Jennifer Whitmore (Wicklow, Social Democrats) | Oireachtas source

I move:

That Dáil Éireann:

notes that:

— the price of energy has more than doubled in the past year;

— consumers' energy bills have increased to an average of €4,300 per year;

— more than 40 per cent of households are now estimated to be living in fuel poverty, according to the Economic and Social Research Institute;

— a consultant geriatrician at the Mater Misericordiae University Hospital told RTÉ in December 2022 that older people were developing hypothermia in their homes because their homes were so cold;

— the energy crisis is a primary driving factor of the cost-of-living crisis that is decimating the incomes of workers and families;

— according to a new survey from Barnardos Ireland, 25 per cent of parents have had to cut down on household bills, like gas and electricity, in order to afford food for their families;

— the Barnardos' survey also found that one third of parents have skipped meals so their children would have enough to eat; and

— the number of parents using foodbanks has more than doubled in the past year – from four per cent to 10 per cent;

further notes that:

— the unprecedented energy crisis is threatening the future of many viable businesses;

— energy bills for many small and medium enterprises have more than tripled in the past year alone;

— there is a risk of the energy crisis becoming a jobs crisis if businesses begin to close;

— the Irish Small and Medium Enterprises Association has warned that supports already announced by the Government do not go far enough;

— just €26 million has so far been drawn down from the Temporary Business Energy Support Scheme (TBESS) — which has a budget of €1.2 billion; and

— the low take up of the TBESS is evidence the scheme is not fit for purpose;

furthermore, notes that:

— as consumers' and businesses' bills soar, energy companies are making record profits;

— Shell's profits doubled to €36 billion in 2022;

— ExxonMobil made a staggering €51.5 billion profit in 2022 – which equates to a profit of €5.8 million every single hour;

— in the first six months of 2022, the Electricity Supply Board's profits more than tripled to €390.3 million;

— operating profits at Bord Gáis Energy increased by 74 per cent in the first six months of 2022;

— profits at the Corrib gas field trebled in the first six months of 2022 to an estimated €560 million;

— profits at non-gas electricity generators are running six times ahead of expectations – because electricity prices are linked to the price of gas;

— the Minister for Environment, Climate and Communications, Eamon Ryan TD, first committed to the introduction of a windfall tax in August 2022 and the European Union (EU) authorised the introduction of a windfall tax in September 2022;

— despite wholesale energy costs decreasing in recent months, not a single energy company or supplier has reduced its prices; and

— ExxonMobil issued proceedings against the EU in December 2022 in an attempt to scupper plans for windfall taxes across the entire bloc;

recognises that:

— the 1998 Energy Charter Treaty protects fossil fuel companies by allowing them to sue governments that introduce policies that impact their profits;

— the Energy Charter Treaty is therefore incompatible with our Climate Action Plan and inimical to our climate action targets;

— many EU countries, including France, Germany, the Netherlands, Poland and Spain, have announced their intention to withdraw from the Energy Charter Treaty; and

— the Irish Government has refused to withdraw from the Energy Charter Treaty;

further recognises that:

— a blanket energy price cap for households and businesses would be difficult to budget for and would not disincentivise energy use;

— a number of EU countries have introduced targeted energy price caps to provide certainty and security for consumers and businesses;

— in Germany a targeted energy price cap, which caps the price of approximately 80 per cent of average energy usage, will cushion households and businesses from dramatic energy price shocks and provide certainty about costs;

— such a targeted price cap would also incentivise the conservation of energy; and

— a windfall tax would work in tandem with a targeted price cap to ensure that energy companies cannot price gouge while the cap is in place;

agrees that:

— profiteering on war is immoral;

— record profits at energy companies are grotesque;

— the Government's delay in introducing a windfall tax on energy companies is deeply concerning;

— the Government's response to the energy crisis has been grossly insufficient and support is not going to those families and businesses who need it most; and

— the Government's refusal to join other EU countries in leaving the Energy Charter Treaty should be condemned; and

calls on the Government to:

— introduce targeted price caps, which would cap prices for average energy use by households and businesses, as soon as possible;

— immediately introduce a windfall tax on energy companies and use that money to support struggling consumers and businesses;

— commit to reviewing the proposed cap on market revenues for non-gas electricity generators before its proposed June 2023 expiry date with a view to extending it until 2024; and

— announce its intention to immediately leave the Energy Charter Treaty.

