Brian Leddin (Limerick City, Green Party)
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Apologies have been received from Senator Pauline O'Reilly. The purpose of this morning's meeting is to discuss energy poverty. I am delighted to welcome, on behalf of the committee, the following witnesses. Joining us online is Ms Michelle Murphy and Ms Susanne Rogers of Social Justice Ireland. In the room we have: Ms Issy Petrie, the Society of St.Vincent de Paul; and Ms Clare O'Connor, Friends of the Earth. Our guests are all very welcome.

Before we begin, I will read out the note on privilege. I remind the witnesses of the long-standing parliamentary practice that they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable, or otherwise engage in speech that might be regarded as damaging to the good name of the person or entity. If their statements are potentially defamatory in relation to an identifiable person or entity, I will direct them to discontinue their remarks, and it is imperative they comply with any such direction. For our witnesses who are attending remotely, they may not benefit from the same level of immunity from legal proceedings as a witness who is physically present on the campus. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable. I remind members that they are allowed to participate in the meeting only if they are physically located in the Leinster House complex. I ask those members who are joining the meeting online that, prior to making their contributions, they confirm they are on the grounds of the Leinster House campus.

I call Ms Petrie to make her opening statement.

Ms Issy Petrie:

I thank the committee for the invitation to present today on our experience supporting people in energy poverty. This is an important opportunity to reflect on the impacts of this winter and prepare for the year ahead.

Society of St. Vincent de Paul members are currently seeing the hardship caused by ongoing high energy prices. Last year, we saw a 40% increase in requests for assistance related to energy. In the first quarter of this year, we have seen energy requests increase by approximately a further 50% against the same period last year. This is part of a wider trend of our overall requests rising by approximately 20%.

Members are now supporting many households who are facing multiple bills that they cannot clear before the next one comes through. The situation continues to be extreme for prepay customers who continue to face self-disconnection when there is simply no more money to feed the meter. People are forced to make strategic choices between essentials such as to have food through the week, or energy through the week. No-one should be faced with that dilemma. It takes a toll on people's emotional, mental and physical health and our members see that distress when they are assisting people.

The situation is clearly spelt out in the energy deprivation figures from the Central Statistics Office, CSO, from 2022. The rates are stark and show the inequitable distribution of hardship that our society also witnesses. Around one in five single parents and people who were out of work due to illness, disability or unemployment could not afford to keep their homes warm enough in 2022. Rates for renters almost doubled and are three times as high as for owner-occupiers.

The rate for people living rurally increased fourfold.

To stop this trend continuing, we need to have clear priorities for action ahead of next winter. Our particular concerns at this time are putting in place the assistance people need to pay back arrears without cutting back on other essential expenditure; making sure prepay customers do not face another winter without sufficient protection; and, longer term, making sure we are tackling all the causes of energy poverty to bring it to an end across income, energy costs and energy efficiency. I will outline a number of our recommendations that we believe are necessary to achieve this.

With core social protection rates not keeping up with inflation, we also saw the rate of the fuel allowance frozen, with the choice to opt instead for ad hocpayments. While those payments provided essential support to households, we are now faced with a severely devalued fuel allowance. The fuel allowance payment also does not reach everyone who is in energy poverty. We are particularly concerned about people on the working family payment, including the 103,000 children in those families.

We would like to see targeted action on energy prices through a Government-subsidised social tariff to provide a discounted energy tariff for households on means-tested social welfare payments. This would enable the Government to provide focused support that can offer stable costs for an essential service and respond to market conditions.

We need to see further action on our consumer protection infrastructure to ensure the experiences and voices of consumers are clearly heard within the market. We would like to see further monitoring and research as part of a consumer protection strategy from the regulator, and a new consumer advocacy agency.

Finally, and crucially, we propose a new service of community energy advisers who provide one-to-one support for people to navigate the energy market, to access available financial supports, to provide energy efficiency advice and easy, quick installations at home and to support access to retrofitting grants. This is needed not only to support people through the price crisis but also to ensure a just energy transition in the coming years.

A key point we would like to make today is that while we have left winter behind, we are still facing an energy price, and energy poverty, crisis. It is now that we need to be stepping in with people's bills and addressing the risks facing prepay customers. Ongoing energy costs will continue to be unaffordable for many throughout summer, and we need to enter next winter having learnt lessons from this year. We also need to make sure our longer term strategies are adequate in the face of ongoing higher prices, higher levels of energy deprivation and a rapidly changing energy landscape.

Brian Leddin (Limerick City, Green Party)
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Thank you for your opening statement, Ms Petrie. I will go to Ms O'Connor now. I note that your statement is quite long, Ms O'Connor. You may need a little more than five minutes - six or seven minutes?

Ms Clare O'Connor:

I am okay.

Brian Leddin (Limerick City, Green Party)
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Go ahead.

Ms Clare O'Connor:

I thank the Chair and the committee for the opportunity to present on behalf of Friends of the Earth. It is really important and welcome that the committee is addressing energy poverty ahead of this winter. We believe that affordable renewable heating alongside energy efficiency and income supports for low-income households and marginalised groups must be a Government priority this year.

I will start by sharing the findings of recent research that was completed for Friends of the Earth which reviewed the effectiveness of Government responses to energy poverty and the climate crisis to date. The research ultimately found that policies currently lack in scale and ambition and are not addressing the root causes of energy poverty such as the energy credit, which does not target those who are most in need. Tenants in the private rental sector are particularly vulnerable to energy poverty and suffer from weak regulation, poor-quality housing and low building energy ratings, BERs. There are also serious problems with current Government retrofitting programmes, including waiting lists of up to three years for the fully funded energy upgrade scheme, as well as major labour and skills shortages. We are also concerned that the scheme continues to fund installation of oil and gas boilers, which risks locking low-income households into fossil fuels for years to come. The role of the Commission for Regulation of Utilities, CRU, and other public bodies such as Gas Networks Ireland, GNI, must be reformed to ensure that they are optimally supporting the aims of emissions reductions and energy poverty reduction.

I will next look at fossil fuel dependence. Ireland currently has the lowest levels of renewable heat in the EU. Irish homes use 7% more energy than the EU average and emit 60% more CO2. Ireland currently does not have sufficient safeguards to protect against price volatility as a result of the heavy role of fossil fuels in our home heating and energy mix.

There is a major risk that the current situation will deteriorate further in 2023, given high inflation and continued high energy costs. It is clear that household fossil fuel dependence cannot be allowed to continue. A future where we have halved our emissions by 2030 will mean not only warm retrofitted homes but also affordable, clean heat delivered by heat pumps or renewably sourced district heating. Aiming to install 400,000 heat pumps in homes is the correct level of ambition required. However current grants are skewed towards households that have sufficient disposable income, leaving many unable to participate in the energy transition. Friends of the Earth is increasingly concerned that Ireland may end up with essentially a two-tier energy and heating sector, where higher income households are able to take progressive measures to reduce their reliance on fossil fuels while lower-income households are left to struggle in inefficient buildings, with high bills.

We are also concerned that the fully-funded energy upgrade scheme continues to lock low-income households into burning fossil fuels. In 2022, 759 gas boilers, 471 oil boilers and just 40 heat pumps were installed through this scheme. The average lifespan of an oil or gas boiler is around 15 years. This means that it will likely be over a decade and even two before these households make a decision on replacing their heating system, effectively creating a carbon lock-in. The Department must prioritise retrofitting with a view to getting these homes heat pump ready. We also encourage the committee to engage the Government on new ways of distributing energy bill costs to make electric heat pumps and district heating cheaper than fossil fuel boilers, as has been done in Denmark.

We are increasingly concerned about the role of Gas Networks Ireland in expanding the gas grid and continuing to connect homes to the gas network. This is despite all net-zero scenarios in the 2022 SEAI heat study showing a significantly reduced role for the gas grid.

On retrofitting and energy poverty, improving the energy performance of a home through retrofitting has the potential to reduce energy bills and improve health conditions, as noted by the Society of St. Vincent de Paul. Our research found that vulnerable and lower-income households with a low BER should be targeted as they make up the bulk of the 500,000 homes to be retrofitted by 2030. This could be facilitated by deploying community energy advisers to engage these households proactively.

In the private rental sector, tenants have little to no ability to influence the insulation levels in their homes. It has been estimated that more than half of privately rented properties had a BER rating of D or less. The Housing for All strategy has committed to introducing a minimum BER for the private rental sector from 2025. However, details of this are yet to be announced and signals have not yet been sent to landlords.

