Ossian Smyth (Dún Laoghaire, Green Party) | Oireachtas source

I thank Deputies for raising these important matters and allowing us time to discuss them today. I can appreciate the Deputies' concern, which is shared by all of us, that significant increases in the price of wholesale gas have led to an unprecedented rise in energy prices that has put financial strain on households and businesses in Ireland and across Europe. Clearly, the significant increases in energy bills and the cost of living are matters of very serious concern. The Government is keenly aware of the growing pressures that this is placing on families and businesses.

The most immediate factor affecting electricity prices in Ireland is sustained high international gas prices, which have risen and have remained high since the invasion of Ukraine. This is why a €2.4 billion package of supports was implemented during 2022 and a package of once-off measures worth €2.5 billion was included in budget 2023. The motion in question calls for the implementation of a recent EU Energy Council regulation. I assure Deputies that the Government is fully supportive of this regulation and implementation is currently in progress.

I will begin by outlining global market developments that have affected Irish energy prices. Subsequently, I will discuss the aforementioned EU regulation being implemented by the Department. I will then outline what the Government is doing in terms of providing support for households' energy costs in terms of both energy efficiency and welfare supports

The increased cost of energy is an issue that is affecting not just Ireland but all EU member states. Increased international gas prices as a result of the Russian invasion of Ukraine have had a serious knock-on effect on the market. As noted by the Deputies, domestic retail electricity and gas prices are now over 80% higher than this time a year ago. Elevated wholesale gas prices have also led to potential windfall gains for producers of natural gas and for certain electricity producers, which have seen an increase in revenues from the wholesale electricity market.

A number of points raised in the motion do not constitute something the Government would supply. However, the core focus of the motion is on seeking to address windfall gains in the energy sector with a view to benefiting consumers. It seeks to do this by implementing Council Regulation (EU) 2022/1854 on an emergency intervention to address high energy prices. In response to rising electricity and gas prices in the EU, the European Commission has put in place a number of measures available to member states to mitigate the impact of the energy price rises on households and businesses. The Council of Energy Ministers agreed the Council regulation on an emergency intervention to address high energy prices at their meeting on 30 September. The Council regulation, which was published on 6 October in the Official Journal of the European Union, has three key elements. The first involves the introduction of a cap on electricity market revenues for non-gas generators, including wind, solar, oil and so on. The second is a temporary solidarity contribution based on taxable profits on companies with activities in fossil fuel production and refining. The third introduces a requirement to reduce electricity demand over the winter period. The proceeds from this temporary solidarity contribution and from the market cap will go towards financial supports to consumers heavily impacted by soaring energy prices. Intensive work is now under way to implement these measures by the Department, which is working with the Department of Finance and other Departments and agencies.

The best long-term approach for Ireland to insulate consumers from volatility on international wholesale energy markets is to invest in energy efficiency and renewable energy, expand interconnection with European and neighbouring markets and deepen the Internal Market in energy. In terms of the overall cost of living, it is vital to stress that a co-ordinated whole-of-government response is being followed and is essential in tackling this issue. The forthcoming energy poverty action plan will set out a range of measures to be implemented this winter as well as key longer-term measures to ensure that those least able to afford increased energy costs are supported and protected.

This work is being undertaken by a steering group consisting of relevant Departments and agencies. This area of work also includes interactions with the NGO sector. In response to rising energy prices, the Government has already taken action throughout 2022 and introduced a suite of measures worth €2.4 billion to assist households with their energy costs. Throughout 2022, the Government has taken action in response to rising prices through a variety of measures. These include the electricity costs emergency benefit payment, which saw 99% of domestic electricity accounts being credited with the electricity costs emergency benefit payment of €176.22, excluding VAT. The total cost of this scheme to the Exchequer was just under €377 million. This was part of a €505 million package of measures put in place to address increasing costs of living, including increases in the fuel allowance and a reduction in VAT on electricity and gas bills from 13.5% to 9%. Other measures include a €320 million measure introduced to temporarily reduce excise duties on petrol, diesel and marked gas oil, which cut excise by 20 cent per litre of petrol and 15 cent per litre of diesel. Budget 2023 provides a further €2.5 billion in once-off measures for households. The budget package includes a new electricity cost emergency benefit scheme, which this House passed last month and has now been signed into law by the President. The scheme will credit €550.47, exclusive of VAT, to each domestic electricity account in three payments of €183.49, exclusive of VAT, in each of the following billing periods: November-December 2022, January-February 2023 and March-April 2023. The estimated cost of this scheme is €1.2 billion. The scheme will apply to domestic electricity accounts using their unique meter point reference number, MPRN, to allow the payment to be credited to individual bills automatically without the need for application or approval, including pay-as-you-go meters. Therefore, the payments will help both bill pay and pay-as-you-go customers with their electricity costs.

The measures introduced under budget 2023 also include a €400 lump sum payment to fuel allowance recipients in addition to the payment of €33 per week for 28 weeks; a total of €924 each year. Moreover, a €200 lump sum payment will go to pensioners and people with a disability getting the living alone increase, a €500 cost-of-living lump sum payment will be made to all families getting working family payment, there will be a double payment of child benefit to support all families with children and a €500 cost of living payment will go to people receiving carer's support grant and will be paid in November. Furthermore, a €500 lump sum cost-of-living disability support grant will be paid to all people receiving a long-term disability payment and a €500 rent tax credit will be paid to tenants.

Budget 2023 has also increased the total allocation of the Sustainable Energy Authority of Ireland, SEAI, by 36% up to €480 million. This is the highest ever budget to support the achievement of our retrofit targets. For SEAI residential and community energy upgrade schemes, including the solar photovoltaic, PV, scheme, we are increasing Exchequer funding to €337 million up from €255 million in 2022, which is a 32% increase. Importantly, within this, €291 million from carbon tax receipts will go back to help those households and communities. We delivered 15,500 retrofits in 2021 and are aiming for 27,000 this year. We are going further in 2023 to and expect 37,000 homes to benefit from retrofits next year. This includes 6,000 free energy upgrades under the SEAI warmer homes scheme.

The Government is acutely aware of the importance of protecting jobs in order to protect families during this energy crisis and this has been key in the design of the new temporary business energy support scheme, TBESS, which will provide up to €10,000 per business per month until spring 2023 to help meet rising energy costs. The scheme will support eligible companies covering 40% of the increase in their energy bills.

These measures are in addition to Government supports such as the household benefits package, which consists of a set of allowances which help with the costs of running a household, and which include allowances towards covering electricity or gas costs. Recipients are paid €35 per month. Under the supplementary welfare allowance scheme, a special heating supplement may be paid to assist people in certain circumstances. Exceptional needs payments can be made to help meet an essential, once-off cost that an applicant is unable to meet from his or her own resources.

The Economic and Social Research Institute, ESRI, has found that the once-off measures announced as part of budget 2023 will insulate most households from rising prices this winter. As I have highlighted today, the Government has long provided and will continue to provide practical supports for those struggling with their energy costs. The Government continues to allocate significant funding to these practical supports, via the welfare system, through energy efficiency grants and retrofitting.

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