Catherine Murphy (Kildare North, Independent)
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To ask the Minister for Communications, Energy and Natural Resources his views on the fact that his plan of phasing out the subsidisation of home energy retrofit without a suitable pay as you save replacement facility in place has had a detrimental effect on employment in the construction and retrofit sector which has created sustained employment for 5,000 people over the past four years; his plans to expedite the introduction of the planned pay as you save home retrofit scheme; if so, if he will offer details of the scheme; if he has had any consultations with the Deprtment for the Environment, Community and Local Government in terms of the utility such a programme can offer as part of a national CO2 emissions reduction plan in the context of climate legislation; and if he will make a statement on the matter. [53528/12]

Pat Rabbitte (Dublin South West, Labour)
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The Government, through the Sustainable Energy Authority of Ireland, SEAI, has invested over €145 million in Better Energy Homes and its forerunner schemes since 2009. The existing scheme is demand-led, with €76.146 million committed in Exchequer funding this year.

Better Energy Homes provides financial assistance for improving the energy performance of older homes built any time before 2006. The scheme enables homeowners to save money, while improving comfort and reducing harmful greenhouse gas emissions. It also promotes employment in the construction sector. The programme for Government commits to a phased transition from grants to a pay-as-you-save scheme after 2013. Following on from work completed last year, a project team has been established to bring forward a scheme design for the Government’s consideration by the middle of next year.

It is important to note that no measure has as yet been removed from the list of those supported since the Greener Homes scheme was subsumed into the wider Better Energy Homes scheme. Reductions in grant value have been made, but this is to ensure grant supports are in line with the reduced market prices. Clearly, it is essential that the transition from an Exchequer supported industry to one that is sustainable takes place in an orderly manner and it is the case that the SEAI will continue to operate its current schemes during 2013. Central to this will be engagement with stakeholders, including the Department of the Environment, Community and Local Government. The project team put together draws heavily on industry expertise.

The Better Energy Homes scheme has successfully supported the creation and retention of a large number of jobs in the past few years. These jobs have been underpinned by Exchequer capital funding provided via my Department’s Vote. In the light of the general pressure on all Exchequer expenditure and other demands on my Department’s Vote, including in future years in the area of broadband provision, new and innovative funding models must be pursued to ensure maintenance and enhancement of energy efficiency schemes. What is required is a retrofit model that is both sustainable and attractive to the consumer, which is why my Department is working closely with industry and stakeholders, including the banks, to design a scheme that does both. The protection of jobs is a key objective of the pay-as-you-save scheme and underlines the importance of a strong value proposition for consumers in the scheme’s final design.

Catherine Murphy (Kildare North, Independent)
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This scheme has the potential to be a winner on three fronts: job creation, the environment and in making it more affordable for people to heat their homes. Essentially, as the Minister said, the Better Energy Homes scheme replaced three other schemes. Within that context, there was a reduction in the amount available and, in fact, the grant rates were cut twice last year. I have several questions. The changes taking place and the lack of certainty seem to be impacting on the level of confidence in the scheme. For example, there has been a considerable reduction in the number of calls and inquiries to theSustainable Energy Authority of Ireland from some 500 to 100 a day. This suggests something to us. The absence of continuity and certainty in transitioning from one scheme to another is impacting on people's ability to plan to employ themselves in this market. Is all of the €76 million committed to be drawn down this year? Does the Minister have information readily available on how many grants this sum would cover? It is as if we have stopped in the middle and are transitioning to something else, yet at the same time it appears that while the scheme to move towards the industry model was ready prior to the Government taking office, it will now be 2014 before it is rolled out. This has not provided the confidence people involved in the industry and those who would potentially employ themselves in it want.

Pat Rabbitte (Dublin South West, Labour)
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The Deputy is right to draw attention to the value of these schemes and also to point to the fact that there has been a decline in the number of applications this year. However, she is wrong in somehow persuading herself, as she has done in the question, that it is due to a lack of continuity. Whatever it is, it is not due to a lack of continuity and it is not the case that the pay-as-you-save scheme was ready before we went into government.

The scheme is still not ready. It is a complex issue. In any event, we did not want it to be ready because we are still operating a grants-based incentive scheme for people to insulate and retrofit their homes so they make energy savings, and as Deputy Catherine Murphy said, that they can live in their homes with more comfort. I accept the grant was moderated this year, but it was done because the price of doing that kind of job is now less than it was three to five years ago. We are trying to ensure that the money goes as far as possible. I remind the House that I invested an additional €30 million into the scheme last year. Far from cutting it, we put in €30 million extra in the jobs initiative in the middle of last year. A total of 5,500 people were supported last year.

I suspect what the Deputy is really interested in finding out is the reason for the apparent fall-off in applications. That is her net point. I am interested in it too. I find it difficult to come up with experts who can provide a reason. Two major reasons have been advanced. The first is that last year there was a particularly mild winter. Anytime there is a particularly harsh winter such as the two previous ones, there is a spike in demand and then it falls off. The second reason is the recessionary climate where people are reluctant to put their hand in their pocket. Even if one gets grant funding one still has to fund the work by a factor of 2:1. If one gets a grant, for example of €4,000, one is expected to come up with €7,000 or €8,000 to do the job. In the present climate people are reluctant to spend that kind of money. That is one of the advantages of the pay-as-you-save scheme. The idea of the pay-as-you-save scheme is that householders are not expected to put money upfront. They repay it from the energy savings that have accrued over a period. We must try to make the product attractive to the householder.

Catherine Murphy (Kildare North, Independent)
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Will grants still be available once the new scheme is fully rolled out? People might wish to take up the other type of scheme.

I do not know whether the Minister has been listening to the pre-budget discussions from around the country on “Morning Ireland”.

Pat Rabbitte (Dublin South West, Labour)
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Oh my God, Deputy Murphy would not inflict that on me.

Catherine Murphy (Kildare North, Independent)
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Utility bills are coming up as a key issue every morning. It strikes me that the grants scheme is precisely the type of measure the vast majority of people would want if it were put in place quickly. While the scheme might not save people money immediately, they are conscious of the cost of energy and the scheme is a means of eventually saving. I am not convinced by the weather argument.

Pat Rabbitte (Dublin South West, Labour)
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I listen to Lyric FM in the morning. It is one thing having half the population of the country being depressed by the unending dirge of misery and negativity one gets from 7 a.m. until midnight, without me being depressed because we would have no hope at all if that were to happen. I did not hear the programme but I will take Deputy Murphy’s word for it that it was as dismal as she suggests.

She is correct; this is one thing that could be done. In a country that imports its fossil fuels what we can do to affect the price of oil or gas on the world markets is limited, but we can make savings in energy and we can use energy more efficiently. That is what we are trying to do.

There is no doubt that the scheme will continue. I am currently locked in mortal combat trying to hold on to as large a budget in this area as I can for next year. I do not see it being a clear ending on 31 December 2013 and on 1 January it is a brave new world. I do not think it will happen that way.

I am worried that there is a third factor at play in the point raised by Deputy Murphy, namely, that the category of householder who like her is energy aware and wants to get the job done, is gone in the first flush of applications, and that we will have to evangelise to get the next tier. That is an issue as well.