Thursday, 12 July 2018
Fossil Fuel Divestment Bill 2016: Report and Final Stages
I move amendment No. 1:
In page 3, to delete lines 13 to 28 and substitute the following:
"(a) in section 49—(i) in paragraph (f), by deleting the second instance of the word "and",
(ii) in paragraph (g), by substituting "Fund, and" for the word "Fund.", and
(iii) by inserting the following paragraph after paragraph (g):"(h) measures taken in accordance with section 49A, as inserted by the Fossil Fuel Divestment Act 2018.",and
(b) by inserting the following new section after section 49—
“Investment in Fossil Fuel Undertakings49A. (1) In this section—‘fellow subsidiary undertakings’, ‘higher holding undertaking’, ‘holding undertaking’, ‘subsidiary undertaking’ and ‘undertaking’ have the respective meanings given to them by the Companies Act 2014;‘group’ means an undertaking together with any holding undertaking, higher holding undertaking, subsidiary undertaking and fellow subsidiary undertakings that such undertaking may have;
‘fossil fuel’ means coal, oil, natural gas, peat or any derivative thereof intended for use in the production of energy by combustion;
‘fossil fuel undertaking’ means an undertaking which is—
(a) engaged, for the time being, in the exploration for or extraction or refinement of a fossil fuel where such activity accounts for 20 per cent or more of the turnover of that undertaking, as derived from its most recently published audited financial statements,
(b) a holding undertaking or, as the case may be, a higher holding undertaking of an undertaking of the kind referred to in subparagraph (a), or
(c) a holding undertaking or, as the case may be, a higher holding undertaking of undertakings engaged, for the time being, in the exploration for or extraction or refinement of a fossil fuel, where the aggregate turnover of such undertakings accounts for 20 per cent or more of the turnover of the group on a consolidated basis, as derived from its most recently published audited financial statements;
‘indirect investment’ means an investment of the assets of the Fund in an investment product or in a collective investment undertaking but does not include financial derivative instruments, exchange traded funds or hedge funds;
‘national transition objective’ has the meaning given by the Climate Action and Low Carbon Development Act 2015;
‘State’s climate change obligations’ means the existing or future obligations of the State referred to in paragraphs (a) and (b) (insofar as the obligations of the State referred to in paragraph (b) relate to climate change) of section 2 of the Climate Action and Low Carbon Development Act 2015;
‘turnover’ in relation to an undertaking or a group of undertakings means the amount of revenue derived from the provision of goods and services falling within the ordinary activities of the undertaking or group of undertakings, after deduction of—(a) trade discounts,(2) (a) The Agency shall endeavour to ensure that the assets of the Fund are not directly invested in a fossil fuel undertaking.
(b) value-added tax, and
(c) any other taxes based on the amounts so derived.(b) Where the Agency becomes aware that an undertaking in which the assets of the Fund are directly invested is or becomes a fossil fuel undertaking, the Agency shall divest the assets of the Fund from such investment as soon as practicable.(3) The Agency shall endeavour to ensure that the assets of the Fund are not invested in an indirect investment at any time after the commencement of this section, unless it is satisfied on reasonable grounds that such indirect investment is unlikely to have in excess of 15 per cent of its assets, or such lower percentage as the Minister may prescribe by order made under this section, invested in a fossil fuel undertaking.
(4) Notwithstanding subsections (2) and (3), the Agency may invest the assets of the Fund in a fossil fuel undertaking or in a collective investment undertaking the assets of which are invested or will be invested in a fossil fuel undertaking, where the Agency has satisfied itself on reasonable grounds that the investment is intended to be consistent with—(a) the achievement of the national transition objective,(5) Where the Agency makes an investment which, but for subsection (4), it would be prohibited from making, it shall when publishing the fact of the investment and the name of the fossil fuel undertaking or collective investment undertaking concerned, publish the fact that the investment is made under subsection (4).”.”.
(b) the implementation of the State’s climate change obligations, and
(c) the policy of the Government, as may be communicated to the Agency from time to time by the Minister for Communications, Climate Action and the Environment, in relation to climate change and climate change objectives.
The amendment will replace the Bill as introduced on First Stage. I am grateful to all Opposition parties and colleagues who ensured this Bill passed the critical Second Stage and engaged seriously and consistently on it throughout the process, leading to today.
I also acknowledge and welcome the constructive recent engagement by the Government, the Minister for Finance, the Department of Finance and the Ireland Strategic Investment Fund that has enabled this Bill to proceed with what we hope will be cross-party support today.
I will briefly outline the provisions contained in the amendment, how they evolved and my understanding of their intent and application if that is agreeable.
