator, to procure some 450 MW of additional temporary generation capacity for winter 2023-24 through to winter 2025-26 to offset a potential capacity shortfall of electricity supply. The temporary generation capacity may be extended to winter 2026-27, if necessary. To comply with this direction, EirGrid requires financial support from the Exchequer. Legislation to ensure EirGrid can carry out this direction, including the legal basis for my Department providing the necessary financial support, passed all Stages in the Oireachtas in July of this year and was signed into law by the President.

The level of financial support required in 2022 to allow EirGrid place orders on the electricity generation units and to ensure they are delivered and installed in time for winter 2023-24 was estimated at €350 million. As the final level of financial support required in 2022 was not known earlier this year as the contractual arrangements were still at an early stage at that time, it was agreed that approval of the allocation of funding for the emergency generation capacity would be requested in two tranches. A previous allocation request of €200 million was granted in July with the indicative funding request for the initial stages of the project, with a further request forecasted to be required in the autumn of €150 million when the contractual details were close to finalisation. These contracts are now ready to be finalised subject to final terms being agreed and the balance of funding being available. The €150 million balance of funding represents the final agreed figures required by EirGrid for the purchase of the generation equipment and balance of the plant this year.

The total cost of the electricity costs emergency benefit scheme is, as I said, estimated at €1.212 billion and the balance of funding for the emergency power generation scheme is €150 million. As the additional funding of €1.362 billion required is being provided from the Exchequer, the main purpose of this Supplementary Estimate is to allocate €1.212 billion to subhead B11 and €150 million to subhead B13 in the energy transformation programme area to fund the two measures.

In addition to the approval for the Exchequer funding for the two schemes, I am also seeking approval to reallocate €7 million within subheads in my Vote to provide for expenditure for a number of other measures.

Local authorities have a particularly important role in the delivery of both climate mitigation and adaptation. This is reflected in the provisions of the Climate Action and Low Carbon Development (Amendment) Act, which requires each local authority to prepare a local authority climate action plan, specifying the mitigation and the adaptation measures to be adopted by the local authority. These plans will be updated once every five years. The first of these plans is due to be submitted by each local authority by the end of 2023. This funding will allow the Department to establish a governance structure with local authorities for the development and reporting of these climate actions plans. I am seeking approval to provide funding of €3.5 million in 2022 through the allocation of savings identified within the climate action and environment leadership programme area.

My Department has secured support from the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media and the Broadcasting Authority of Ireland, BAI, for a climate-specific round of the sound and vision scheme to address the need to fund programming specific to the climate crisis. This programming will contribute to an important component of delivering on the national dialogue’s objective of improving climate literacy. Improving climate literacy will enhance the capacity of people to make small changes in their daily lives, engage with climate action at a local level in their communities and at national level in the co-design of policy. Through the expertise of the BAI and the vision of Ireland’s programme makers, we will ensure the delivery of a range of innovative and creative programming to bring climate awareness, literacy and empowerment into homes across the country. To facilitate this, I am seeking approval to provide funding of €2.5 million in 2022 through allocating savings identified within the climate action and environment leadership programme area.

The national energy security framework published earlier this year places a significant emphasis on the replacement of fossil fuels with renewable energy to underpin Ireland's security of supply. The Government is committed to ensuring that the planning system is fully supportive of the roll-out of renewables, something first expressed in action No. 102 of the climate action plan 2021.

As part of its ongoing effort to improve the delivery of its service, An Bord Pleanála recently provided the Department of Housing, Local Government and Heritage with a specific resource plan for the area of maritime development and climate action, including the establishment of the marine and climate directorate. The total funding requirement for the establishment of the new functions is expected to be in the region of €3.5 million and my Department is committing to provide €1 million in once-off funding in 2022 to support the set-up of this function. I am seeking approval to provide this contribution under subhead B6, other energy programmes (national and international), in 2022 through allocating savings identified in subhead C3, mining and petroleum services.

I am happy to take questions from the committee on any aspect of this Supplementary Estimate.