Tenants in social housing are the most likely to qualify as experiencing energy poverty, with almost 70% of such households estimated to be living in energy poverty. Current retrofitting targets for social housing would see just 36,500 households of the 140,000 social housing units retrofitted to a B2 level by 2030. Friends of the Earth, therefore, recommends that the committee takes the following responses to energy poverty. We ask that the committee writes to the Minister for the Environment, Climate and Communications to highlight the need for the SEAI to take a much more proactive role in reaching households at risk of energy poverty and deploying community energy advisors in every local authority. We want to see access to the fully funded energy upgrade scheme expanded to include tenants on HAP on the condition of a long-term lease being offered. We also want to see the cessation of installation of oil and gas boilers through the fully funded energy upgrade scheme, with a view to ensuring all homes retrofitted through the scheme are heat pump ready. The low-cost loan scheme for retrofitting must be launched as a matter of urgency and BER assessments and technical assessments required for heat pump grants should be fully subsidised for low-income households. We want to see expanded membership of the energy poverty steering group that includes civil society organisations that work on energy poverty.

We also see a need for the committee to write to the Minister for Housing, Local Government and Heritage, highlighting the need for increased targets for retrofitting of social housing, with a view to ensuring all social housing units reach a minimum BER of B2 by 2030, and a policy statement with a clear timeline for the introduction of minimum BERs in the private rental sector.

Legislation will be needed to prevent the expansion of fossil fuel heating by ending new connections to the gas grid from this year, as has been done in the Netherlands and Denmark. We also need legislation to provide clarity on phase-out dates for fossil fuel boilers by introducing obligations for replacement heating systems to be renewable from 2027 at the very latest, as is being done in the Netherlands, Denmark, Germany and Austria. The legal mandate on the function of the Commission for Regulation of Utilities and Gas Networks Ireland also needs to be amended to ensure they align with climate obligations and to prevent fossil fuel lock-in. In addition, an energy poverty Act should be introduced that defines energy poverty and sets legally bound targets, as per Scotland’s fuel poverty Act.

Brian Leddin (Limerick City, Green Party)
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I thank Ms O’Connor for getting through the statement in five or six minutes. I call Ms Murphy.

Ms Michelle Murphy:

From the perspective of Social Justice Ireland, income adequacy and building energy efficiency must be addressed in tandem if we are tackle the number of people and households in energy poverty and poverty in general. We know that the cost of energy was one of the main drivers of inflation up to March 2023. It accounted for a quarter of the annual change in the consumer price index. Looking at the five-year period since 2018, the price of electricity, gas and other fuels for home heating has increased by 102%. Absorbing such a price increase has an impact on every household. However, that impact is most acute for households on the lowest incomes, particularly those in the bottom 20% of the income distribution. This is because these households spend a greater proportion of their income. The also spend a greater proportion of this income on energy and food so they are most exposed to these price increases.

There is a significant concentration of individuals who are unemployed, long term ill or disabled, living alone and single parents in these bottom two deciles. Targeted measures to support these welfare dependent households will be an essential part of a policy response to energy poverty.

To look briefly at arrears, the most recent data from the CSO show that one in ten households are in arrears on a utility bill, with 7% missing two or more payments. However, if we look at households in deprivation, one in three are in arrears on a utility bill.

Regarding health status, one in five households with a person who is severely limited in daily activity - from a long-term illness or disability - failed to pay a utility bill on time at least once last year. These trends give an indication of the impact of high energy prices and energy poverty on low-income households. It is clear that adequate levels of social welfare are essential to address poverty and energy poverty. While the Government has introduced a number of very welcome packages, including budgetary measures to mitigate the impact of rising costs, they have failed to address the core issue of income adequacy as many of the measures have been one-offs.

We have consistently called for the benchmarking of core social welfare rates to 27.5% of average weekly earnings and a system of indexation to be introduced to ensure security and certainty for people on fixed incomes. In budget 2024, we are calling on the Government to increase core social welfare rates by a minimum of €25, to commit to a benchmark equivalent to 27.5% of average weekly earnings and to develop a pathway to index core social welfare rates to the minimum essential budget standard over a five to seven-year period.

Energy efficiency is the second pillar of addressing energy poverty. However, barriers persist for low-income houses in accessing grants. While we welcomed the announcement of the national retrofitting programme, particularly the free energy upgrade for households in receipt of social welfare payments, we are concerned that the upfront costs associated with the one-stop shop service and individual energy upgrade grant schemes remain a barrier to many low income households. Too often, subsidies are only taken up by those who can afford to make the necessary investments and end up functioning as a wealth transfer to households on higher incomes who can afford that investment, while the costs are regressively socialised among all users. There is a need to look at the barriers that are present for low-income households and how these can be addressed.

Many of the households experiencing energy poverty are in the rental sector and consequently cannot avail of some of the available schemes. For those renting in local authority housing, the Government must invest in a State programme of retrofitting to ensure those homes are fully retrofitted to the highest possible energy standard. In the case of the private rented sector, we agree with the recommendation of Friends of the Earth that the warmer homes scheme be expanded to include properties, if the tenant is in receipt of the housing assistance payment, HAP. However, eligibility should be contingent on the landlord providing a long-term lease to the tenant.

In addition, we call on the Government to integrate a building renovation passport scheme into the national retrofit plan. This should be fully aligned with existing BER systems and existing retrofitting finance.

However, it would facilitate a more step-by-step approach to retrofitting which could be more financially appealing and manageable for many households.

In summary, for Social Justice Ireland, the issues of income adequacy and building energy efficiency must be addressed in tandem to reduce the number of people and households in energy poverty.

Brian Leddin (Limerick City, Green Party)
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Thank you, Ms Murphy. The audio issues seemed to have worked themselves out during your statement, which I note you summarised. For the benefit of anyone looking back at the meeting, we will put the full text of all the opening statements on our website.

Darren O'Rourke (Meath East, Sinn Fein)
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I thank the witnesses for their opening statements. The concept of self-disconnection is well known at this stage. Do we know the numbers involved? What measures are the organisations present asking to be put in place for the coming winter for those with prepaid meters?

Ms Issy Petrie:

We have survey data from the Commission for Regulation of Utilities, CRU, from last year. There were still high prices so the survey reflected that, to some extent. I cannot remember the numbers off the top of my head but there were very significant levels of self-disconnection for gas and electricity customers. I can send the data on afterwards because we have it in our recent report that self-disconnections had increased significantly during the time of rising prices. This clearly reflected the trend of people simply being unable to top up the meter. The data were based on a small sample size so we would like to see another survey that really delves into the issue and clarifies that a drastic rise is clearly happening.

The survey also looked at the length of time that people were disconnected for. In some instances, people are disconnected for significant lengths of time. It is not just a matter of minutes or hours. This would also reflect what Society of St. Vincent de Paul members see with people having the meter off for days at a time. The issue of self-disconnection comes up very regularly when members are supporting people. We have a concern about prepaying self-disconnection for gas customers due to the limitations on the meters because they use older technology. Ahead of next winter, one of our priorities is to call for a working group to look into prepay meters and to assess what options are available to support gas prepay customers who are facing self-disconnection to get extra credits. They might have a standing charge debt built up on the meter. We want to establish what is possible and what needs to be done ahead of next winter because last winter saw a huge number of self-disconnections.

Ms Clare O'Connor:

From our own research, we found that the issue of self-disconnection needs to be much better researched. Much more direct action needs to be take by the CRU to prevent people from self-disconnecting by engaging with their suppliers. We also think that suppliers should be required to collect and publish data on self-disconnections.

Ms Susanne Rogers:

The figures are very difficult to come by because it is self-disconnection. That is a real issue. In Ballyfermot a couple of years ago, the Money Advice and Budgeting Service, MABS, did a piece of work. I appreciate that this work will not actually capture the increase in numbers that we have had in the last year or two but it is a good place to start. It is a very interesting paper. I echo the call for further research. MABS would have data that could be used.

The companies themselves would be able to see disconnections and for how long people were disconnected.

I echo the earlier call that arrears should be manageable. Many people are having prepay meters installed as a way of dealing with a high-arrears bill. It is either that or get disconnected. A certain amount of the top-up is going in arrears as well. That is really important. That needs to be managed. I do not like using the words "choice" or "decision". It is a real challenge to be able to do everything that needs to be done on €220 a week. I echo the research piece. Managing arrears on a prepay meter can push many people over the edge.

Darren O'Rourke (Meath East, Sinn Fein)
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I believe Ms Petrie raised the issue of a social tariff. Is a social tariff in place in other jurisdictions? How might that work?

Ms Issy Petrie:

There are social tariffs in use in different EU member states. In Belgium, the social tariff is decided at policy level every six months and pegged to the lowest available tariff on the market. That may have changed due to price rises; I am not sure if it may be used differently now. We regard this as a very important intervention on the cost side of things. It is a targeted intervention and a way of providing stability to a targeted group of households on means-tested social welfare benefits. It is another way of providing that stability and a guarantee of an essential service at an affordable level that can reflect, and be adjusted according to what is happening in, the market.