The first provision is new as compared with the original text of the Bill. It sets out an obligation on the Ireland Strategic Investment Fund, ISIF, to include reporting on measures taken in implementing the Act through annual reporting by the ISIF to the Minister for Finance.
The proposed new section 49A(1) contains all of the definitions. Key changes in this section relative to the Bill as originally published are that there is now a definition of "fossil fuel" whereas the original text referred simply to "geological deposits".
The scope of activities used to define a fossil fuel company in the text - now referred to as an "undertaking" for consistency with the Companies Act - under the Bill have been narrowed from the original Bill text which read, "a company whose business either wholly or partly engages in exploration, extraction, refining, processing or delivery". It is now narrowed to the definition "exploration, extraction or refinement". I accepted this narrowing to address concerns raised by a number of parties about avoiding potential unintended consequences, for example, for SMEs, of a very broad definition. The definition also now provides further precision by setting a numeric threshold for the amount of revenue derived from fossil fuel exploration, extraction or refinement necessary for an undertaking to be defined as a fossil fuel undertaking. This was requested by the ISIF for legal certainty. I would like to note that the 20% revenue threshold for a fossil fuel company in the text is welcomed as being at the progressive end of current investment or divestment practice.
In agreeing to legislate for divestment, the Oireachtas is seeking to ensure that the ISIF will be at the cutting edge of low-carbon investment in the long term. In ten or even five years' time, it could well be - we hope this will be the case - that the 20% threshold will be significantly unambitious following anticipated shifts in international practice. It would be important, therefore, that the ISIF, in the spirit of this Bill, proactively acts in its investment strategy in the years to come to invest under progressively lower thresholds in order to remain at the progressive end of international investment policy and practice.
The definitions section includes a definition of "indirect investment". I have made significant efforts to find consensus with the Department and the ISIF to ensure that indirect investments are included in the Bill while acknowledging the need to ensure that the ISIF retains the ability to use certain indirect investment products in the short term in order to manage risk. In the dialogue with the Department and the ISIF, I sought means within the legislation to ensure that while certain products will be exempt in order to allow the ISIF to have the certainty of flexibility to allow it to manage risk, it will be obliged to ensure, as far as is practicable, that, when availing of them, these products, where they exist and are appropriate, are fossil fuel-free and as low-carbon as possible where they do not. It was argued that explicit legal certainty on the ability to avail of these instruments was needed. In good faith, I have accepted the exclusion of these indirect investment products. I would like to state on the record, therefore, my expectation that, in equal good faith, notwithstanding this definition, the ISIF will seek to avoid or limit as far as possible and as far as is practicable exposure to fossil fuel investments through these products.
The word "company" has been replaced throughout the text with the term "undertaking" for consistency with the Companies Act 2014 and the Climate Action and Low Carbon Development Act 2015.
In the proposed new subsection (2), the divestment provisions for direct and indirect investments are separated out in the amended text. In the text of the Bill as drafted, they are dealt with by means of the same provision. As drafted, the text obliges the ISIF to divest as soon as practicable without incurring contractual penalty. Our understanding is that this will take place within five years at most, but most likely earlier than that.
For indirect investments, in the proposed new subsection (3), a specific numeric threshold for acceptable exposure through indirect investments was requested, recognising that ensuring zero exposure at all times is difficult. I was cognisant of the need to address this issue but I was not satisfied with the 15% figure put forward. As fossil fuels typically represent approximately 6% to 7% of funds, exposure higher than this percentage means that a fund is overweight in the context of fossil fuels. Thus, the Bill could be used to allow the ISIF to be overweight in fossil fuels as compared with international averages through its indirect investments. I have been assured that the 15% threshold is intended as a limit rather than a goal. However, it would be important once again that the ISIF operates under the spirit of the Bill and endeavours to be 100% fossil fuel investment free, with zero or as close to zero exposure as possible. Furthermore, in light of concerns raised, it was accepted to include provision for a statutory instrument to allow the Minister to review this threshold downwards in time, as appropriate.
The transition provision in subsection (4) of the amendment is new. The aim of this new provision is to ensure that the ISIF can invest domestically in activities required for Ireland’s transition where these are essential to phasing out fossil fuels. This was formulated in response to concerns raised on Second Stage and during pre-legislative scrutiny. For this reason, the provision requires that the ISIF be satisfied in advance of a decision that the proposed investment is in line with the national transition objective, Ireland’s climate change targets and national climate policy as it evolves.
Finally, the proposed new subsection (6) obliges the ISIF if investing using the transition flexibility set out in the proposed new subsection (4) to explicitly and publicly acknowledge at time of announcing the investment decision that this has been possible only as a result of the transition flexibility provision in the Fossil Fuel Divestment Act.
