Liz McManus (Wicklow, Labour)

I warmly welcome the Bill. It is particularly welcome at a time when recession, job losses and a contraction in business activity are affecting so many other areas of the economy. The Bill is designed to enable Bord Gáis to increase its borrowing capability to €3 billion. I hope the banking system will be able to oblige the company. As everyone is aware, the banks are in quite a sorry state at present. Bord Gáis is a State company and is taking on the job of the further development of an essential part of our infrastructure in the form of exactly the kind of investment that is required at present. It is to the credit of Bord Gáis that this Bill has been introduced.

In the recent budget, the Government did not provide an economic stimulus in order to ensure that people would remain in work rather than ending up on the dole. Even though the IMF has argued in favour of the provision of such a stimulus — countries such as the US and the UK have already taken action in this regard — all we have had are cutbacks and people claiming the dole who never expected to be obliged to do so.

The investment to which the Bill will give rise, which is being overseen and safeguarded by the State and the Government, is extremely important. I welcome that investment on behalf of the Labour Party because it represents good news. Energy security and sustainability are the major challenges we face. If one considers what is happening in the area of electricity generation, the ESB is to be commended on the major step it took in committing to a magnificent shift towards renewables. The Government recently raised targets in this regard to 40% by 2020. I have some concerns in that regard, even though I support what has been done. While the ESB is expected to reach incredible heights, I am concerned that the same demands are not being made in respect of areas, such as transport and agriculture, that give rise to high carbon dioxide emissions. The danger is that those organisations that are progressive will be obliged to carry an undue burden in respect of our commitments on climate change.

In the case of gas, the issue of energy security certainly arises. It is a feature of our increased reliance on gas, coupled with an absence of sufficient domestic reserves. Gas and electricity prices have skyrocketed and thousands of people are struggling to pay their bills. In 2006, natural gas accounted for a 12% share of total fuel consumption. It remains the dominant fuel in electricity generation. It is clear that investment in gas infrastructure is needed and should be progressed.

The issue of security of supply is central when discussing matters relating to gas. Some 90% of Ireland's requirement is sourced in the UK. Import dependency has grown in the past decade and all the figures illustrate our over-reliance on imported gas. We would all like to see developments designed to ensure we have an indigenous supply of gas. However, I hope lessons can be learned in the context of what has happened in recent times. Everyone is aware of the difficulties that occurred in respect of the Corrib gas field. In that context, development must be carried out in a way that does not lead to open confrontation with local communities.

I welcome the forum the Minister, in conjunction with the Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív, has established. I hope it succeeds and I wish it well. However, we will be obliged to await the outcome of its work. I ask that goodwill be shown by members of the local community in order to ensure there is some opportunity for progress to be made.

Most people believe the find at the Corrib gas field will lead to lower gas prices. However, the startling evidence is that as we import less, the price of gas will increase because the same capital costs will be incurred in respect of the interconnector. Due to the fact that Corrib gas will be sold at international market prices, we could be in the invidious position of paying more for it. That situation appears to be untenable.

In January 2008, the Minister, Deputy Ryan, welcomed a provision in section 41 of the Finance Bill, which gave effect to a new profit resource rent tax on oil and gas production. At the time he stated:

The objective behind this new tax was to boost Exchequer returns from commercial discoveries off our shores, while at the same time maintaining Ireland's attractiveness for such exploration. Our oil and gas resources belong to the people. It is only right that Irish people benefit significantly from the profits these resources generate.

The return to the Irish people has been successfully whittled away over decades by Fianna Fáil Ministers, including former Deputy Ray Burke in 1997 and the former Taoiseach, Deputy Bertie Ahern, in 1992. Naturally, the Labour Party welcomed the change, albeit modest, introduced by the Minister for Communications, Energy and Natural Resources, Deputy Eamon Ryan, which while it did not significantly benefit the Irish people, as he claimed, did improve the tax situation somewhat, or so we thought. The problem is that neither we nor the Ministers for Communications, Energy and Natural Resources and Finance know if it did benefit the Irish people.

