Thomas Pringle (Donegal, Independent) | Oireachtas source

I move:

That Dáil Éireann:

acknowledges that: — the Fossil Fuel Divestment Act 2018 is something that Ireland should remain proud of in its capacity of setting a global standard;

— the purpose of the Act was to mandate the movement of financial investments by the Ireland Strategic Investment Fund (ISIF) away from fossil fuels, thus encouraging continued future investment in renewable energy and infrastructure; and

— the United Nations (UN) reports that fossil fuels, namely coal, oil and gas, are by far the largest contributor to global climate change, accounting for over 75 per cent of global greenhouse gas emissions and nearly 90 per cent of all carbon dioxide emissions;

further acknowledges that:

— there is an urgent and necessary requirement to amend the Fossil Fuel Divestment Act 2018;

— the purpose and ethos of the Act is being undermined by the exploitation of legislative loopholes found within the wording of said Act;

— the Act is principally concerned with fossil fuel exploration only, as opposed to all fossil fuel use, with a limited exception, which essentially still allows for investment from the ISIF in fossil fuel use;

— section 49A (1) of the National Treasury Management Agency (Amendment) Act 2014 (as amended by the Fossil Fuel Divestment Act 2018) contains an exclusionary clause that permits indirect investment in fossil fuel undertakings to be made in financial derivative instruments, exchange traded funds or hedge funds;

— while the Act in its original form brought about significant change, reviewing it in practice over the last five years has afforded us insights into issues that must be addressed;

— on January 2023, Irish financial institutions held US$13.2 million in bonds and shares attributable to fossil fuels in the Global South, of this the ISIF held US$11.2 million, mostly in bonds issued by Chinese electric utility company State Grid Corporation of China;

— at the beginning of 2023, the ISIF also held US$12.5 million in bonds and shares attributable to agribusiness in the Global South, of this the ISIF held US$12.1 million and Waystone34 accounted for the majority of the remaining investments;

— these investments are contrary to the spirit of the 2018 Act and demonstrate that investments are still being made in the fossil fuel industry and therefore the Act must be amended to ensure that such loopholes cannot be availed of via indirect investment and financial vehicles;

— although falling outside the scope of the 2018 Act, reports show that investment managers registered in Ireland held US$6.2 billion in bonds and shares attributable to fossil fuels and agribusiness in the Global South alone, which indicates that the Fossil Fuel Divestment Act 2018 is an important step but a modest one;

— as outlined clearly in the 2023 ActionAid Report, How the Finance Flows: The banks fuelling the climate crisis, there is a significant need for the Government to consider the scope of the Act and the Act should extend beyond fossil fuel "undertakings" to include "fossil fuel utilisation", which should be defined in a manner that targets economic entities that fall within an agreed bracket so as to strike a balance that allows for meaningful climate policy while acknowledging any existing barriers within the renewable infrastructure;

— a limitation of the 2018 Act is that investments in companies that depend on fossil fuels, such as agribusiness and agrichemical companies, are not prohibited by the Act thereby allowing for the continued financing of environmentally damaging activities;

— industrial agriculture, and the unsustainable food system that it supplies, is also a major source of greenhouse gas emissions, with the Intergovernmental Panel on Climate Change reporting that the agriculture, forestry and other land use sector accounts for 13-21 per cent of greenhouse gas emissions globally from four main emissions sources: carbon dioxide emissions from land use change, including deforestation to make way for agriculture; the production and application of synthetic nitrogen fertilisers ("fossil fertilisers") and agrochemicals; livestock emissions from enteric fermentation and manure; and methane emissions from rice paddies;

— industrialised agriculture globally is typified by large-scale plantations; widespread application of agrochemical fertilisers, pesticides and herbicides; hybrid or genetically modified seeds sold by corporations which need to be purchased anew each year; mechanised farming; monocultures of single crop varieties covering hundreds of hectares; and commodity crops destined for export, with corporations known as "agribusinesses" controlling and profiting from almost every step of the process; and

— Ireland is ideally placed to start the process of getting the proposed Fossil Fuel Non-Proliferation Treaty initiative on the diplomatic and UN agenda given its commitment to climate action, rejection of further offshore exploration licences and its membership of the Beyond Oil and Gas Alliance diplomatic initiative;

calls on the Government to:

— signal its commitment to a sustainable, resilient, and zero-carbon future by endorsing the development of a Fossil Fuel Non-Proliferation Treaty and joining the bloc of states seeking a negotiating mandate;

— amend the Fossil Fuel Divestment Act 2018, in a manner that will widen its reach so that it is applicable to all funds within the ISIF, by removing the exclusionary clause within section 49A (1) of the National Treasury Management Agency (Amendment) Act 2014 (as amended by the Fossil Fuel Divestment Act 2018) regarding financial derivative instruments, exchange traded funds or hedge funds;