As with any legislation at this stage in the process, compromises have been made but I am satisfied that this amendment represents a solid outcome that will see Ireland make a significant contribution to the global fossil fuel divestment movement. The movement is highlighting the need to stop investing in the expansion of a global industry which must be brought into managed decline if the limits to warming set out in the Paris Agreement are to be delivered and catastrophic climate change averted.
I have just one final point. In domestic terms, the Bill places a significantly increased onus on the ISIF, other State bodies and, importantly, the Oireachtas to seek to achieve significantly higher levels of due diligence, transparency and accountability in the energy policy and investment decisions that will be taken in the coming years. These are decisions that will determine whether the battle relating to the Paris Agreement goals will be won or lost.
While Deputy Pringle's Bill involves divestments relating to fossil fuels, the crux of the debate is climate change. Five years ago when Ireland held the EU Presidency, I attended a conference organised by the Mary Robinson Foundation in association with Irish Aid and the World Food Programme entitled "Hunger, Nutrition and Climate Justice". It was an innovative conference because as well as bringing key leaders into the conference, more importantly it brought the people who are living in those front-line communities directly affected by climate change and the hunger, poverty and displacement that comes from that. That relationship was very apparent. Delegates from approximately 100 developing countries spoke at that conference. They were farmers, pastoralists and those from fishing communities who outlined what it is like to live with droughts, floods and unpredictable rainfall and how these affect agriculture and food security. There were stories from all over the world about the impact of climate change on people trying to make a living.
We know that the burdens of climate change are not distributed proportionately. Those least responsible are paying the most. This is causing starvation and malnutrition, which, in turn, affects people’s health and their ability to access education and to work - things we take for granted here. The central message was that hunger, nutrition and climate justice are development challenges that need to be tackled together.
In all likelihood, this Bill would never have got as far as it has today without new politics in Ireland. I do not believe that previous Dáileanna in which there were Government majorities would have entertained the Bill. However, the new politics has meant that there has been engagement on the Bill and that people have worked through the issues, compromised and built consensus in the context of considering amendments.
I acknowledge the work done by Deputy Pringle, who, with the assistance of Trócaire, has been the driving force behind the Bill. I also acknowledge the input of the Minister for Finance, Deputy Donohoe. There were considerable negotiations and some dilutions, but the principle is the same, namely, that there has to be pressure to keep fossils in the ground. Unless there is pressure to change, nothing will change.
Ireland has to move away from making excuses, including with regard to our carbon footprint. As I have stated previously, the position in this regard is highly ironic, particularly as Ireland played such a dominant role in negotiating and securing agreement on the sustainable development goals. There is a specific goal relating to climate change which relates to taking urgent action to combat climate change and its impacts. Climate change has to be tackled before any of the other goals can be realised. They came into effect in January 2016 and I would have to ask where the progress is. We will see how Ireland fares in the first voluntary national report.
The thrust of the Bill reminds me of one of the ways used to tackle drug dealing in Dublin central. As the late Tony Gregory said, we should follow the money and hit people in their pockets, which led to the setting up of CAB. Rather than empty rhetoric about targets, this Bill is going after the money and focusing on the money by preventing the NTMA, through its management of the Ireland Strategic Investment Fund, ISIF, from investing in fossil fuel companies. The ISIF, as a result of the Bill, will have to start that divestment process. The message the Bill is sending in Ireland, Europe and also further in the world is positive because there is a lot of interest in the Bill. It is an important step. It is essential, as NGOs such as Trócaire and many others tell us, so that the temperature limits agreed by Governments in the Paris agreement remain viable. The Bill is also an important step in signalling Ireland’s commitment to policy coherence. Irish Aid funds and supports and empowers communities overseas to deal with climate change but we also have to do our part in Ireland. The central point is that public money should not be invested in areas that are not in the public interest. It is not in the public interest for fossil fuels to be developed and supported. They need to be kept in the ground. We have all seen the extent of the correspondence on this which is a strong testament to the extensive interest in the Bill and its significance.
Another positive thing within the Bill is the definition of fossil fuel, which is comprehensive. Doing this today makes us stand out as a national Parliament. It is making an example. It will mean real progress. It also means we have to make real progress on the renewables.
The phasing out of fossil fuels has to be expedited, including the need to keep them in the ground. Ireland can do more - "do" is the key word - rather than talk about it because we have to uphold the principles of the Paris Agreement. The negotiations, the discussion and consensus that went on between the Department, Deputy Pringle and Trócaire on the Bill are a great testament that we are serious. I hope this is just the first in a number of other steps that show we are very serious about tackling climate change.
