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.