Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

Energy policy, including the increasing costs of energy supply and taxation and profit, is a matter of key concern to the Government. In April, the Government approved and published the National Energy Security Framework, which sets the overarching response to the impact of the war in Ukraine on the energy system here in Ireland. In late September, Ireland, along with our fellow member states, agreed a new EU regulation to tackle high energy pricing in a co-ordinated way. It contains two revenue-raising measures which will address the windfall profits currently being made by some energy companies. These are a temporary solidarity contribution based on excess taxable profits for the fossil-fuel production and oil-refining sector and a cap on market revenues for specific technologies in the electricity sector which have not seen significant increases in costs.

The regulation prescribes how the proceeds from both these measures are to be utilised, including providing financial support to final energy users, such as vulnerable households and businesses. Energy policy is under the remit of the Department of the Environment, Climate and Communications and officials from my Department and the Revenue Commissioners are currently supporting that Department in the implementation of the regulation. The Government has also taken several other measures to reduce the burden on consumers in respect of the cost of energy. This includes providing a total of €800 of electricity credits to every domestic electricity account holder in the country, an additional fuel allowance payment, reductions in fuel excise duty and a reduction in the VAT rate for electricity and gas.

As Deputy Barry will be aware, on Tuesday the Government agreed to be part of the EU-wide framework in respect of how the energy sector will be taxed. Our participation in this EU framework on these issues is the best way for a small, open economy like ours to tax excess profits that are, or could, be going to become available across 2023. The measures, and the way they have been designed by the Directorate of Energy, get the balance right between taxing levels of profits that could become very high for reasons that have nothing to do with the companies concerned and all to do with the impact of the war on the functioning of the electricity sector and the functioning of the price of gas and the profit available to companies involved in this sector, while still recognising the role of investment in this sector and important role it can play in the Irish economy.

What we are also going to be introducing in this legislation will be the temporary business energy support scheme, TBESS. This will support businesses whose average unit gas or electricity price has risen by more than 50% compared to the average unit gas or electricity price in 2020. This will be a significant measure. It will be one that up to the end of February 2023 we believe will involve the spending of up to €1.2 billion of the country's money to support small-and-medium businesses during what we know will be a difficult time. Taking into account the measures the Government is taking with regard to the taxation of the sector and the supports that will be available to small-and-medium-sized businesses, I cannot therefore support this amendment.

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