— ensure meaningful steps are taken to protect the climate and our children's future, while acknowledging the significant role of small and medium-sized enterprises and Ireland's agri-economy; and

— ensure that the investments made by the ISIF are not being made in a way that is contributing to the alarming damage that fossil fuels and agribusiness are proven to cause; and

further calls on the Government to:

— incorporate a provision to allow for a review of the Act every 3-4 years to ensure that the purpose and impact of this legislation is being carried through;

— ensure that it reviews and analyses relevant structures and processes to ensure that investment made through Foreign Direct Investment and international subsidiaries based in Ireland do not undermine our climate and development objectives;

— consider new regulations and policies to phase-out financing to fossil fuels and steer away from harmful industrial agriculture and other high-emitting activities, which should include a requirement that banks and other financial institutions operating in Ireland develop climate transition plans consistent with a 1.5° Celsius climate goal and which should cover all financed emissions with no offsets, and be subject to sanctions for non-compliance; and

— ensure a coherent and equitable approach to preventing emissions at source and a coordinated just transition globally.

I thank the Leas-Cheann Comhairle.

We’re at a tipping point, and if countries fail to commit to a full fossil fuel phase-out, the future is bleak ... It is not good enough to use weak language or to permit loopholes for the fossil fuel industry to continue to contribute to the very problem countries are meant to be committed to tackling.

These were the words of Mary Robinson last month in respect of COP28, which held its final negotiations yesterday and which, in my opinion, was a complete farce. We face a terrifying reality, not just because our world is changing and becoming increasingly volatile and unliveable but because many of those who are supposed to be leading the fight against climate change are at best watery on climate commitments and at worst verging dangerously towards climate denial.

The fact the president of COP28, Sultan Al Jaber, has claimed there is “no science” indicating a phase-out of fossil fuels is needed to restrict global heating to 1.5°C is incredibly worrying and just is not true, according to years of research. The argument we simply cannot live without fossil fuels is not true either. It will require major change, but that fact cannot escape the fact we have no other choice. Our world is changing, whether we like it or not, so we can either change with it or allow our children to face the consequences. The announcement yesterday of an agreement at COP is welcome and makes this motion more timely, but the wording remains very weak. Indeed, in the wake of COP28, this motion is very timely, and I would ask those who contribute today to consider its importance and the importance of their words and leadership as public representatives. We have a duty to inform our constituents about the future of this planet in the best and most honest way we can, without the spread of mistruths or unnecessary scaremongering.

I am delighted to introduce today’s motion on increased fossil fuel divestment. I was very proud to introduce the Fossil Fuel Divestment Act 2018, landmark legislation that was an important and notable step forward in ensuring our laws reflect the national commitments made in tackling global warming and climate change. It was a proud moment for Ireland and it made this country a global pioneer in divesting public money from fossil fuels. Let us be clear, however; it was a modest step towards our goal.

Unfortunately, the legislation was not successful in divesting completely from fossil fuels. Since the enactment of the Fossil Fuel Divestment Bill in 2018, investments are still being made. At the beginning of 2023, the Ireland Strategic Investment Fund, ISIF, held $12.5 million in bonds and shares attributable to agribusiness in the global south. Of this, the Ireland Strategic Investment Fund held $12.1 million dollars, with Waystone accounting for the majority of the remaining investments. This is largely due to the ability of investment managers and funds to take advantage of the exclusionary clause regarding indirect investment for certain financial vehicles such as hedge funds and pension funds. The main loophole in the 2018 Act is that the Act contains an exclusionary clause that permits indirect investment in fossil fuel undertakings to be made in financial derivative instruments, exchange traded funds or hedge funds. While an outright investment, therefore, in a particular fossil fuel undertaking is prohibited, an indirect holding through a hedge fund is permitted. This undermines the overall intention behind the 2018 Act and is completely against the spirit of it.

Recently published research by ActionAid shows European banks have provided a staggering $327 billion of financing to fossil fuel and agribusiness activities in the global south in the seven years since the Paris Agreement, with $6.2 billion coming from financial institutions in Ireland. Ireland needs to address this as a matter of urgency, along with working with any EU regulation. Amending the 2018 Act would be a clear and meaningful action towards ensuring proper divestment, and that is what today’s motion calls for. Without closing these loopholes, investment in fossil fuels will continue and our apparent commitment to stopping environmental endangerment caused by fossil fuels will become little more than lip service.

I understand that some Members of this House would rather we moved tentatively when it comes to finding the balance between enterprise and the environment, but the cold, hard facts of the matter are that our climate is changing and fossil fuels are significantly responsible. For a long time the threat and reality of the situation was easy to dismiss in temperate, rainy Ireland. There is a deep injustice in this, given that those who have done the least to cause this climate crisis and who have the least capacity to absorb and recover from its impacts are suffering the most from them.