Soaring energy costs are causing turmoil in households and businesses all over the country. Price increases have been relentless, with some energy companies increasing their prices on five separate occasions last year. This maelstrom of price rises can make people feel dizzy, and it is hard to keep track of exactly how high prices are becoming when they are increasing or seem to be increasing every other day.

Energy companies are boiling us alive and hoping we do not notice. Worse, they are charging us exorbitant prices for the pleasure of being boiled. Since there is so much opacity regarding price rises, it is important for us to be clear here today. We need clarity so we can truly appreciate just how far and fast energy prices have risen in this country. According to the Sustainable Energy Authority of Ireland, SEAI, Irish residential customers were paying between 15 cent and 18 cent per kilowatt hour for electricity in 2021. In 2022, after Russia invaded Ukraine, prices rose by up to 35 cent per kilowatt hour. Last month, these rates spiked to between 43 cent and 45 cent per kilowatt hour. That indicates a rise from 15 cent to 45 cent per kilowatt hour, meaning that energy costs have tripled in two years. On average, residential customers are now paying €4,300 for energy per year. There is no indication that this is the upper limit. In fact, prices could go even higher. There is no precedent in modern history for the speed at which energy prices have increased and the exorbitant prices now being charged. Never before were families expected to pay so much just to ensure they could cook their children a modest meal and keep them warm.

Energy is not an optional extra. It does not entail discretionary expenditure that can be excised from budgets to save cash. People and businesses need it to survive. Parents are now enduring extreme stress and worry every day. They are worried about how they will continue to heat their homes and feed their families. Businesses, particularly small and medium enterprises, have been hit particularly hard and some have seen their bills quadruple. Many otherwise viable businesses are now contemplating closure simply because they cannot afford to keep the lights on.

The price rises being foisted on families and businesses are unprecedented, but so too are the profits being generated by rapacious energy companies. Yesterday the Taoiseach told my colleague Deputy Shortall that Irish energy companies would soon be posting enormous full-year profits for 2022. We can assume that this was a warning to prepare us for more obscene profits from a sector that is merrily profiteering on a war. If their half-year profits are anything to go by, it will be a bumper year for energy companies.

In the first six months of last year, the ESB troubled its profits, and Bord Gáis Energy's profits increased by 74%. Profits at the Corrib gas field also trebled in the first six months of 2022. Profits at non-gas electricity generators, such as wind farms, are up to six times higher than expected. Meanwhile, the Government's windfall tax, which the Minister responsible for energy, Deputy Eamon Ryan, committed to in August and on which the EU signed off in September, is nowhere to be seen. The last we heard from the Minister, he was still drafting the legislation to underpin it. Other EU countries, such as Germany and Spain, have already managed to introduce a windfall tax, and they did it in December. Italy's windfall tax was introduced in March 2022 and collected €4 billion by December, yet here in Ireland we have to wait. Yesterday, the Taoiseach told us the windfall tax would be ready in a matter of weeks. I hope that promise is delivered on.

I have a question for the Minister of State, Deputy Ossian Smyth, on which I would really appreciate a response. Is Ireland in contravention of the EU regulation underpinning the windfall tax? Article 14 states member states shall adopt and publish measures implementing the contribution by 31 December 2022. If that is the case, Ireland has missed the deadline and is in contravention of the regulation.

