Joe Costello (Dublin Central, Labour)

I wish to share time with Deputy Joanna Tuffy.

I compliment Deputy Coveney and the Fine Gael Party on tabling this timely Private Members' motion. I fully agree with the text of the motion apart from the final line to which the Labour Party has proposed an amendment.

The energy sector is central to the well-being of the economy. The price of gas and oil greatly affects the cost and competitiveness of our industrial products. Irish households are burdened with exorbitant fuel costs. Electricity prices jumped by 17.5% and gas prices by 20% in July 2008 because oil prices had spiralled to between $140 and $150 per barrel. The bottom fell out of the oil market months ago and the price of a barrel is now in the region of $40 and is likely to remain at a low level as the recession continues to bite and demand collapses. Despite this, the Commission for Energy Regulation, CER, has not seen fit to review the increases and give some relief to hard pressed householders.

The belated response from the Minister for Communications, Energy and Natural Resources, Deputy Eamon Ryan, yesterday when he indicated he expected a double digit reduction in fuel prices in 2009 is not good enough. It is unacceptable for the Minister to gaze into his crystal ball when no action has been taken. Prices should have been reduced long ago and the Minister is engaging in nothing more than a Pavlovian response to criticisms articulated in the debate on this motion.

Yesterday, the Government hit every public sector worker, even those on the minimum wage, with a sledge hammer by introducing a new tax on their gross income. In such circumstances, it is unacceptable that energy costs to the taxpayer and business are much greater than they would be otherwise if a decent Minister was in charge of the system. It is ironic that the Government's movement towards greater competition in the energy market has produced the opposite effect and energy has become more expensive.

Ireland is dependent on imports for approximately 90% of its energy needs. Without nuclear power or significant fossil fuel resources, it is imperative to establish and secure new sources and channels of energy supply. The gas conflict between Russia and Ukraine demonstrated the vulnerability of Europe's gas supplies. In this respect, it is essential that the east-west interconnector between Ireland, North and South, the United Kingdom and mainland Europe is developed with all haste. Funding of €1.4 billion is available from the European Union to complete this project. Through its economic stimulus package, the EU is making this fund available to help subsidise the cost of the interconnector, to upgrade Ireland's electricity grid and to assist in the development of an all-island single electricity grid and market. Ireland must fully and urgently engage with the EU and draw down this money as quickly as possible and not deal with it in the way it has dealt with the money available from the European Investment Bank for small and medium size enterprises, which it has not yet begun to draw down after four months.

The real challenge lies with the threat of climate change and the need to create a source and reservoir of sustainable energy. In mid-December, the European Council and European Parliament approved a historic climate and energy package which provides for a 20% increase in the use of renewable energy, a 20% reduction in carbon dioxide emissions and a 20% increase in energy efficiency by 2020.

Hydro-electricity is the original sustainable and renewable energy source in this country. Onshore wind energy is being developed in many areas but is not yet near its full potential. The Government must give full support to the development of this sector. Offshore wind energy is even less exploited. The European Union stimulus package makes available €500 million to help reduce the Union's dependence on energy imports. The main potential lies with wave energy. An island nation is ideally positioned to benefit from harnessing wave and tidal energy. Such harnessing is expensive, complex and difficult and requires much investment and research.

On 19 February, European Union Energy Ministers will discuss energy solidarity and the EU strategic energy review. In the context of the €200 billion EU stimulus package for economic recovery of member states, Ireland should seek an allocation of funds for offshore wave and tidal energy research and its translation into a powerful and sustainable energy resource which we could, at some point, feed back into the interconnector to supply Europe with renewable energy.

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