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

I move:

"That the Bill be now read a Second Time."

I am pleased to address the House on the Second Stage of the Gas (Amendment) Bill 2023. As Deputies are aware, the Minister for the Environment, Climate and Communications is the Minister with responsibility for gas policy and all legislation relating to gas and energy policy. The European natural gas directive - directive 2009/73/EC on common rules for the internal markets in renewable and natural gases and in hydrogen – in relation to the unbundling of ownership of generation, supply and transmission systems in the energy market prevents the Minister for the Environment, Climate and Communications from assuming the role of majority-shareholding Minister in Gas Networks Ireland, GNI, and its parent, Ervia. As such, the Minister for Housing, Local Government and Heritage is the majority-shareholding Minister for Ervia, which manages national gas infrastructure through its subsidiary GNI. As a consequence, the Department of Housing, Local Government and Heritage has the remit in respect of the governance of Ervia.

The Government decided in 2020 that having two separate State companies to operate the gas network and develop water services provides the optimal solution to meet the future challenges of decarbonising our energy supply and modernising our water services. Therefore, the Water Services (Amendment) Act 2022 was prepared. It was signed into law on 7 December 2022, and on the date appointed in the legislation, 1 January 2023, Uisce Éireann was split from the Ervia group and became a stand-alone company. The Government decided that the most appropriate structure of the remaining gas utility business following the separation of Uisce Éireann from Ervia was the integration of Ervia into GNI so as to become the single entity GNI. The Government's decision to integrate Ervia into GNI is being led by the Minister for the Environment, Climate and Communications, who has responsibility for gas legislation.

Before outlining the provisions of the Bill, I would like to speak on a number of key points relating to it. Ervia's business, in terms of both revenue and activities, is predominantly the operation, maintenance and development of the gas networks and interconnectors in its ownership. Ervia and Gas Networks Ireland are currently operating as a single entity from a structure, strategy and operational point of view.

Ervia was established as a statutory corporation pursuant to the Gas Act 1976, as amended, and its subsidiary GNI was established as a company under the Companies Acts with its own constitution pursuant to the Gas Regulation Act 2013. Ervia is fully State owned and the sole owner of GNI.

It is also relevant to note that the EU is currently in the process of agreeing legislation on the hydrogen and decarbonised gas market legislative package, namely, the European natural gas directive, Directive 2009/73/EC. This will provide for a further consideration of the functions of GNI regarding the decarbonisation of the gas network. The functions of GNI in this legislation reflect the current activities it engages in, and any changes to its function will be addressed in the implementation of the gas package when negotiations have concluded. A priority will be the decarbonisation of the gas network in line with the commitments set out in the climate action plan and programme for Government.

The main purpose of the Gas (Amendment) Bill 2023 is to provide for the integration of Ervia into GNI so as to become the single entity GNI. The Bill provides for amendments to the Gas Acts to facilitate the integration and the transfer of functions, assets, rights, liabilities, staff and records from Ervia to GNI, as well as providing for the corporate governance arrangements relating to GNI in terms of shareholding arrangements, the board arrangements and its chief executive, annual reporting and accounting provisions. These governance arrangements are being provided in primary legislation rather than constitutional documents, enhancing transparency and accountability.

I will now elaborate on the provisions of the Bill. It is a relatively short Bill. It has 22 heads in total and is largely technical. It is divided into two Parts. Part 1 provides for the Title to the Bill, the Bill's commencement and the definitions used in the Bill. Part 2 lists the provisions for the dissolution of Ervia and the integration of its functions, roles, responsibilities and liabilities into GNI. Part 2 also includes the chapters of the Bill that concern the amendment of other enactments to facilitate the dissolution of Ervia and the integration of its functions, properties, liabilities, staff and records into GNI.

I will summarise the Bill's 22 chapters. Part 1 contains Chapters 1 and 2. These are standard provisions that provide for the Short Title to the Bill and the commencement on enactment or by means of ministerial order, as appropriate, of its various provisions, as well as definitions of certain terms referred to in the Bill. Part 2 contains the rest of the chapters, which provide for the integration of Ervia into GNI.

Chapter 3, which provides for the restatement of the definition of the majority-shareholding Minister, which currently is for Ervia, and will be for GNI, the Minister for Housing, Local Government and Heritage.

Chapter 4 establishes a transfer date, which will be set by the Minister by way of an order. Chapter 5 provides for the cancellation of Ervia's shareholding in GNI and for the issuing of new shares to the relevant Ministers.

Chapters 6 to 10, inclusive, cover the transfer of the existing functions, responsibilities, liabilities, assets and so on from Ervia to GNI. This includes the transfer of all functions concerning gas that are statutorily vested in Ervia to GNI, the transfer of land and any other property of Ervia to GNI, and the transfer of rights and liabilities of Ervia resulting from any contract or commitment Ervia has entered into to GNI, including all contracts or commitments involving Ervia. Furthermore, it provides for liability for loss occurring before the transfer date and ensures GNI will assume any liability outstanding from Ervia.

Chapters 11 and 12 provide for the transfer of staff from Ervia to GNI and any records held by Ervia to GNI. Chapter 13 provides that the final accounts and final annual report of Ervia can be prepared and progressed by GNI on Ervia's behalf. Further provision is included to enable GNI to carry out, after the transfer date, administrative tasks associated with the dissolution of Ervia.

Chapters 14 and 15 and Chapters 18 to 22, inclusive, amend a range of legislation to change references to Ervia to references to GNI and, where appropriate, references to Ervia to references to the Minister.

Chapters 16 and 17 provide for amendments relating to the board and constitution of GNI and the preparation of annual reports and financial statements. Chapter 16 provides for amendments relating to the board and constitution of Ervia. The proposed amendments involve the repeal of Schedule 1 of the Gas Act 1976, the substitution of sections 6 and 7 of the Gas Regulation Act 2013 and a number of other minor amendments to the 2013 Act. These deal with directors of GNI. They are being substituted to reflect the revised board structures that will be in place following the integration of Ervia.

Schedule 1 of the Gas Act 1976 is being repealed. Schedule 1 was originally drafted for the Irish Gas Board, Bord Gáis Éireann, which did not have a constitution, unlike GNI which is registered as a designated activity company, DAC, under the Companies Acts. The Schedule of the 1976 Act is being repealed in order to eliminate duplication of the matters that are dealt with by either the GNI constitution or the Companies Act 2014. The revised section 6 reflects that GNI has a constitution under the Companies Act.

Chapter 17 substitutes sections 14 and 15 of the Gas Act 1976 which provide for the preparation of GNI’s annual report and accounts.

Chapters 18, 19, and 20 provide for amendments to the Gas Act 1976 to update terminology to reflect the integration of Ervia into GNI and Chapter 21 provides for a variety of miscellaneous amendments to the Gas Act 1976.

Chapter 22 provides for the repeal of section 21B(1) of the Gas (Interim) (Regulation) Act 2002 which is deemed redundant as GNI cannot take over the function of being a shipper of last resort from Bord Gáis Éireann.

I commend the Bill to the House and look forward to the debate.

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