Even Ireland is now beginning to feel the effects of climate change. Heatwaves scorched the country this summer, not even reaching the highs our neighbours on the Continent are experiencing year on year, and as a result wildfires had devastating effects on places such as Greece and Hawaii. This was followed by weeks-long deluges. October saw Donegal and other parts of the country reach highs of 20°C. We may have joked about how nice it was, but our farmers felt the impact on their crops. Our countryside and ecosystem battled to recover. Climate legislation is not anti-farmer; it is pro-farmer due to the fact its main aim is to protect the land on which so many farmers rely to provide us all with food. Winter storms and floods are becoming more and more frequent. Homes and businesses are under water with such regularity that people cannot even get insured. Just a few days ago, a localised tornado caused significant damage in County Leitrim. Every year is more volatile and increasingly extreme, and this is just what we are experiencing in Ireland. All of it is, without a doubt, due to climate change.

The United Nations reports that fossil fuels, namely, coal, oil and gas, are by far the largest contributor to global climate change, accounting for more than 75% of global greenhouse gas emissions and nearly 90% of all carbon dioxide emissions. While the statistics on fossil fuels are shocking, they are also very well known and acknowledged. I am not saying anything controversial or unknown today. All the facts and statistics have been widely published and accepted. Many organisations have done much of the heavy work by producing such fantastic and thorough research, and I would like to take this opportunity to thank Trócaire and ActionAid, whose research constitutes most of this motion and which provided me with great assistance in its drafting. Their support and that of the public show just how important it is that Ireland continues to be a world leader in fossil fuel divestment.

After fossil fuels, agribusiness is the largest contributor to climate change. The EPA reports that in 2022, in Ireland alone, the agriculture sector was directly responsible for 38.4% of national greenhouse gas emissions. Giant agribusiness corporations, which have an industrialised approach, are responsible for the bulk of emissions in the sector. Industrialised agriculture drives deforestation and expands factory farming. To do so, companies aggressively market agrochemicals, which leads to high volumes of greenhouse gas emissions. The industrialised agribusiness sector uses fossil fuels to produce these agrochemicals. This is just one example of the interdependence of fossil fuel and agribusiness industries.

I am aware that any discussion on agriculture here is of great interest, and rightly so. That is why this conversation is so important and of particular relevance to Ireland, a farming nation. The farming industry needs to recognise that the giant agribusiness sector undermines smallholder farmers. Farms that implement agro-ecological farming systems are having their efforts thwarted by the giant industrialised farming mechanisms that undo their good work a hundredfold. The financing of fossil fuels and industrial agriculture actively contributes to and causes catastrophic environmental damage. It exacerbates the impacts of climate change that are already devastating communities and risks locking countries into building expensive and debt-dependent infrastructure rather than developing alternatives.

Perhaps the increasingly rapid threat and demise of our environment is still not a sufficient motive to vote in favour of further environmental protections, in which case let us consider the money. Research shows moving slowly on policy and environmental implementations may be of detriment to financial investments as well as the climate.

Due to the global transition toward a more sustainable economic and environmental model, fossil fuel investments are becoming increasingly less attractive. While Ireland helped to lead the way with the enactment of the Fossil Fuel Divestment Act in 2018, international governments and the global financial world are actively pursuing greener and more environmentally conscious enterprises. Fossil fuel investments are now being consistently outperformed by renewables. According to Forbesmagazine, investment in renewable power continues to outperform fossil fuel investment across the globe. This is based on statistics showing that investment in renewables has a return seven times higher than investment in fossil fuels. This trend has been corroborated by numerous studies, including by Imperial College London and the International Energy Agency, which have found that investment in renewable energy technology significantly outpaces investment in fossil fuels. The reason for this is largely due to affordability and security concerns triggered by the global energy crisis. What this tells us today is that our decision is essentially a simple one. Removing the indirect investment exclusion clause will mean that investment funds and managers will no longer be able to utilise financial vehicles to indirectly invest in fossil fuels.

However, the data shows that the trend is pointing squarely towards renewable energy investment outpacing fossil fuels. Furthermore, it is important to remember that the proposed amendment is not curtailing all investment, merely that which circumvents the spirit of the original Act.We do not exist in a vacuum, and nor do our policies. The decisions we make here affect millions of people across the world. In amending the Fossil Fuel Divestment Act, we would ensure that its intended purpose is achieved and our approach to climate policies is cohesive. If we wish to keep the target of 1.5°C as realistically achievable, we need to phase out fossil fuels. The amendments needed in the Fossil Fuel Divestment Act are merely one step that we can take as legislators to do our part, but mark my words, this is the bare minimum we can do.What is required is a workable, considered roadmap on how governments can achieve this on a larger scale. The fossil fuel non-proliferation treaty provides a global plan for what is required to achieve an equitable phase-out of fossil fuels. The treaty will provide a working guide for governments to stop the expansion of fossil fuels, while also achieving true transition to renewable energy.

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