Darren O'Rourke (Meath East, Sinn Fein)
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Is it on the bill or the unit price of electricity?

Ms Issy Petrie:

There are different options. The different ways it could be done and their impacts would need to be assessed. There could be a discount on the overall bill rate, a discount on the unit rate or a discounted set of units as a block of energy use.

Richard Bruton (Dublin Bay North, Fine Gael)
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I thank the witnesses for the presentations. I am interested in the number of people in arrears and how that could be best addressed in policy terms. How successful is the exceptional needs payment in dealing with these cases? Are other interventions needed? The proposal to extend the fuel allowance to those in receipt of the working family payment seems like quite a sensible idea. They already have access to the free installation scheme, the warmer homes scheme. How many additional families would be embraced by that?

Low-interest loans could play a crucial part in the cost of retrofitting. Credit unions are well placed in the community, particularly if they are aligned to the suggestion of community energy advisers. Does that provide an avenue to those who are not covered by the warmer homes scheme?

There is an underlying difference of emphasis between energy poverty and the move to net zero. Obviously, energy poverty is greatest among those who have the worst BER. The warmer homes scheme is not predominantly aimed at deep retrofits. It is really aimed at energy poverty and improving the situation of those who are on low incomes and have bad heating systems. The witnesses seem to be unhappy with the approach the Government is taking.

It does seem there is a real effort to target, in that as the fuel scheme is a means-tested scheme it is confined to certain categories. Perhaps it excludes categories, such as the working family payment group. The SEAI schemes are targeted at people with a lower BER. Some people who get homes upgraded still get the fuel allowance. There is double paying these cases. The Government's approach is reasonably well designed. The witnesses seemed to suggest a different means-tested approach. Is it reasonable or sensible to ask for something new and completely different from what we now have, which is well established and people are familiar with, and go for a new means-tested approach with a social tariff? It seems to be quite a complex undertaking in the midst of a very intense period of crisis to try to redesign the entire system. Could there be marginal changes to make our system work better? That would seem to be preferable.

Ms Issy Petrie:

Between us we touched on various areas of data on arrears. There is the CRU data that has come out recently, which showed higher gas arrears and high numbers of gas customers in arrears. The electricity arrears data shows a concentration of electricity arrears among fewer customers but with stability or even an increase in the amount of arrears. It shows that some people are really struggling on the electricity side of things. Our concern is about finding solutions for people so there is no legacy of indebtedness that will continue this year and go forward to coming years.

The additional needs payment from the Department of Social Protection is a very important part of this. There have previously been issues about accessing the payment, how quickly the payment comes through and eligibility issues. On the energy side of things an important point as well as eligibility is how quickly the payment comes through. People are in a situation where they are negotiating with a supplier or they are prepaid customers who need the credit. There are issues with speed. I believe there have been some improvements in the speed of some of the energy payments. I do not have more information on this with me and I am happy to provide it afterwards. We definitely see the additional needs payment as a very important point of intervention for people who have significant bills and are struggling to top up.

For people in arrears it is about making sure they are connected and integrated with all possible sources of support as early as possible when they are in arrears. This includes being signposted to MABS. There is the issue of communication and engagement with suppliers and making sure people feel able and are able to speak to their supplier, have all the information they need to do so, and can access discretionary credits or hardship funds to reduce their bills and bring the arrears down as far as possible.

The issue that then becomes important is making sure repayment solutions are affordable and do not in themselves cause further hardship by being set at a rate whereby people cut back on something else to meet the repayment plan. This is something of which we are extremely aware. People might not have the heating on as much anymore, although some people will need heating. Repayments on arrears can themselves be an extra bill. This is an area where we need to see a policy direction and practice development from suppliers and the regulator as we go into next winter and deal with arrears from this winter.

We cost the fuel allowance and the working family payment as part of our pre-budget submission.

We have last year's figures and we will make our budget submission in the coming months.

We see the social tariff as going very much hand in hand with the fuel allowance. The fuel allowance is about protecting people's incomes and the social tariff is about ensuring there is affordablity and stability on costs. We very much see them working in partnership. While we do not think it is a simple thing that can be rolled out in weeks, it is an important mechanism to have. One thing that has been clear in the past year or so of the price crisis is that is very important to have these mechanisms in place for when we need them. They take time to put in place and their different implications and possibilities need to be teased out but they become tools to reach people in a targeted way when we need to do so. We need to do so at the moment, so that exploration needs to take place.

Ms Clare O'Connor:

Deputy Bruton's suggestion on low-interest loans from the credit union is a good idea. I would go so far as to propose zero-interest loans, which have been introduced in low-income households in Germany and the Netherlands. On expanding eligibility for the free retrofitting schemes, we are suggesting that tenants on the HAP payment be included in the warmer homes scheme on condition of a long-term lease being offered. There is still a large cohort of households which are not able to access these schemes. Ultimately, the success of climate action and any of the transition will hinge on public acceptance and buy-in. It is really important that the public perceive this as a fair transition. It is also important that we include as many households as we can in the warmer homes scheme and prioritise those who are in the least efficient homes.

Richard Bruton (Dublin Bay North, Fine Gael)
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The warmer homes scheme is really for people who receive the working family dividend or are in the fuel scheme. It gives priority to the worst affected. There seems to be criticism of the scheme but it seems to me to be pretty well targeted. We can always say it should scale up but when a scheme is free, there will be a lot of people queueing to get it. It is a very generous scheme.

Ms Clare O'Connor:

Overall, it is a really progressive scheme compared with many of the other schemes across Europe.

Ms Michelle Murphy:

Credit union loans could potentially be an answer for a particular cohort of households but one must consider their capacity to take on and repay additional debt, the timeframe for repaying it and whether there would be a State guarantee for such a scheme. It has the potential to play a role for households, however.

On making retrofitting attractive to households, there may be unforeseen costs for households. One additional cost would be having to move out during the process if additional work needs to be done inside the home once the retrofit is complete. There may be other supports available for households but that is where the community energy adviser role comes in. It is to make the households aware of what additional supports are available. Another issue is addressing how this could be done in a more co-ordinated manner.

On arrears, the additional payments are in place but looking at arrears overall, we also need to examine income adequacy and how often or regularly households are falling into arrears and their capacity to meet the arrears repayments. As the Society of St. Vincent de Paul pointed out, that is an additional bill so then there is a question of what else these households are cutting back on in order to meet arrears repayments.

Ms Issy Petrie:

This is the sort of service we have been advocating for for a while but it has become very critical at the moment and will only get more important as climate action continues, and the energy landscape changes. We see this as a clear priority and an urgent innovation we need to see at the moment. There are a few different ways it could work. The priority for the Society of Saint Vincent de Paul is that it is local and tailored. There has to be an element of flexibility in meeting the person where they are at within the service. That is why it is so important that it is local and embedded in the community somewhere so that people know where to go to access support and people can be connected in and reached out to within the community. It could work in a number of ways. Some of the key bodies that would need to be included are local authorities, the SEAI, the local MABS office, the local social welfare office, different kinds of housing providers and electricity suppliers. These are all the different bodies that could be included and the community energy advisers would link into these.

In terms of who leads it, there are different ways that it works elsewhere. There are a few different models in particular that we have looked at in the UK. There is a service in London that sits within a local authority but is accessed and works across different local authorities but the expertise is within one local authority. There are situations elsewhere where it sits within a community organisation, so there are options.

Ms Issy Petrie:

I am not sure I can answer that in terms of the numbers at the moment. I do not know whether Social Justice Ireland has those figures or would be able to answer that? I am happy to look at what we have and come back to the Senator.

Ms Clare O'Connor:

A long-term lease would be five to ten years plus, ideally. What was the Senator's first question?

Ms Clare O'Connor:

I might come back to the Senator on that report if that is okay.

Ms Clare O'Connor:

On the fully funded energy upgrade scheme specifically for people who are renting, we really need clarity on the minimum energy performance standards, which were announced under Housing for All to apply from 2025. We have no clarity as to what the minimum BER will be or what supports will be in place for landlords. A total of 70% of landlords in Ireland are single-property owners. We would like to see regulations brought forward such that multi-property owners are obligated to meet the minimum BERs first, giving a little more lead-in time for single-property owners. A consultation was done a couple of years ago by the Government on how to address the issue of the split incentive, whereby landowners do not have incentives to act on this issue. I understand there has not been any action in this regard since then. We would like to see action on the consultation that was done.