I have 11 Members indicating. We are discussing an amendment on Report Stage. We cannot have a Second Stage debate. I suspect that success has many fathers and mothers. I plead with Members to be succinct in their contributions. Our next contributor is Deputy Seamus Healy.
I will be brief. I am conscious of the fact so many Deputies want to speak on this. I welcome the Bill and commend Deputy Pringle on bringing it forward. He put a lot of energy and commitment into it over a long period of time. I know there has been a lot of engagement. He has engaged with all political parties and none across the House on it. The outcome is very important legislation. It is a short and symbolic Bill. Not only is it symbolic, it is significant. It is substantial legislation because it sends a very clear message out on climate change and climate justice. It prevents the fund from investing in fossil fuels in future. It ensures current investments will be divested over a period of time. It comes at a time when we know climate change is very important and that we in Ireland are not doing enough on it. The EPA recently indicated that by 2020 we will have achieved a reduction of 1% in emissions rather than the 20% target we agreed to under the EU agreement. A recent EU report places Ireland almost last on climate action performance.
About 10 million Ethiopians are now in need of food aid as a result of the lack of rain. I visited Ethiopia when my daughter was there doing voluntary work three or four years ago. It is happening not only in Ethiopia but right across the continent.
With those few words, I confirm my support for the Bill and the amendment.
I congratulate Deputy Pringle and welcome the Bill very warmly. That is probably a bit of a pun in this context but it is a hugely warmly welcomed Bill. The rationale is to send a clear signal that the phasing out of fossil fuels must be speeded up. Keeping fossil fuels in the ground is absolutely key. At this stage there is hardly anybody, apart from Deputy Danny Healy-Rae, Deputy Michael Healy-Rae and Donald Trump, who denies the science on climate change. I am hearing here that everyone else accepts the absolute science on climate change. Even the Taoiseach has said it is the greatest challenge facing humanity currently. If it is the greatest challenge facing humanity, this is the first step in taking that challenge head-on.
The other thing that is significant about it is the Taoiseach, the same man, has also said that Ireland is a laggard when it comes to dealing with our fossil fuel emissions, our CO2 emissions and our targets under the Paris Agreement. That is also true. If we are a laggard, we can now potentially become a leader. In the few minutes I have, I will ask the Government and the Taoiseach to be absolutely consistent and committed to this agenda because it should be at the heart of the work of every Department and for that we need joined-up thinking. That means that when a Bill is being considered, for example, the Heritage Bill that was passed the other night, it should be climate change proofed. I do not think that happened with that Bill. It was a disaster that the Bill passed. When we are looking at transport measures, they have to be climate change proofed. That means a huge investment in public transport and restoring the subvention to public transport not to in full but beyond that to the levels it was at in 2009. It means really aiming to take cars and trucks off the road. It would be a massive contribution to dealing with our emissions. The other obvious thing, which the Government is making some attempt to do but it is not quick enough and it is not sufficient, is to retrofit every home and building in the country so we have no need to burn as much gas and oil as we do to stay warm in the extreme cold of winter or to use other forms of electricity to keep cool in the extreme heat we are experiencing in the summer.
They are agendas on which we need joined-up thinking throughout Government, Cabinet and every Department and I appeal to the Government and the Taoiseach to change their minds about the approach to the Petroleum and Other Minerals Development (Amendment) (Climate Emergency Measures) Bill 2018, which I have put before the House. The purpose of that Bill is to try to end the extraction of all fossil fuels at sea and to challenge the oil and gas industry by telling it to leave it in the ground and that there is no need for us to take any more fossil fuels from the ground. I am not saying to turn off the lights tomorrow but let us take a serious, consistent, deliberate and decisive step in transitioning from our over-dependence on fossil fuels. We are like addicts. We are told it is dangerous and it is killing us but we will not give it up. If we continue to do that we will be on the cusp of losing an opportunity. Nature does not lie to us. Physics does not lie to us. We have to listen to nature and the science and begin to act deliberately and decisively. I appeal to the Government in the next term to reconsider its position on the Petroleum and Other Minerals Development (Amendment) (Climate Emergency Measures) Bill I have put before the Dáil. The fossil fuel industry is very powerful. The oil and gas industry has done a lot of lobbying and has a lot of influence. We need to challenge it and say enough is enough. We can use up what has already been extracted as we transition to full renewable energy but it should not take another drop of oil or gas out of our shores. It would also contribute to what Deputy Pringle has started, which is to put Ireland, along with other countries such as New Zealand, Costa Rica, France and Belize, in a movement that is beginning to wake up, smell the coffee and deal with climate change decisively and immediately. We do not get a second bite of the cherry.