I asked by way of parliamentary question what had been the return as a result of this change and was told by the Minister for Finance that he did not know because there is not within the Revenue Commissioners any information on the breakdown of revenues collected that would provide an answer to my question. Also, the Minister of State, Deputy Power, said he had no function in the matter, which was not much of a surprise. All of this means that despite the high glowing phrases of the Minister, Deputy Ryan, last January, nobody can tell the Irish people whether there was any benefit from the change in the Finance Act. We need to address this issue.

It was clear, from a recent presentation to the Joint Committee on Communications, Energy and Natural Resources by the Irish Offshore Operators Association, that exploration offshore from Ireland is relatively costly because of geology, the harsh deep water environment and the fact it is generally a gas prone rather than oil rich area. These are natural limitations that will not change. As time goes on and we face an increasing scarcity of gas and oil supplies worldwide, we can expect that interest may well increase in obtaining rights to exploit whatever potential exists in this regard. In view of that possibility we should know, at the very least, how much revenue is or could be generated by this exploration in terms of the 25% tax already in place and the change declared by the Minister.

It would not be right to speak on this Bill without referring to the cost of fuel which has been a dominant topic in terms of public discourse and debate in this House. Petrol prices have gone through the roof and electricity and gas prices have rocketed. Transparency in regard to prices as provided for under the EU Gas and Electricity Price Directive is a welcome step forward in assessing how well or how badly Irish customers are faring in comparison to our EU counterparts. We have the highest overall dependency on fossil fuel. Electricity prices to industrial and commercial customers in Ireland in the second half of 2007, according to the information now provided to us, ranged in all consumption bands from 3% to 52% above the EU average. In the most common industrial consumption bands applicable in Ireland, electricity prices were 23% and 29% above the EU average, due in part to the high proportion of electricity generated by gas and oil. This is a particular factor for business at a time when business is under considerable pressure owing to the recession and the banking crisis. We must ensure that competitiveness is built-in. This is one of the pillars of Government policy and is one that we must keep to the forefront of our minds.

Another issue that arises is fuel poverty. While businesses can benefit from having a manageable fuel bill, many people cannot manage to pay their bills. The Minister recently announced funding for a new warmer homes scheme made up of €5 million from his Department, €5 million from Bord Gáis and €5 million from the ESB. While this is to be welcomed, it needs to be built on. We need much greater emphasis on insulation. The Labour Party in the debate on the budget argued strenuously for a national insulation programme that would put many people who are out of work as a result of the downturn in the construction industry back to work. Insulation is one of the most practical ways of ensuring a reduction in energy prices for households. We know that right across the board our insulation levels, in particular in older houses, are far too low.

Last Friday, I attended a conference on climate change in Cork. It was well attended, with presentations from an impressive line-up of speakers who reiterated the point that we have reached the point where we simply cannot avoid the challenge. I appreciate that the Minister for the Environment, Heritage and Local Government, Deputy Gormley, and Minister for Communications, Energy and Natural Resources, Deputy Ryan, are setting out their stalls and making as much progress they can. However, this cannot be done by them alone. It seems to me, in particular given the economic crisis and the Government's concerns voiced elsewhere, that the challenges in every Department that need to be addressed are simply being let slip. This is not good enough. We cannot ignore the challenges be they in transport or agriculture.

On infrastructural development, we are speaking in this regard about a fuel that is, at least, more environmentally sustainable than others upon which we are so reliant. We need to encourage development across the board to ensure there is no longer regional divide when it comes to provision of gas supply. We know that businesses very often locate in areas with particular infrastructure, be it water, gas, sufficient electricity supply, broadband and so on. These are the needs of our future in terms of the creation and development of sustainable jobs. It is to the credit of Bord Gáis that it is willing to take on that role. Members will recall the disaster of the sale of Eircom which led to a decline in the possibilities of infrastructural development. Bord Gáis paralleled by the ESB, another State company, is ensuring that Ireland will have muscle when it comes to developing our capability to compete and in regard to security of supply, which at the moment we do not have in terms of storage or resources. These are considerations which must be at the forefront of our minds.

I welcome the Bill. I do not expect anybody will have any major problems with it. I wish it well and hope we will find a resolution, in terms of the form the Minister has established with regard to the Corrib find, that can become a template for other finds into the future. If we do not learn from that experience, we are in danger of repeating our mistakes, which I do not believe anybody wants at this stage when energy is such a central part of our future and that of the planet which is dependant on us succeeding in reducing significantly our carbon emissions.

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