John Gormley (Dublin South East, Green Party)

The measures I have outlined in the residential sector, which amount to an investment of €45 million in the coming year, will support the achievement of the emission reduction targets which have already been set out in the Government's draft energy efficiency action plan and are, therefore, already quantified in the carbon budget table.

Similarly, I am not separately quantifying the impact of the expansion of accelerated capital allowances for energy efficient equipment, which was announced by the Minister for Finance yesterday, but this will reinforce the drive towards greater efficiency and reduced emissions in the commercial and industrial sector.

The importance of livestock-based agriculture and food production to Ireland's economy is unique within the EU. The scale of the sector is such that it will be impossible to meet our long-term greenhouse gas targets without significant emission reductions in agriculture. We must find ways of achieving this without undermining the economy, food security and rural communities. The Government is investing heavily in wide-ranging research on the potential for more efficient use of inputs, improved production systems and other emission-abatement measures. The considerable effort we are now devoting to the promotion of organic farming will also result in lower emissions. Similarly, promotion of biomass for energy will give multiple climate benefits.

As in other sectors, most of the benefit will come in the longer term and will be more relevant to our 2020 target than to the Kyoto period. However, the Department of Agriculture and Food has estimated emission reductions of 200,000 tonnes per annum on average in the 2008-12 period through new measures now being introduced, and this is reflected in the table I have circulated to Members. These accrue mainly from organic farming and from increasing the length of the grazing season.

The final two columns of the table show the adjustment to the projections for the Kyoto period as a result of the measures I have outlined. It is important to note that the economic growth rates underlying the EPA projections are broadly similar to the ESRI's "Benchmark" forecast which was published in its Medium-Term Review: 2008-2015 last May. It may well be the case that the projections now somewhat overstate the baseline trend for the Kyoto period, given economic developments since May. They will be revised when new forecasts for medium-term economic growth are firmed up, and I expect some further reduction in the distance to target. This also means that the requirement to purchase credits is likely to be somewhat less than the 4.6 million tonnes shown in column F of the table.

I have made my position on carbon credits very clear on several occasions. I recognise that the flexible mechanisms are an integral part of the Kyoto Protocol and I appreciate the value of promoting green investment, particularly in developing countries. I do not have a difficulty availing of the flexible mechanisms to help meet our obligations in the short term, but with one major qualification. We must not under any circumstances allow the availability of carbon credits to deflect us from taking the necessary actions to place us on a low carbon trajectory in the longer term. Over-reliance on carbon credits in the future will be a millstone which will hold back our economic development and deny us the advantages which will flow from early-mover adoption of efficient technology in transport, energy production, agriculture and in our homes and workplaces.

This year's carbon budget is a starting point but much more progress will be required in the coming year. I particularly welcome confirmation by the Minister for Finance that an announcement on the carbon levy will be included in next year's budget, taking account of the recommendations of the Commission on Taxation when it has reported. The principle of carbon pricing is accepted by virtually all economists and analysts as the most effective way to secure emission reductions. It is the basis of the EU's emission trading scheme which applies to the bigger emitters, such as power generators and industrial plants. The carbon levy will enable us to harness its benefits in the rest of the economy and will deliver a further reduction which will be reflected in next year's carbon budget table. Over the next year the Government will develop further measures to get to grips with the climate challenge, reduce our purchases of carbon credits and bring us on track for the annual average 3% reduction in emissions to which we are committed in the programme for Government.

We must also ensure that Ireland's economy adjusts to a low-carbon future. It is estimated that the green technology sector is now worth €284 billion worldwide. The European Commission estimates that eco-industry in Europe already employs more people than either car manufacturing or chemicals, and various reports have projected huge employment growth in the years ahead. Instead of merely taking technological developments from other countries, we have an opportunity to play a leading role in developing a green economy. Some years ago we harnessed the State's industrial, educational, enterprise and development resources to develop biopharmaceutical and ICT sectors in Ireland, leading to significant inward investment and highly productive employment. The Government intends to take a similar approach to the development of the green technology sector. We have already made significant steps towards embracing this growth area but, to be effective, we must take a "whole-of-Government" approach.

In this regard, the Government's Cabinet sub-committee on climate change and energy security is examining how the green economy might best be fostered. In the coming weeks a number of Ministers who have responsibility in the relevant areas will collectively announce the establishment of a high level action group to advise on the development of Ireland's green economy. The group will report to Government within four months, setting out an action plan for developing green enterprise in Ireland with a view to contributing to economic growth and providing new, quality employment opportunities in this growing sector. The group will be tasked with identifying the potential for enterprise development, how education and training might address skills deficits, necessary research and development and the potential for Irish firms to bid for public procurement opportunities throughout the EU. We are determined to guide our economic development and well-being on to a sustainable and low carbon path. By successfully developing a thriving green technology sector, we can look forward to making a significant contribution to emission reductions.

The State already plays a direct role in the economic life of the country. It directly purchases products and engages services through public procurement. The Government is currently considering how our public service can give greater consideration to environmental impacts in its procurement arrangements. This has the potential to play a significant role in giving an incentive to companies to improve their environmental performance, leading to reductions in emissions, and in assisting Irish companies in successful international public procurement competitions.

I do not under estimate the scale of the environmental challenges we face, nor am I under any illusion about the uphill struggle we have in tackling our climate change emissions. The modest steps we are taking, which are undoubtedly an improvement on what has gone before, will not be enough to achieve the type of emission reductions we require. We must be much more radical. The introduction of a carbon levy next year will be an important step, but it is only one step in what has to be a fundamental multi-faceted approach, involving all Departments.

I have been campaigning on environmental issues for all of my adult life and I know what must be done. We have very little time to do it. It is worth making the effort even if it is at times frustrating. I retain the hope that we can work together on these very important issues on a non-partisan basis.

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