I thank Deputy Pringle for all the work he has done.
The Ceann Comhairle will be glad to hear I will only speak on the amendment. I apologise for being late. We had a meeting of our new climate action committee. We had to work out the arrangements for it down in the bowels of Leinster House.
I support the amendment. It reflects well on the Dáil and the country that the Bill is about to be passed. It is good to see a full Public Gallery on a Thursday afternoon. I saw a young man up there wearing the green jersey.
We can wear a green jersey today with national pride because this is good legislation. This is good law.
I was just going to say that to Deputy Smith.
It is not just this Bill. Party leaders had an interesting meeting with the Taoiseach recently talking about good and bad legislation and I made the point that the good legislation is coming from this side of the House. Deputy Lawless has introduced legislation on digital transparency, Sinn Féin has introduced legislation on the islands, there were emotional scenes in the Seanad last night because Deputy Sherlock, with my colleague, Senator Grace O'Sullivan, put forward legislation on microbeads. Deputy Bríd Smith said she was fearful that her Bill may not get through. I say to her be not afraid because Deputy Dooley recognises that what we want to do on the west coast of this country is get investment into the alternative, cleaner future and not into oil and gas. We do not need that. It will not benefit our people. We have to make a decision on where we put our money. There is a clear majority in this House for putting our money in the clean, green alternative future. In fairness to the Minister and to Fine Gael, they recognise in this Bill that this makes sense and that is why I am speaking for the amendment. This is why it is a very good, powerful day because there is unanimity across this House on this issue.
When we unite we are strong. We have been strong on the Brexit negotiations because we have been together on it. We did the referendum to repeal the eighth amendment to the Constitution well because while there was not total unanimity it was handled in a proper democratic way. I am in favour of this amendment because it does say that politics can work in a better way in this country and it says very clearly that we have to divest. We have to start playing our part. That starts, as the great Bill McKibben says, for the environmental movement, in not always putting the onus on the individual but sometimes on the State and the lawmakers who by their laws make it easier for us to do the right thing. That is what Deputy Pringle's Bill does. I commend him and Trócaire and everyone else who has been campaigning for this. It is a proud, historic and happy day and this Dáil actually is doing some good stuff. We should keep at it and we serve our people well when we do.
This is a significant amendment which essentially rewrites the Bill's objectives and what we are hoping to achieve. The amendment reflects the very good debate we had on Committee Stage where we tried to tease out the key issues to make sure the Bill is workable. It is not just symbolic, or gesture politics, it has real meaning and will make a difference, albeit a modest one, but it is an important step nonetheless. The changes to the definitions are pragmatic, for example of what a fossil fuel undertaking is, what it is engaged in by way of "exploration for or extraction or refinement of a fossil fuel where such activity accounts for 20 percent or more of the turnover of that undertaking". That is one issue we went through in some detail on Committee Stage.
Indirect investment is a critically important part of this debate. That is dealt with in the amendment by setting a threshold of 15% to measure it, which is important too. The key point for its implementation is that the Ireland Strategic Investment Fund, ISIF, the National Treasury Management Agency, NTMA, the Department and the Government need to embrace this because there is discretion left to ISIF on the application of this, that it "shall endeavour to ensure that the assets of the Fund are not directly invested in a fossil fuel undertaking" and where it has investments as we know it does it "shall divest the assets of the Fund from such investment as soon as practicable". We need an assurance that ISIF will live up to the spirit of the legislation. That can be interpreted one way or another but we all know what the driving force and intention are behind this legislation. It is important that ISIF deals with that and embraces it fully because there is also provision under subsection (4) to make investment in fossil fuel undertakings if it is satisfied that it is consistent with several grounds, including "(a) the achievement of the national transition objective, (b) the implementation of the State's climate change obligations" and so on. There is discretion for ISIF. We need to know that this legislation will be embraced fully. The State needs to lead on this issue and while the impact of this Bill is modest it does make an important statement about the direction in which we wish to see policy going in the country, that is to reduce our dependence on fossil fuels, to invest in low carbon footprint technology, to invest in renewable technology and renewable energy. To be fair to ISIF, it has invested in companies that focus on renewable energy.
I warmly thank and congratulate Deputy Pringle on a fine piece of work. He has shown great patience in taking the Bill through the various stages. I know a great deal of work went on behind the scenes with the Minister and the Department to reach agreement on the substance of the amendment which has been put forward today. The role of Trócaire has been instrumental and in particular I acknowledge the work of Cliona Sharkey and Selina Donnelly. I thank Deputy Dooley, our spokesperson, who led the debate within our party and who strongly advocated from the very beginning that we adopt a supportive role on this legislation. I thank Deputy Pringle and all concerned. We hope that this is a seminal moment in respect of the State's attitude to this challenge for this and future generations. We are not living up to our responsibility and we know what the consequences are of not doing so. We have an opportunity to play a leadership role as a small, independent country. This is an example, in respect of this policy and the legislation, which has been spearheaded by Deputy Pringle, of how we can demonstrate that leadership. We will continue to play our role on this side of the House and in this party. I hope this legislation will pass and be enacted.