Jennifer Whitmore (Wicklow, Social Democrats)
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I thank the witnesses for attending to discuss the issue of energy poverty. It is a really important discussion to have at this time. We tend to have the discussion in September, October and November when people are really in the throes of it but the preparatory work needs to be done now to address the issues people will face in the coming winter.

Following on from Deputy Bruton's point, I am concerned about the levels of moneys owed and that people will not have cleared the debt they incurred last winter. I assume energy prices will still be very high this coming winter. People will be going into it with a huge debt already. What levels of debt are the witnesses seeing and how many of those who come to them are carrying debt on energy bills? That question is primarily for Ms Petrie.

Ms Issy Petrie:

The Society of St. Vincent de Paul certainly share the Deputy's concern. Without further intervention, the size of the bills people are getting means they will be going into next winter with those repayments hanging over their heads. We are seeing bills in the high hundreds of euro or more, including some in the region of €1,000. A particular concern is the multiple bill cycles coming through from last winter. A bill of €600, say, would previously have been very unusual but is now becoming a multiple occurrence for people. That leads to an insurmountable mountain of arrears. It is urgent that this issue is tackled now in order to assist the people who are likely to be the least able to pay off their arrears or who might have the highest energy needs for various reasons, whether that be the energy inefficiency of their home or because of health needs. There is a concentration of these really significant levels of debt among people who are least able to afford it.

It is difficult to say how many people are coming to the Society of St. Vincent de Paul with these very high levels of debt. Requests for help with energy bills went up last year and increased significantly again in the first quarter of this year. They are split between prepay customers, a lot of whom we hear from because of the urgency of their situation, as well as people faced with really big bills who need somewhere to turn for support. It is hard to give an exact figure.

Jennifer Whitmore (Wicklow, Social Democrats)
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I am not sure whether suppliers have guidance on repayment plans. When they are working out how much people can afford to pay, is it often the case that their calculations are more than what customers actually can afford? Are the repayment plans forcing people to pay for energy while leaving food purchases behind? Can the plans be aggressive in their nature?

Ms Issy Petrie:

It is different across the market.

It is not that one size fits all but we are definitely concerned that repayment plans that are negotiated are sometimes not appropriate or affordable. We really welcome the new regulations brought in by the CRU in the autumn of last year on having to offer a minimum period of 24 months in repayment plans. We see this as the start and would like to have seen more development. Going into next winter, we need to go beyond the idea of a minimum length and say the plan has to be affordable. There are principles of affordability in the supplier handbook but they are quite vague and, therefore, there needs to be much more development of what we mean by affordable to ensure more uniformity in how the assessment is made across the market.

We would definitely like to see more monitoring by the regulator and more data on the repayment plans. I think we have data on how many payment plans there are, how many are kept and how many are broken but I am referring to data on how long the payment plans are agreed for and the levels at which they are set. We would obviously like much more but these data would allow us to tell what is going on with the repayment plans and where things are going wrong or right. In this way, there would be oversight allowing us to build on best practice.

Ms Susanne Rogers:

I want to come in on the point on repayment plans. As Ms Petrie pointed out, traditionally they would have been stretched out over 12 months and no longer, putting people in genuine difficulty. Let us consider how far €220 per week will go in putting a roof over your head, putting food on the table, paying the heating and lighting bills, buying clothes, shoes and haircuts, paying for transport, the television licence and the bin tax, topping up your mobile phone and perhaps paying bank charges. People might have been putting €10 or €15 per week into the post office to manage their bills, but when they received massive bills it meant the volume of energy they were using was not covered by these weekly payments. In this regard, let us consider the circumstances of somebody who is €300 in arrears, built up over two bills. The energy companies generally do not let such a person go past two uncleared bills. After two, he or she is threatened with disconnection. The companies try to spread payments out over 12 months. Even arrears of €300 amount to an extra €5 or €6 per week. Considering that people might be on €220 per week, that is €5 or €6 on top of what they are already trying to pay. For many on a low income, even if they use the smallest amount of energy they can get away with using, it is still more than they can actually afford. While there is now a provision to spread payments out over a longer period, I echo Ms Petrie's view that this needs to be examined. We must ask whether a person can afford an extra €2 or €3 per week. If it takes the person a couple of years to clear the arrears, that is fine. Generally, where somebody has had three plans in a year, the company might not offer a fourth. It puts people under enormous pressure because if they do not sit within the plan, they get disconnected. That is how these things work. They must agree to the plan or have their supply cut off. This puts pressure on them to agree to plans that may push them to the edge such that, although they think they might be able to manage, one little knock or event in the 12-month period to Christmas could put them back to square one. Therefore, the companies need to be a little more creative in how they manage arrears without putting people out after two strikes or pushing unmanageable repayment plans on people that result in disconnection if not accepted.

Bríd Smith (Dublin South Central, People Before Profit Alliance)
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I thank the witnesses for their presentations. The figures jumped out at me. The stark reports are very important and useful tools for anybody making an argument around the various questions they raise. The first point is obviously that the one-off measures the Government took in the latest budget, although welcome, did not solve the problem.

Many of us argued at the time that the approach would not solve the problem. We also see the gap between those who have and those who have not widening. Some of the figures are stark. The Society of St. Vincent de Paul gave us the statistics of approximately one in five single parents, those out of work with illness and disability and those unemployed being unable to afford to keep their homes warm enough who now have serious arrears. I do not know how the Society of St. Vincent de Paul is keeping up with the 40% increase in demand and calls. This is a stark increase in recent times. It does not, however, surprise us.

I have some questions. On the pay-as-you-go system, Ms Rogers mentioned the Ballyfermot MABS report that came out a few years ago. It was a valuable report and it flagged even before the energy crisis that the pay-as-you-go system was very tough on the poor. One of the issues MABS was pointing out then was that people in that situation also had to pay an extra charge to the companies providing the pay points in the various shops and charges to some of the shops. People in this situation therefore are always being penalised and held back. I know people who do have to go without energy. The witnesses have described very well how people cannot manage on incomes that have not kept pace with inflation.

On the recommendation regarding income adequacy, social welfare rates have to keep pace with inflation. I would argue as well, however, and I think the figures show this too, that some working families on low pay also need pay increases. This is not just about always subsidising them but about giving them a realistic amount that will enable them to deal with all the other issues mentioned in addition to energy, including increasing rates in this regard.

The other aspect that stood out for me was how renters are affected. When we think about this situation, there is a double or triple whammy for them. Their rents go up all the time. Rents have gone through the roof and now energy costs are now also significantly impacting them. Generally, the quality of BER ratings in many of rented homes is very poor. Have any of the witnesses examined the issue of district heating and the situation of those who live in areas with those systems? Some of these people may be better off and may not be coming to the attention of their organisations, but there are also bound to be some people who just cannot afford keep up with the costs involved. I say this because these systems charge a much higher rate than the gas companies and it is not possible to shop around. People are stuck with the one provider. Has this issue been encountered?

What role is it thought that the carbon tax has played in dealing with this issue? We have been told time and time again by those who advocated increasing this charge that the revenues would be parked to help the retrofitting programme. From the figures in this regard again, however, we know it is again the least well-off who are least able to access the grants to retrofit their homes to bring them up to the necessary BER ratings. The representatives of Social Justice Ireland made the comparison with the subsidies on fossil fuels and specifically the kerosene jet fuel tax revenue that is foregone. Losses suffered by the State in this regard greatly outweigh what is taken in by the carbon tax. Here is another example of social discrimination that we should deal with.

The witnesses spoke about the need to reform the CRU and Gas Networks Ireland as well. Will they please elaborate on this point?

Brian Leddin (Limerick City, Green Party)
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I thank the Deputy. The first questions were for Social Justice Ireland.

Ms Susanne Rogers:

I will take the subject of district heating and then pass over the subsidies aspect to my colleague.

Brian Leddin (Limerick City, Green Party)
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That is fine.

Ms Susanne Rogers:

As the Deputy said, district heating does not come up that much. From what I have read and seen mentioned about this topic, though, I have gathered that people are locked into this system because it tends to be used in landlords with multiple properties. When we spoke about landlords previously, the majority of them owned one property. These heating systems, however, tend to be found in massive apartment blocks and people are locked into higher rates for heating charges. I have not seen any suggested policy solutions to this issue yet, but I will definitely make a note of this issue and I will send on any information I find.

We need to be careful even with the conversation about heat pumps. I have been speaking to a couple of people recently who said a heat pump will operate differently in Donegal than in Cork. Much of it is about the temperature of the air that is taken in. We need to be careful about conversations that we have in that the heat pump is not the answer to everybody, everywhere all of the time. We need to be careful. It needs to be properly set up for the place it is in. There was research done that looked at four separate areas – I think Leinster, the west coast, Donegal and Cork. There were 100% differences in the efficiency of the heat pump depending on where in the country it was being used. Things such as district heating and heat pumping are still quite intricate. We still need to look at them on a case-by-case basis, which is the worst answer anybody can give to anything. It depends. We need to be careful when we are installing things such as heat pumps into low-income households because sometimes the bills can actually go up. We need to be careful of that.