Profiteering from a war is immoral and grotesque, and the Government must stop facilitating it. In tandem, it must now act to constrain prices and provide tangible reliefs for households and businesses. The Social Democrats introduced this motion because we are deeply concerned about the Government's approach to the energy crisis. It opted for the blunt instrument of electricity credits at the start of this crisis. Credits were first announced in December 2021 because we were told there was no time to do anything else. The Government said it wanted to get the money to people fast and that credits were the easiest way to do it. Fast forward to budget 23 last autumn and the credits were again relied on as support mechanisms. Now we are talking about what amounts to a mini-budget in the spring. We are again told credits will be used as the preferred energy support. More than a year has passed since energy credits were first announced but the Government remains trapped in emergency mode. There has been no evolution in its policy and no recognition that, as this crisis develops, so too must its policy approach.

The worst thing is that the Government's policy approach is clearly not working. At the end of December, nearly 260,000 energy customers were in arrears. The Government's temporary business energy support scheme is so convoluted that it is functionally useless. Just €26 million has been drawn down by businesses from the €1.2 billion available under the scheme. The Taoiseach admitted yesterday that this was just a fraction of what the Government had expected and said the Minister for Finance had gone back to the drawing board, but only to the extent that he is going to tweak a scheme that is really an abject failure. While the Minister busies himself painting lipstick on a pig, businesses are going under.

What we need is a policy shift, not cosmetic changes. Targeted energy price caps for both households and businesses are the only guaranteed way to keep prices down and ensure certainty about costs. This would not be a blanket cap that would reduce the cost of energy in an unlimited or uncontrolled way. It would mean families and businesses would be supplied with energy at reduced rates to meet their average energy needs. Any energy use in excess of this amount would be charged at market rates. It is a cap that can be budgeted for. How do we know this? It is because the Germans have already done it. Unlike an unlimited cap, it does not disproportionately benefit wealthier households and it incentivises energy conservation.

Yesterday, when Deputy Shortall raised this with the Taoiseach, he tried to pillory the idea by associating it with Ms Liz Truss, who we all accept was no economic guru. Another Government Deputy derided it as a Tory cap. I can only charitably assume that Ministers and Deputies on the other side of the House do not know what they are talking about. Either that or they are being wilfully obtuse. The attack lines from the briefing memos in Government Buildings will have to be revised. The Government can accuse the Germans of many things but fiscal recklessness is not one of them. Is the Taoiseach really saying the Germans are writing blank cheques for energy companies or emulating Ms Truss's disastrous Brexiteer economics? Maybe he is really saying the Irish Government does not have the fiscal acumen or ability of the German Government and therefore cannot implement what it has done. The automatic reflex of the Government is to malign constructive suggestions from the Opposition rather than engage with them on their merits. It is a reaction that repeats itself with depressing regularity.

A progressive cap on energy prices that we know can be introduced and make a tangible difference to families and businesses becomes derided as "Truss economics" or the "Tory cap". This despite the fact that the cap originated from the boringly responsible Germans.

The Taoiseach even adopts the same scorched earth approach to research. This week, Barnardos published the results of a study that found that the number of parents using food banks had doubled to 10%. The leaders of most governments where this was happening would feel some sort of shame or a twinge of regret. Instead, the Taoiseach announced that he did not believe the results of the survey and implicitly smeared the professionalism of those who compiled it. The Taoiseach may not know many people who use food banks, but that does not mean they do not exist. Perhaps he should attend the Capuchin day centre some time to see the queues.

I would say that the Government was out of touch, but we have long since passed that stage. The Government is now in orbit, somewhere in deep space. Gaslighting the country is not a sustainable communications strategy. We continually hear that the Government's policies are working even though we see evidence of the opposite with our own eyes.

Yesterday, Electric Ireland told RTÉ that prices might not reduce for 18 to 24 months despite wholesale prices already being on the decrease. Something has to give. Enough is enough. Households and businesses cannot wait for prices to come down. They need action now. A targeted energy price cap would provide relief from energy price shocks. More than that, it would give certainty about pricing, thereby providing considerable relief for businesses. This has been done elsewhere. There is no reason it cannot be done in Ireland except for Government stubbornness and arrogance.

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