I congratulate Deputy Pringle on bringing the Bill through to this Stage. Even in this era of new politics not many Private Member's Bills get to Report and Final Stages. This is one of the few I have seen reach those Stages. I also acknowledge the work of Trócaire and the Stop Climate Chaos coalition and other non-governmental organisations, NGOs, and organisations that have been very involved in advocating for this and bringing it forward. Many of them are in the Public Gallery today and they are welcome. As Deputy Ryan said, it is great to see a full Gallery for our debate.
The Bill sends an important signal to the markets and to industry that Ireland is beginning to get serious about climate change. As well as being the morally right thing to do there is also a very strong emerging economic argument for this. If we embrace renewables a green energy revolution and an economic revolution, as well as an energy and environmental revolution, can take place, creating thousands of new jobs in the energy sector, renewable energy and supporting technologies. There is massive opportunity there. From a financial point of view it makes sense because more and more we see the phenomenon of stranded assets. The risk profile of fossil fuel funds is slightly different from what it might once have been. The World Bank recently announced that from 2019 on it will refuse to finance any further fossil fuel development projects, which is highly significant. It creates the possibility of stranded assets where people have invested and the shareholding becomes less valuable over time. As well as the moral and environmental imperatives there is a significant economic and financial argument.
It is an important Bill but it is only one step. It is very commendable but much more is needed. Professor John Sweeney of Maynooth University gave a presentation at a meeting of the Oireachtas Joint Committee on Communication, Climate Action and the Environment last week. One of the statistics he quoted from his research is that Ireland ranks 27th out of the 28 EU countries for progress on climate change. That is second last, very far from where we ought or need to be. We are only second behind Poland, which has a history of coal plants and fossil fuel.
Many other measures are needed. Deputy Bríd Smith has a Bill, the Petroleum and Other Minerals Development (Amendment) (Climate Emergency Measures) Bill 2018, colloquially known as the "keep it in the ground" Bill, which we support. Many other steps are also needed. As Deputy Eamon Ryan said, many of these measures are coming from the Opposition but what is really needed is a seismic shift in Government policy. It is the Government that has the driving wheel and it needs to move us in a different direction. From my experience on the Committee on Climate Action and here in the Chamber, there appears to be an approach from the Government sometimes of managing the fines rather than managing the problem. I asked the Taoiseach last year, on the Order of Business, what provision was being made for the fines that would inevitably accrue from failing to meet our 2020 targets.
The Taoiseach's rather glib response was to say that it would be dealt with next year because it was not a budget provision for this year. The time has come and it is now. We must get real and the Government must get serious about climate change. I do not think there are many remaining climate change sceptics at this stage, either in this House or anywhere else. The proof is before our own eyes. We had the biggest snowfall for 50 years in February and March and now we have the greatest heatwave for 50 years. The proof has been in the pudding, even for the last three months, and we are seeing it before our very eyes. I doubt many people are left that are sceptical. The proof is there, the need is there, this is a fantastic Bill and we are delighted to support it. Many other measures are needed and Government action is needed as well.
I am delighted to see this Bill reach fruition today. I thought it would right from the very outset because of the commitment of Deputy Pringle. He is owed a great debt of gratitude for the way he introduced this Bill and worked so hard on Committee Stage and with the Department to try to reach a conclusion that works. That is most important and my colleague, Deputy Michael McGrath, has already spoken on that aspect of the Bill. I want to be associated as well with the positive remarks regarding Ms Cliona Sharkey and Ms Selina Donnelly. They are two of the best advocates acting on behalf the environment in their work with this House. They are here regularly, always have a good story to tell and back up their assertions with facts and figures.
That makes our work much easier in attempting to convince colleagues, as it might be on occasion, and ensuring we are doing the right thing. Trócaire stands out but there are numerous other organisations represented here today as well that do fantastic work. I am singling out Trócaire because of the work it does and the attention it pays to the elected Members. We regularly get critical comments from others in what is often a very direct way. Trócaire does it with a little bit more of the carrot than the stick. It is proven that its work is well worth it. At the end of the day, as my colleague Deputy Michael McGrath has also said, this Bill is relatively modest in what it sets out to do but seismic in respect of the shift taking place in this House.