Brian Leddin (Limerick City, Green Party)
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I thank Ms Rogers for that. I will move it along because there are quite a few questions and we have limited time.

Ms Michelle Murphy:

We were clear at the time that one-off measures will not work. That is why we are very clear on the issue of benchmarking to 27.5% of average weekly earnings, a €25 minimum increase in core welfare rates and then indexation to the minimum essential budget standards.

On the issue of subsidies, we have been supportive of the carbon taxes and the carbon taxes increases. However, we said that mitigating measures needed to be put in place for low-income households and we have not seen them to date. One issue that we have consistently highlighted is the issue of the fuel allowance and looking at the OECD recommendation to de-link it from fossil fuels and expand eligibility. Targeted policies that can support different households at different times between now and 2030 will be needed. Environmental subsidies and the issue of jet kerosene are key. There is certainly a role for this committee to be looking at those subsidies and for the Government to look at which subsidies are aligned with our climate goals and which are not. Subsidies provide a wider fiscal space to the Government so it does not have to introduce new environmental taxes or levies. It can simply use the fiscal space available within those subsidies and invest that money into supporting households that are in energy poverty and into funding a just transition. It gives much more budgetary space.

I am aware that the issue of jet kerosene requires agreement on the EU level and beyond. We have been consistent in calling for an aviation tax in the interim period and we will be calling for that again in our budgetary proposals to make that industry make a contribution to our climate targets. Given the discussions we have around the other sectors - other parts of transport, agriculture and the housing sector, for example - every other sector is making a contribution. There should not be a sector that is not making a contribution, given the polluting nature of that sector.

Brian Leddin (Limerick City, Green Party)
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Does Ms O'Connor or Ms Petrie wish to come in?

Ms Clare O'Connor:

I can come in on the carbon tax. We agree with Social Justice Ireland. I reiterate the need for proving access to retrofitting and renewable energy supports for people who are feeling the impact of the carbon tax most acutely.

Will I move on to the question on the CRU and GNI? Okay. Yes, that was us who looked at the public mandates of GNI and the CRU. For GNI, we want its goal that relates to promoting fossil gas use and expanding gas infrastructure to be removed and we want to ensure that all gas demand scenarios correlate with the net zero 2050 target and any other interim targets as well. We need GNI to produce a strategy that addresses a phase-out of new domestic and small business connections and a reduced gas demand from these customers. As well as that, we need to see a medium-term rule for fossil gas for electricity generation, the issue of stranded asset risks addressed and the decommissioning of the gas infrastructure.

On the CRU, it is important that it is enforcing any provisions that were announced last December in the energy poverty action plan, specifically the provision that vulnerable customers should be moved to the most economical tariff and permitted to access bill pay regardless of credit access. We have done further research on amending those mandates and we can send that to the committee afterwards.

Brian Leddin (Limerick City, Green Party)
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If Ms O’Connor can send anything like that to the clerk, who will then circulate it to all the members, we would appreciate that.

Ms Issy Petrie:

I will touch on district heating. We have members who are supporting households in group district heating schemes who have been exposed to these much higher rates of heating because of exposure to the commercial rate side of things.

Members are supporting these households but I do not think there is yet that kind of adequate financial solution, whatever it may be, to mitigate against this extra exposure these households have during the price crisis. Households have been shouldering these bills so that has led to greater levels of energy poverty and deprivation for households on low incomes. In that situation, additional needs payments have a role to play in meeting extra costs but I am sure there are other financial interventions that could be put in place. It is really important that these households are brought into standard domestic consumer protections. Currently, they are not covered by the same consumer protections as gas and electricity customers in terms of negotiating arrears repayments or registering as a vulnerable customer so they cannot be disconnected and need that extra level of support. They need to be urgently brought into these standard domestic consumer protections.

This speaks to a wider point about seeing what is coming down the line for consumers, spotting these things before they happen and preparing the consumer protection infrastructure and anything else that needs to be prepared in advance so that when these situations occur, we can respond to them quickly. It is a similar situation with heat pumps in that we are also seeing people with high costs from heat pumps. Our recommendation is for a consumer advocacy agency that has a remit to identify how technology and the market are changing and where this is going to intersect with consumers' experience, particularly more vulnerable consumers' experience; and to engage with the regulator and policy to prepare in advance for these situations.

Bríd Smith (Dublin South Central, People Before Profit Alliance)
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Does Ms Petrie think the pay-as-you-go system should be reviewed as something that is not advisable? Would it be better to see more people on a plan and with supports and a better income instead of using the pay-as-you-go system? I suspect that many of the people who come to the Society of St. Vincent de Paul are using that system and that is where the trouble starts.

Ms Issy Petrie:

A lot of people use pay-as-you-go. There are different types of pay-as-you-go. There is the hardship pay-as-you-go to manage arrears and what is referred to as a lifestyle pay-as-you-go where it is someone's choice because that is how he or she wants to budget. The reality, however, is that pay-as-you-go is an entirely different thing when prices have doubled. The risk it presents to people has increased so much. Having said that, the Society of St. Vincent de Paul has previously supported people who were self-disconnecting and severely self-rationing so it is not a new problem but the risk is so much greater with prices as they are.

What this has really brought to light is the focus that needs to be placed on this group in terms of consumer protections and understanding those risks. In terms of the capabilities of the meter and getting help to people, where are the weaknesses in the system when we are seeing so many prepay meter customers self-disconnecting and falling through the cracks of these protections? It is about taking this opportunity to review how we can support those customers.

Alice-Mary Higgins (Independent)
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I thank the witnesses for their interesting presentations. Looking at a few points highlighted by Friends of the Earth and other groups, in terms of the national retrofitting plans and the scheme, under which it is planned to upgrade 500,000 homes to a B2 energy rating, I understand that the plan is that only 36,500 of these homes, or less than 10% of them, would be local authority-owned homes. The presentations from Social Justice Ireland and Friends of the Earth indicated we need to shift that target and that the balance needs to be shifted more towards local authority-owned homes because they seem to form a very small part of the plan.

Again, while you are creating an incentive in the market relating to some, those are presumably homes where the State could be acting far more quickly and far more effectively. Would that really help in terms of front-loading the addressing of the energy poverty piece?

In respect of the rental sector, we have heard questions about how we incentivise. How do we press landlords on this issue? I know Friends of the Earth have mentioned a minimum BER. That could be combined with protection against eviction. How can we look to protection for Part 4 tenants combined with a requirement that anything coming to market or being upgraded has a minimum BER? Could the witnesses comment on those issues?

In terms of people on prepay meters, what percentage of them are in rental accommodation? They do not have the ability to control the energy rating of the environment in which they live. Is there much of an overlap between those relying on prepay meters and those in private rental accommodation?

I welcome the comments about jet kerosene, which is the very large elephant in the room. This brings us back to the idea of levies and who is paying and contributing. There is a solidarity contribution coming down the tracks. This committee heard from Ms Sikow-Magny from the Commission that it should be targeting SMEs and vulnerable households - those who are suffering most at the moment. How should that be targeted, given that it is a solidarity contribution rather than a general revenue measure and is meant to be targeted in an effective way?

A comment was made in two different presentations about the need for more engagement on community energy advisers and more engagement with civil society by the SEAI and the energy poverty steering group. Has there been much engagement with the witnesses' organisations in respect of this windfall tax, the decisions Ireland has made around the transposition of that tax and how that money should distributed effectively to target the most vulnerable?

Ms Clare O'Connor:

We agree that the retrofitting of social housing units needs to be front-loaded. Social housing should make up a really large proportion of the 500,000 homes that are to retrofitted to B2 standard by 2030. We have been calling for this for the past year and a half. In September, 42 other civil society organisations across housing, poverty and the environment were very much in agreement that this should be front-loaded. This is one of the reasons we are asking the committee to write to the Minister for Housing, Local Government and Heritage to ask for increased funding for the local authority energy-efficiency scheme.

Regarding protections for tenants, again, it comes down to a lack of clarity on the retrofitting of the private rental sector. This is why we are asking the committee to ask the Minister for Housing, Local Government and Heritage for a policy statement with a clear timeline for the introduction of minimum BERs and clarity on protection from evictions, or "reno-victions" as they are called, for tenants in the private rental sector.

