Alice-Mary Higgins (Independent)
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I thank the director for her presentation and for the discussion thus far. We are in the process of examining the approach Ireland takes to implementing these measures. The director said that the Commission has had indications from member states of the approaches they intend to take and it would be very useful to get a sense of the approach that others are taking.

Deputy Smith highlighted a very pressing issue and it would be good to get a written response on it, namely, what capital gets written off and excluded. We want to make sure this is an effective contributory measure. Will the director comment on the implementation of this measure because that gives us a comparator with other countries? How normal is it in other countries to have royalties and effective tax, for example? Ireland has had an effective tax rate for fossil fuel companies of about 0%. We have quotes from some of the major companies that will be affected, like Vermilion Energy and others, that they do not expect to pay taxes for the foreseeable future. That was said back in 2017 and was based on extraordinarily generous measures that allowed them to write off very substantial profits as losses. In the case of Ireland, some of these companies have not been paying tax for many years. How normal is it to have fossil fuel companies paying 0% tax and 0% royalties, in advance of this new solidarity contribution measure being introduced? That is going to be very important in terms of the decisions we take on exactly how we bring it forward.

Again, because it is a solidarity contribution, we want to ensure something substantial is contributed.

I will move to the other part of that, which is that, as I understand it, the EU measure calls for targeted distributive measures. Will Ms Sikow-Magny comment on some of the approaches countries are taking in terms of the targeting of the revenue that is raised? I know it is for households and companies, but given it is framed as an emergency measure and there is a solidarity contribution, are measures being taken by countries to ensure it is for companies that have need of it and not, for example, large companies that have increased their profits during recent years or during the crisis? We know there are companies whose profits have gone up, and not just fossil fuel companies because, for example, some other sectors had increases in profits during Covid. In terms of that targeting measure which is recommended by the directive, Ms Sikow-Magny might outline her thoughts on how that is approached.

I am particularly looking at households. It struck me that in Ms Sikow-Magny's last response on demand reduction, households were being pushed into demand reduction because of the high prices, whereas it seems companies were being paid to reduce demand, so there is even an unfair treatment and measure in that regard. One of the things we are looking at in Ireland, which we need to look at, is the question that we might need demand response measures that are mandatory as well as demand reduction as a market in itself. That would include more concrete measures so we can ensure that when there is an urgent need for demand reduction, it is not primarily falling on households who may, in fact, be taking risks with their health. Perhaps Ms Sikow-Magny would comment on that targeting piece.

I have two other questions that are slightly wider. First, we know a case is being taken against the solidarity contribution by Exxon Mobil, and I believe Vermilion is also part of that case. In regard to those issues, Ms Sikow-Magny probably cannot comment in much detail on a legal case that is under way. However, it speaks to the wider issue, which is that, last February, the European Commission recommended there would be an EU exit from the Energy Charter Treaty to ensure we are not continuing to have this kind of vulnerability. The articles I have read quote the point that it is clearly incompatible with our climate goals, but we are now also seeing the danger of the Energy Charter Treaty in terms of both our climate goals and our collective EU social cohesion goals that are being reflected here in terms of good energy policy in general. At a time when the Commission is taking a more active role and coming up with new active approaches to the energy market, how important is it that both the Commission and the countries are able to come forward with policies without the chilling effect or lock-in effect of the Energy Charter Treaty?

I have two final points.