It has succeeded, as Deputy Maureen O'Sullivan said earlier, in bringing together people from different and disparate political backgrounds around a particular agenda and showing, notwithstanding our various different backgrounds, ideas, views and visions, that we can come together on the big issues and find an appropriate solution. This just a start. I also compliment Deputy Bríd Smith who also has a Bill on Committee Stage regarding leaving fossil fuels in the ground. Fianna Fáil has supported, and will continue to support, that Bill. It will need more refinement and work but that is what the committee process is all about.
It is moving the agenda towards ensuring that at long last, we seek to address the climate change we all accept is happening. There are alternatives and it does not have to be a big negative on our economy. The green agenda and the green economy present an opportunity to provide employment. We must recognise there is a resource already blowing off the west and east coasts and it is about harnessing that resource and generating clean energy from it. We have much more to do to address the targets we are, unfortunately, going to miss for 2020 and, I suspect, for 2030 unless we make significant changes to the way we do our business. That is now a feature of the work of the Joint Committee on Climate Action and I hope that over the next number of months we will be able to bring forward policy decisions to inform the Government about achieving the targets we have set out.
I thank all those involved in making this a success. I hope that it is just the beginning of a detailed commitment from those of us who are elected and have the burden of responsibility to protect the environment. I hope we will work assiduously over the coming months and years to bring forward legislation to move us away from our dependence on fossil fuels, to look at harnessing clean energy and to reconfigure the way we live our lives to provide respect for the environment in order that we hand on to future generations that which was provided to us in such a careful way.
I congratulate and commend my colleague, Deputy Pringle, his team, Trócaire and everybody in the Chamber who played a role in getting this Bill to this Stage. It is an important landmark in the Dáil. It sends out a message worldwide that we are not only laggards but we can actually do constructive work on climate change. We know climate change is having a severe impact on the most vulnerable of people in the world and today, Ireland will take the landmark step of becoming the first country to divest public money away from fossil fuels. That is quite an achievement and I am proud to be part of this debate today.
The United Nations has described the humanitarian crisis in east Africa as the worst in that region since the Second World War. Last summer, 25 million people faced starvation due to severe drought. That ended in April 2018 and was replaced by devastating floods. We know the impact that climate change is having right across the world as well as in this country. This divestment Bill is a great opportunity to put Ireland on the right path towards tackling this issue and supporting the most vulnerable people worldwide.
The people doing the least to cause climate change are suffering the most, while those with the most power to address it have, so far, utterly failed to do so. People in Africa feel let down by the damage being done by richer countries and are crying out to us for help, not only through providing aid and resources but also by changing the way we live and reducing our carbon emissions. Climate change is a global issue and requires a global response. I hope that from today, with this divestment Bill, that other countries will start taking up the issue and will bring in their own divestment Bills. Divestment will be an incredibly important moment for climate justice and many eyes in east Africa, and worldwide, will be on Ireland today to see the Fossil Fuel Divestment Bill pass through the Dáil.
This Bill is the culmination of more than two years work by Deputy Pringle, his team and Trócaire. It seeks to drop coal, oil and gas investment from the Ireland Strategic Investment Fund. It means Ireland will be leading the way by being the first country in the world to do so. The industry contributing the most to the climate crisis will now be tackled. Deputy Thomas Pringle has been like a dog with a bone but he also has been flexible enough to be able to work through the whole divestment Bill to make it possible. I say well done to him and this Bill will have a major impact here and worldwide.
I welcome the opportunity to speak on the amendment to this Bill. It is an important day and I thank Deputy Pringle, Trócaire, the Stop Climate Chaos Coalition and many of the people in the Public Gallery who we have met over recent years on this important issue. I hope this Bill will fulfil its aim, that it is strong enough and the wording is sound enough - I think it is - to ensure investment in fossil fuels by the Ireland Strategic Investment Fund ends.
The Ireland Strategic Investment Fund does not have a large exposure at present to fossil fuels but some investments, such as in Dublin Waste To Energy, are not sustainable. That will need to be looked at in future and the policy addressed.
The intention of the Bill is positive and is a clear statement by the State of the direction in which we want to move. I am glad to see that there is a level of political consensus for it here in the Chamber.
When we talk about moving away from fossil fuels and reducing emissions, we must also talk about the alternatives. There is no morality involved in simply stopping investment in fossil fuel while we continue investing large amounts of money in coal to generate electricity. Where is that fuel coming from? What type of companies is it coming from? There is a carbon footprint incurred in hauling such fuel across thousands of miles. We must also consider the conditions endured by the workers who extract that fuel in places such as Colombia. It is important that we do not congratulate ourselves for doing the right thing on our little green sod. We need to look at the overall picture.