In terms of engagement with NGOs on the windfall tax, we have not had any engagement from the Government on the windfall tax or the temporary solidarity contribution but we would definitely welcome having input into that. In particular, organisations such as the Society of St. Vincent de Paul, which deals directly with people in energy poverty, should be consulted.

Brian Leddin (Limerick City, Green Party)
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Regarding minimum standards for rental properties, the Minister for Housing, Local Government and Heritage will appear before this committee in about a month's time. It would be good to look for clarity from him at that meeting.

Ms Issy Petrie:

I can touch on a couple of points.

We published a report with Threshold a couple of years ago, which sets out our priorities in this area. Obviously at this time we are incredibly aware of the situation in the private rental sector and the associated sensitivities. Our priorities are the extension of free upgrades to tenants who receive the housing assistance payment conditional on a long-term lease, and the supports that are available to landlords. The latter is a priority because we recognise the situation for smaller landlords for whom doing a retrofit is a significant investment. One of the things we would like to see is a private rent-ready one-stop-shop that caters for landlords. An extension of free energy upgrades to HAP tenants would also touch on the carbon tax issue, as would the equitable mitigation of the impacts of the carbon tax and how far that reaches into private rental tenants. Extending the upgrades to private rental tenants in receipt of HAP would go some way to mitigating the carbon tax for those tenants.

On prepay meters in the private rental sector, I am not aware of figures that show how that overlaps. Obviously many private rental tenants have prepay meters. Sometimes prepay meters are pre-installed in a private rental house so it is not a choice for the tenant. Even if it is not a hardship meter, the tenant is exposed to the risks associated with a prepay meter. It is not his or her choice to have a prepay meter but I am not aware of any figures on that.

Ms Michelle Murphy:

On retrofitting plans for homes owned by local authorities, in our submission we advocate for this to be significantly increased. It would be a very productive way for the State to begin to meet its climate targets. Local authority homes are owned by the State and retrofitting would increase the value of that asset. Also, I am sure retrofitting could be done at scale given the knowledge attained by local authorities. One of the issues around retrofitting is the ability to scale it up, thus reducing costs. Local authorities should be in a position to do this. Retrofitting should be a priority for the Minister for Housing, Local Government and Heritage because not only is it going to reduce emissions, but it will also increase the health outcomes for those households while addressing the issue of energy poverty within local authority households.

We have not had any engagement on this solidarity contribution. We are concerned about that given the lack of consultation on the packages to date. Also, a large volume of resources has been spent on a one-off credit. We have pointed out, like the ESRI, the OECD and others, that it was not well targeted. As I have pointed out, for that volume of resources, a lot more could have been done for those households that are in the bottom 20% of the income distribution and are being most impacted. Obviously the tariff will not be ongoing as the expenditure is a one-off. We would hope that there would be engagement with the sector, and with organisations working with these households and families, to look at how best to use this money. We do not know what the split will be between SMEs and households but there needs to be a better way to do this than just a one-off credit for households.

Alice-Mary Higgins (Independent)
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A sum of €40 million of public moneys from the EU Recovery and Resilience Facility has gone into the de-risking of loans. That really points to the need to have that trickling through on loans. Perhaps our guests, when answering other questions, might reply to my question about the exit from gas boilers and the need to ensure we are not locked into the price volatility of gas.

Brian Leddin (Limerick City, Green Party)
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I apologise to the Senator for cutting across but I want to be fair to Members and Deputy Farrell is next.

Alan Farrell (Dublin Fingal, Fine Gael)
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I thank our guests for their contributions and I note that we have had a thorough discussion.

I wish to follow up on what Senator Higgins said about locking in fossil fuel boilers into retrofitting schemes. I have raised the same point at committee meetings and in the Dáil. I would like to see steps taken to remove fossil fuel boilers from schemes.

I am not an engineer but I picked up on a comment that Ms Rogers made about research on heat pumps. I have read similar research but invariably the cause is poor installation as opposed to a failure with the heat pump which, unfortunately, has caused extraordinary reputational damage that I have seen in other reports relating to the UK. I agree with the sentiment expressed that we must remove fossil fuel boilers from schemes to retrofit homes and-or new homes.

A lot of what I wanted to discuss has already been touched on so I would like to ask Ms Petrie questions on self-disconnection. Frankly, I find it galling that energy providers charge customers a premium for using prepaid meters when prepay users remove the risk from arrears because they clearly cannot go into arrears; this is targeting of the most vulnerable people who find themselves in that situation with a prepaid meter. I am very concerned about self-disconnection, as is the committee which has raised the issue many times recently. I agree with Deputy Bríd Smith, which is a rare occasion, that we should remove them from the market. I do not think that they serve a purpose other than to ensure that those who are most at risk of energy poverty continue to be most at risk even with the best will in the world shown by the State in providing supports either directly or, as has been requested at this meeting, on a targeted basis. Do Ms Petrie or any of the other panellists wish to comment on that aspect?

On arrears experienced by low-income families, are our guests aware of a repository of information that allows them or Members of the Oireachtas to identify the level of arrears other than through the CRU?

Finally, on low-income families having access to renewable electricity or energy, yesterday I attended a launch by EnergyCloud and Fingal County Council of a scheme, which is supported by SSE Airtricity, to target social homes in Fingal with excess wind energy that, heretofore, was wasted. A target has been set to roll out the scheme to 10,000 homes by the end of the year. Is the Society of St. Vincent de Paul considering the scheme? Perhaps the other panellists will comment on that.

Ms Issy Petrie:

On self-disconnection and challenges faced by customers with prepaid meters in terms of the additional payment some users must pay to use their prepaid meter, the situation is different for customers who have a hardship meter. I refer to those who pay back arrears through their meter, which is called a lifestyle prepayment meter. Our particular concern about the additional charge is about the people who have chosen to use a prepaid meter because it is currently installed in their home and they have no choice or way to avoid the charge. For connected customers using prepaid meters who find themselves in difficulty with their energy costs, we would like to see that additional charge removed and for them to be offered comparable and the most economic tariffs as hardship, prepaid meter customers. This is one aspect of a wider poverty premium that can appear in different ways in the energy market. It is definitely worthy of further research into, and consideration of, all the different ways that the poverty premium appears, whether that is through not being able to access reductions that come with a direct debit or online billing.

There are plenty of different ways the poverty premium appears, and this is one of them. That is a concern for us.

As for arrears and data other than from the CRU, there are the CSO SILC data, but there is the time lag there. I cannot really think of any other route as contemporaneous data but I can look back through what we have written and so on and come back to the Deputy.

Was the last point about EnergyCloud?

Alan Farrell (Dublin Fingal, Fine Gael)
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Yes.

Ms Issy Petrie:

I think my colleagues have heard more about that. It certainly seems like an important innovation and an important way of getting that excess heating capability to people.

Brian Leddin (Limerick City, Green Party)
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Thank you for that, Ms Petrie. Ms Murphy, do you wish to come in there?

Ms Michelle Murphy:

Yes, just briefly, on a point Deputy Farrell made about the installation of the heat pumps, which is really important. I certainly think there is a role for looking at the labour market itself, regional imbalances, apprenticeships and our long-term training strategy. It is hoped there will be a huge roll-out of heat pumps, so the questions are whether we can provide on-the-job training to local people to ensure that is done properly and what role, for example, the Department of Further and Higher Education, Research, Innovation and Science, SOLAS and community education providers have in doing that and addressing the key issue Deputy Farrell pointed out. We then have this unhelpful narrative developing. I certainly think there is a role for the Department of Further and Higher Education, Research, Innovation and Science and others involved in skills development to look at this because we need to consider the issue and the whole issue of meeting our climate targets and the labour force that is required for that. Certainly, there is space for this committee to look at that.

Alan Farrell (Dublin Fingal, Fine Gael)
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I thank Ms Murphy for that remark. To be fair to both the Department of the Environment, Climate and Communications and the Department of Further and Higher Education, Research, Innovation and Science, there are retrofitting technology facilities around the country, and we are establishing more of them, but this is a point that often comes up when I talk to people in my community or constituency about retrofitting - the fortunate ones who have the capacity to have retrofitting carried out. They express concern about heat pumps on the basis of stories about poor installation, so it is definitely something we need to look at.

From research done by their organisations, are the witnesses aware of prepay meters having been removed in any other jurisdiction and, if so, whether it had a positive impact on the number of homes that were exposed to energy poverty?

Ms Michelle Murphy:

Not that I am aware of.

Ms Issy Petrie:

I am not aware of any sort of widespread removal of prepay meters. I do not think I have heard of that.

Brian Leddin (Limerick City, Green Party)
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Ms O'Connor, did you want to come in on the previous point?

