Richard Bruton (Dublin Bay North, Fine Gael) | Oireachtas source

I welcome this debate. It is timely. Other Deputies have well articulated the defects in the energy charter treaty. It is important to recall, as the note from the Oireachtas Library and Research Service has underlined, that this emerged in the early 1990s in the wake of the opening up of eastern Europe and following the collapse of the Soviet Union. There were genuine desires to see integration east-west so that energy in particular would be a basis not only of co-operation and mutual benefit but so this could be done in a way whereby people would have mutual reassurances that if they did make those investments, their investments would be protected. Having investments running outside the European Union and into other countries to underpin energy security is a sensible idea. The issue that has arisen here is that the context in which the energy charter was drawn up has radically changed with the climate agenda. Other Deputies have rightly pointed out that it is no longer consistent with that. Its provisions are clearly dated. They do not underpin the environmental and climate challenge in anything like the rigorous way we would now want. There have also been rulings stating that when it deals with two member states it is inconsistent with the treaties on which the European Union is founded, so to take a dispute resolution under this treaty among two member states would not be robust.

While it is easy to see the flaws and the need to move on and withdraw, as the Commission is now recommending, we need to go back to some of the deeper principles here to consider what we need to do to replace this. It certainly seems to me that as we look to the future we will continue to need to build networks and have both public and private investment, not necessarily all from within the European Union, in order to secure the sort of renewable energy transformation we all want to see. When we move away from this, we need to ensure people can invest in confidence. From an Irish perspective, with this very substantial wind asset we hope to develop, it is absolutely crucial that we have these interconnections into other jurisdictions. Our nearest island, where we have forged significant interconnection, is not a member of the European Union. I do not think issues arise as to the security of mutual investment between ourselves and the UK but as international co-operation develops and as we seek to harness global renewable sources and do it in the most cost-effective way, we are going to see changes.

I recently read an article by Eddie O'Connor which set out the challenges of building those new networks if we are to do so efficiently. We need to think about what sort of underpinning will be needed to attract both the public and private capital for those investments. That is a very significant issue not just in the energy sphere but in other areas where we have to make transformative change. We have talked about forestry, for example. We clearly have not yet reconciled how we will have international and national investment in the forestry sector that is consistent and supported. We had a lot of controversy about the investment that I think was developed in good faith with a private body but the feeling was very strongly expressed in this House that support of that nature should be confined to farmers. We need to attract money into investment to create the transformative change that will be needed across so many sectors. We need to think about how we are going to secure that. This charter is redundant but I do not think we in Ireland have yet worked out the approach we should adopt in attracting very substantial amounts of investment for the transformation we need.

The corollary of that, of course, is how we address the issue of just transition. At the heart of what is happening here is that we are being obliged to turn away from sectors we allowed to develop to a very considerable scale, whether we did so wittingly or unwittingly. I do not think anyone would be fully satisfied with how we have managed the exit from peat, which is a particular case in context. The exit was driven to a considerable extent by the courts. I was in government at the time and we created the role of the just transition commissioner and we tried to manage that change. Clearly there is unhappiness when we do not plan this sort of change sufficiently in advance. When a change like that happens as a result of a court decision, there is considerable fallout for people who have been making their living and considerable hardship.

At the same time as we say goodbye to an energy charter treaty with all its flaws, we need to understand better what principles we will apply to the future in creating a just transition for the many people who are going to be profoundly impacted by the transformational change. The exit from peat is only the foothills of the sort of change we are going to have to envisage. We need to see the legislation underpinning a just transition commissioner and those principles.

Clearly the State cannot compensate everyone. It would be extraordinary to pretend the State can compensate people for all the stranded investments or stranded practices that have to be abandoned. Nonetheless, we have to develop some principles that will be seen as fair and will give people the confidence to see a future for themselves as they move in another direction.

We still do not have a picture of what prosperous farming will look like in ten, 15 or 20 years so that people can have confidence that, as the State undertakes major transformational change, they can see a future for themselves in it. We need to think more in this House about what policy tools will be put in place to smooth the transition we have to make to ensure people will not find they are being continually frustrated and facing protests and attempts to undermine necessary change. While I absolutely recognise the need to say goodbye to the Energy Charter Treaty and some of its principles, we need to develop new principles that can give investors here and overseas investors who choose to invest here the confidence that this transformation is underpinned by principles of fairness and equity, which was the original thinking behind the treaty.

I welcome this debate because it is timely. We need to think more deeply about the transformative change we are undertaking. I commend both the Minister and the Minister of State on the work they are doing and the plans and policy initiatives they are putting in place, but the wider framework needs the support of both the Government and the Opposition so we can see a context in which difficult changes can be adopted and implemented by Ireland and we can genuinely lead in the green transition.

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