Ms Clare O'Connor:

Yes, it was on heat pump installation. We are advocating for introducing obligations on installing renewable heat solutions from 2027 at the latest, ideally earlier. It is important that those signals are sent out now to the market, and to people who are training and reskilling and installers, and that industry is aware that this is coming down the line. It is very important that there are people here in the Oireachtas championing the need for legislation and regulation in that area.

Brian Leddin (Limerick City, Green Party)
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What would they be? Would they be the building regulations on heat pumps?

Ms Clare O'Connor:

It could be done through building regulations. That is one way. Austria has introduced a renewable heat law through primary legislation. In the Netherlands and Denmark, it has been the building regulations. I am trying to remember what Germany has done but, yes, building regulations are one way. Primary legislation could be positive because the issue of the gas grid connections could be brought into that as well.

Brian Leddin (Limerick City, Green Party)
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Thank you for that. Is that in your report?

Ms Clare O'Connor:

Yes.

Brian Leddin (Limerick City, Green Party)
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We will have a look at that.

Lynn Boylan (Sinn Fein)
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I thank everybody for their contributions. It is important, as others have said, that we are discussing energy poverty around climate action as well.

It is a real blind spot for many policymakers and even media to draw the parallels between the two in that if we are not reducing our emissions and our energy poverty, we are just transferring wealth. That might have been in Social Justice Ireland's opening statement.

I would like to focus first on looking at how we measure when we are taking climate action, particularly in respect of retrofitting and renewable energy, and ensuring we are capturing what the impact is on reducing energy poverty as well. The Department of Public Expenditure, National Development Plan Delivery and Reform report from 2018 highlighted the fact that we do not have those data and, therefore, when homes are retrofitted, unless they are covered under the warmer homes schemes, household income data or the energy used by those availing of the grants is not being captured. I would like to hear the views of all the witnesses as to how important it is that we start collecting the data around household income and energy poverty levels when we are giving such large amounts of public money to retrofit.

Another thing I wish to focus on, which I think Ms O'Connor touched on, is the Danish model and heat pumps. Maybe the witnesses can send on more information as to how different jurisdictions are doing that.

The other point is about switching suppliers. There has been lots of talk about the CRU needing to monitor self-disconnection and to have greater transparency and greater information for us all in this area. However, one of the issues that was flagged in the old energy poverty report was the barriers to people switching, whether it is that older people do not like direct debits or whether it is the capacity to spend, or even just having the time to spend, hours on a phone dealing with a supplier to switch. Are there any recommendations there that we need the regulator to look at to make it much easier for people to switch, while also identifying those barriers and how we can help those people to switch supplier? While there is not much value in switching in the market now, we know that will change and it is an important way for people to reduce their bills.

Ms Clare O'Connor:

Data collection will be a really important part of the retrofitting scheme going forward, particularly for the energy poverty retrofitting schemes. It will be really important that we know by how much energy poverty has reduced, but we do not currently have an effective definition of "energy poverty", so that is one thing we need to work on as soon as possible. The energy poverty steering group has been set up as part of the energy poverty action plan. Part of its work will be setting a definition of "energy poverty". We have a concern that currently no civil society or NGO is represented on that steering group. It is important that they are part of that conversation on defining energy poverty. Also-----

Lynn Boylan (Sinn Fein)
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I am sorry. Did Ms O'Connor say there is no energy poverty representative on the energy poverty steering group?

Ms Clare O'Connor:

There is no civil society representative. We need to see an energy poverty Act that defines "energy poverty" and sets legally binding targets for reducing it. Part of that could involve collecting data on the warmer homes scheme to see the impact of that.

I can send the committee more information on the Danish rebalancing of heat pump bills. It is an interesting issue we should look into.

Ms Issy Petrie:

I will just touch on the supply switching aspect. As the Senator said, there are more barriers to switching, particularly for households in energy poverty. There are gains from switching as well, such as the discounts for direct debit customers and online management. Switching can also feel more like a risk if people know that their energy costs and wider finances are in a precarious situation. Then switching feels like a bigger risk for them than it might be for other people. They might have built up a relationship with their supplier or feel confident that they know how to manage their costs with their supplier. That is one element. This is one area - I am sure there are other interventions as well - where community energy advisers could have an important role in providing that one-to-one tailored support. We know that people find bills hard to navigate. Bills have a huge amount of information on them without people having to look at different suppliers and information between different suppliers. We think community energy advisers could be a good targeted way of reaching people in energy poverty and increasing their confidence and increasing the kind of information they have as to how to navigate the energy market to get the best deal for them.

Having said that, switching is never going to be the whole solution for people in energy poverty. As Senator Boylan said, there are fewer gains to be had from switching at present. There also need to be other tariff interventions and other interventions to make sure there is protection.

Lynn Boylan (Sinn Fein)
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I want to pick up on this point and ask the witnesses their view on the standing charge and whether the CRU needs to have greater powers over it. Once again, whether people are reducing their energy use for efficiency reasons or because they cannot afford not to do so, they are punished by the fact that the standing charge is increasing as they are reducing their energy use. Would the witnesses support changing this to allow the CRU to have greater powers to regulate it?

Ms Issy Petrie:

Yes, we would like to see that.

Ms Clare O'Connor:

We would support that too.

Ms Michelle Murphy:

Absolutely, and there is a role for the CRU in looking at the issue of the poverty premium in general. It goes back to the point made by Deputies Bríd Smith and Alan Farrell on the prepaid meters and whether they should be phased out. I do not like the term "lifestyle meters" because people do not have a choice. There is also an age premium and a premium just because people do not have the capacity to go online and are prevented from getting some of the savings from switching. I echo the point that incremental fees need to be addressed. Switching will not fix this.

With regard to how to measure the data and the impact of retrofitting on energy poverty to date, we do not have a good way to do this. There is a role for the Department of Housing, Local Government and Heritage and the CSO in this. Two months ago, the Parliamentary Budget Office published an interesting document on climate budgeting and examining the allocations in the budget that go towards climate action. We do not measure their impact even through Departments. The document makes good suggestions on how this might be improved. Certainly this is something the committee could consider. There are some straightforward suggestions in it for Departments and public bodies on measuring the impact and the outcomes and looking at the amount we are putting in. We should be able to measure the increase in retrofitting and reductions in energy poverty.

Ms Susanne Rogers:

With regard to data and looking at the impact of retrofitting, Dr. Shane Colclough of UCD has done research on a small housing estate in Waterford. He looked at a group of houses retrofitted by the local authority and the impact this had on the households. It is not only about energy poverty. He noted that bills were lowered and people had warmer homes but there was also a massive impact on mental and physical health and on general household wellbeing. This is wider than poverty when we look at the amount we have to spend to keep our homes warm. With regard to heat pumps, he noted that it is about getting the settings right. We are concerned that households should not need a degree in engineering to get the settings right. It is an acknowledgement that heat pumps are the way to go but they need to be fitted correctly. The benefits definitely outweigh the financial input and this needs to be taken into account.

Brian Leddin (Limerick City, Green Party)
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I want to ask about the tension between addressing energy poverty and decarbonisation. Earlier, we spoke about the carbon tax. The view is that carbon tax is important but it should be fairly redistributed. The balance of social homes are to be retrofitted by 2030 and 10% of the 500,000 homes will be retrofitted to a BER standard of B2. Does this pull against the decarbonisation challenge? Is it known whether 10% is an optimal figure?

If, for example, that is pushed to 20%, 30% or 40% - many of these social homes are smaller and might have a lower heat load and a lower carbon impact than bigger homes, which are not social homes - might that make the decarbonisation challenge harder? Has any analysis been done? Where does that 10% come from?

Ms Clare O'Connor:

I do not know where the 10%, that exact figure for social housing targets, comes from. I am not sure if there is tension between that and decarbonisation objectives. We are calling for social housing to be retrofitted to B2 and hopefully made heat-pump ready. All social housing should be renewable-energy ready either through district heating or heat pumps. It is not necessary to have tension in increasing social housing.

Brian Leddin (Limerick City, Green Party)
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If we upgrade more social homes but ultimately they have a lower carbon impact as it is, we get a lower benefit. I do not know if the analysis has been done. The target of 500,000 houses is set because we need to decarbonise our housing sector rapidly. It would be interesting to see it. Maybe the optimal figure from a decarbonisation point of view is more social homes or maybe it is fewer, which is not something we would like to hear. Is Ms O'Connor aware of any analysis showing what that is?

Ms Clare O'Connor:

I have not seen analysis to show that specifically yet. To get the most in carbon savings that is again where the minimum energy performance standards will come in because they will trigger retrofitting for the least efficient homes, which are ultimately using the most carbon. We also really need to push heat pumps because ultimately the gas and oil being burned in any of these homes is causing emissions. We really need to look at decarbonisation of heating and legislation on that.

Brian Leddin (Limerick City, Green Party)
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Regarding the call for the rental housing sector to meet a certain standard, I acknowledge it is remiss not to have detail, considering that I believe the climate action plan calls for there to be a minimum standard. I think Ms O'Connor said that we do not know what that minimum standard would be but we know that it is to be implemented by 2025, which is only 18 months away. We know this minimum standard is coming but we do not have any clarity on what it might be, whether it is F, E, C or B. Have other jurisdictions brought in the minimum standard? How much further ahead of us are they?

Ms Clare O'Connor:

The UK has introduced minimum BERs since 2018. It was initially just for homes that were just coming onto the rental market. In 2021 it introduced a minimum BER of E for all rental properties. The EU energy performance in buildings directive will set minimum energy performance standards across the entire residential sector, likely starting with E and then moving up to C.

Brian Leddin (Limerick City, Green Party)
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That is coming through the energy performance in buildings directive, EPBD. Is E not very low or is the general consensus that we need to start and at least get in?

Ms Clare O'Connor:

A rating of E is very low. Ideally, we would want to see a minimum energy performance standard of C for all buildings by 2030.

Brian Leddin (Limerick City, Green Party)
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All buildings. I thank Ms O'Connor for that.

We will go to a second round. I think the Deputy O'Rourke wanted to come in.

Darren O'Rourke (Meath East, Sinn Fein)
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My question is on the quality of datasets for measuring energy poverty. I know about the definitions. Do we know the households? Do we know the distribution between urban and rural, working and not working, pensioners and people of working age? Obviously, a number of elements contribute to energy poverty.

I have heard that the SEAI has good information on BERs and the CSO, Revenue and others have indications on household income but that those datasets do not talk to each other. In the meantime, we are out conducting surveys to fill a gap as a result. I know this is a technical issue but it is important to get a clear picture to inform policy in this area. I ask the witnesses to outline their experience of trying to get a handle on energy poverty data in Ireland.

Ms Michelle Murphy:

It is very challenging because, as the Deputy pointed out, the datasets do not necessarily talk to each other and there is also a time lag between the CSO data and the SEAI data. It should be possible to ensure, expeditiously, that those datasets talk to each other. This goes to the previous point around how we measure the impact of the money that is being invested in retrofitting on energy poverty. How do we measure, for example, the impact of retrofitting local authority or social housing? If we do not have data, it will be challenging to communicate the positive outcome of retrofitting to people. At present, there is a challenge around communications because people see retrofitting and energy upgrading as a cost but we also have to communicate the positive benefits and the actual outcomes of that work. To do that, we need to have data to hand. For organisations such as Social Justice Ireland that are trying to measure the impact or the potential impact of policy, not having those data is challenging. The most up-to-date census data are due out next month and there is probably space within the small area of population statistics for that kind of micro-level data on the issue of energy poverty. Data that are available at a really local level would tie in with the issue of community energy advisers identifying by need and making sure that resources go to where they are needed most.

Ms Clare O'Connor:

Under the energy poverty action plan, the ESRI has committed to doing a piece of work on defining energy poverty. This should recognise the intersection of energy poverty, energy deprivation, income inadequacy, housing inadequacy and health impacts. It is quite a big piece of work and it will require a cross-government response, with input from all Departments.

Brian Leddin (Limerick City, Green Party)
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Can I just jump in on the ESRI work? Is this recent work by Ms Muireann Lynch? Is that what Ms O'Connor is referring to?

Ms Clare O'Connor:

It has been committed to as part of the energy poverty action plan that was published in December. I think it is happening this year but I am not aware that anything has been published yet.

Brian Leddin (Limerick City, Green Party)
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I think that is Ms Lynch's work and it might be an idea to invite her in. I apologise to Deputy O'Rourke.

Darren O'Rourke (Meath East, Sinn Fein)
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Does Ms Petrie wish to comment?

Ms Issy Petrie:

No, I think that covers it.

Darren O'Rourke (Meath East, Sinn Fein)
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The other question I had was on the retrofitting programme for people who are dependent on solid fuel. Ms O'Connor mentioned that Friends of the Earth proposed a targeted scheme and I ask her to elaborate on that.

Ms Clare O'Connor:

That was part of our pre-budget work with 42 other organisations. That proposal specifically looking at a targeted retrofitting scheme for people who are reliant on solid fuels came from Irish Rural Link. It had conducted research and engaged with people in rural areas who felt that a specific scheme for those using solid fuel was the way to go.

Darren O'Rourke (Meath East, Sinn Fein)
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The last question I have relates to what Ms Petrie said about a new consumer protection strategy from the regulator. I ask her to explain what she means in that regard.

Ms Issy Petrie:

If I may, I will just jump back quickly to the last question because an issue that has occurred to me is the depths of energy poverty and how that is looked at in the data.

I am not sure if that is being addressed in the new ESRI work. Currently you look at 10% but clearly that is just one point in the scale. There is also the question of how deep people are into energy poverty so it could be useful to have information on that. I do not think I have seen that here.

Regarding the consumer protection strategy, this is just recognising the issues from the last couple of years, with Covid and the pandemic and the impact on people's energy bills from staying at home longer and having to intervene there. Now with the energy price crisis, the regulator is putting in place new measures and reacting to the energy price crisis. It is about building on the reactive way of putting in consumer protections and moving to a more proactive status of introducing new consumer protection measures both during business as usual, when we are not responding to a situation, and building our ability to respond to situations, whether that is lockdown or a price crisis. It is about looking forward in that way. Part of that is the point we make about monitoring what is going on with consumers, particularly consumers in energy poverty, what we know about people on repayment plans, what we know about who is in arrears or who is being affected by a poverty premium and really digging into the groups in the energy market who are more at risk. There is not just one consumer; we know there are lots of different groups that are at heightened risk so we are trying to get a sense of that and pushing forward specifically-----

Darren O'Rourke (Meath East, Sinn Fein)
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Is there anywhere that does it well? Is there a regulator or jurisdiction that has a sophisticated response or plan? I guess there is a limited number of policy interventions that can be made.

Ms Issy Petrie:

Ofgem in Britain has a consumer protection strategy, in particular, a vulnerable customer strategy which is worth looking at. I will not comment specifically on what is in those policies but it has publications and consultations that build a consumer protection strategy.

Brian Leddin (Limerick City, Green Party)
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Further to my earlier comment about the Minister for Housing, Local Government and Heritage coming, that will be on Thursday, 15 June at 9 a.m. That is in a few weeks' time and I think that will be an interesting one for the members and for the public. No other members are indicating to ask questions but if any of our guests want to say anything, I will bring them in. This has been an incredibly interesting session. So much information has come at us. It is hard to grasp the breadth of information. I concur with colleagues that we are having the session at the right time. We had indicated that we might have it closer to the autumn but I am happy that we brought it forward because maybe we can seek to influence the budget discussions this side of the summer, whereas if we had left it to September or thereabouts, we may have been just tinkering around the edges. Ms O'Connor requested that we write to the Minister for Housing, Local Government and Heritage. We will do that ahead of him coming to the meeting. I can also confirm that we did write to the Minister for the Environment, Climate and Communications following the informal briefing we had with the witnesses a few weeks ago. Does Ms Rogers wish to comment?

Ms Susanne Rogers:

On poverty in general, energy poverty is just a facet of poverty. It is not that somebody is managing really well and then just cannot get their act together to pay their fuel bills on time. For us, this is just a facet of poverty. It is not separate. It is about the key issue of income inadequacy, which is going to be very important as we come into our pre-budget submission talk. It needs to be coupled with retrofitting but for us, energy poverty is poverty. It is not separate. It is not a category in and of itself that is over to one side. I just want to hit on that. Even with regard to the vulnerable customer piece, we do not tend to include low-income households in that category. Maybe that is something to explore around the definitions of who is vulnerable used by organisations.

Brian Leddin (Limerick City, Green Party)
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I thank Ms Rogers. Does anyone else wish to comment?

Ms Clare O'Connor:

There is a commitment in the energy poverty action plan to expand that to include financially vulnerable customers. The plan was to have that in place by this winter but, unfortunately, that was not the case. We would be interested to know where that is at currently with regard to amending the legislation.

Brian Leddin (Limerick City, Green Party)
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I thank Ms O'Connor. I thank all the witnesses for attending today. It was a very useful engagement. I thank members as well for their questions, which were very to the point. We are all interested in addressing energy poverty. There is probably further work for the committee on the back of this session. We will discuss that as a committee in private. I again thank the witnesses for coming in. We really appreciate their time and expertise. I have no doubt they will be before us again in the future.