This Bill will pass today and we will have a conversation about climate change. Everyone believes in climate change, except for one or two people from Kilgarvan and one or two in the White House. The whole conversation must be followed up with action. We should not see this as a negative thing but rather as an opportunity. The smart investment and money will now move towards new, sustainable industries that will create sustainable jobs and generate sustainable power for Ireland, and hopefully much of Europe and the world. The State must build on the diverse energy sources available to Ireland in order to keep the lights on. We need to stay on track with this. We have been negligent, as myself and others have highlighted over the last seven or eight years. This is not a burden. We need to grab the opportunity it presents. Ireland has access to many forms of energy, including hydro, bio-mass and bio-gas, on which I brought forward a policy document. Sinn Féin has brought forward a document on all-Ireland energy, which was passed at a recent Ard-Fheis. We have access to solar power, which must be used. We must also focus on offshore wind and onshore wind, as well as wave and tidal energy. Those sources of power must be developed.
There is a real issue in terms of the electrification of public transport and private motor cars. The network of charging points has to be dealt with. Currently ESB provides a very limited network of charging points and has been told by the regulator that it must divest itself of that. That matter must be addressed. We have to take this seriously and there are a number of actions we can take. Before I came to the House today I attended a meeting of the new Joint Committee on Climate Action, which will seek to sort out the nuts and bolts of getting through a large amount of work in a three month period and play catch-up. It is an absolute disgrace that we are where we are, facing a huge carbon cliff that I have warned this House about several times over the past four, five, six or seven years. I warned the EU Commissioner for Agriculture and Rural Development, Mr. Phil Hogan, about it. The cliff is now in front of us and we are not just facing fines but also shame.
The contribution we are making to climate change is clear. There have been four major weather events recently that I have never seen the like of in my lifetime. We are lobbying for this, that and the other. We have to get real and look at what is straight in front of us. The facts are that this is not helping farming, industry or anyone else. There have been two fodder crises in seven weeks, one caused by a cold spring and another at the moment because it is too hot. We have to get real about this. We have to meet our climate change targets. We are supposed to reduce our greenhouse gas emissions by 20% at a minimum by 2020. It is disgraceful that we will only hit 1%. We should be trying to exceed that 20%. We must up our game. No matter where one stands on the political spectrum, this cannot be deferred. Our children and grandchildren are going to face catastrophic problems unless we deal with this. The time for action is now. It cannot be put off until tomorrow or the day after. We cannot kick the can down the road. We have a responsibility here. It is great to see the people in the Public Gallery and that all parties are taking this on board. We have taken on other issues recently in this Chamber which seemed impossible to deal with in the past. Everything seems very hard, or impossible even, until it is done, as Nelson Mandela said. I firmly believe in that. Things seem impossible until they are done. When it is done we wonder what the fuss was about. We have to get on with dealing with this issue, make smart investments and make sure that money is put into the correct industries.
It is appropriate that I advise Members that we have allocated two hours for this debate and it will adjourn after that time. I would have thought that most of us would want the Bill to pass within the two hours. There are seven or eight more Members who wish to speak and they may speak for seven minutes each, but if they do we are unlikely to be able to pass the Bill. I am in the hands of the House.
I welcome the Bill and congratulate Deputy Pringle for his tireless work on this issue. I also thank Trócaire for its advocacy. It is an organisation that, since its foundation, has been committed to climate justice. I have witnessed the work that it does first hand in countries such as Ethiopia, where it partners with people on the ground to deliver the productive safety net programmes. It also helps to ensure sustainable food production. We have to make the link between what we are doing with this legislation and what happens in countries such as Ethiopia and others in sub-Saharan Africa. If we are serious about partnering with people in places such as Tigray in Ethiopia, we cannot be paternalistic about it by continuing to produce fossil fuels and emitting greenhouse gases, both of which are causing major consequences for the very people we are trying to help. We have closed the loop on that. We have shown real leadership and through Irish Aid we can send a very positive signal to the eight countries we are working with, particularly in sub-Saharan Africa, that Ireland is now taking the lead in terms of a process of divestment of fossil fuels.
This legislation also sends a very positive signal in terms of the Paris Agreement. We still have a long way to go to meet the targets that agreement set, as has been said, but today is a positive step forward. The Third Report and Recommendations of the Citizens' Assembly, which is subtitled, "How the State can make Ireland a leader in tackling climate change" should be mentioned. We will be grappling with that issue soon. Some of the recommendations of the Citizens' Assembly, composed of citizens of Ireland, are very radical and progressive. One of the recommendations, endorsed by 100% of the members of the assembly, is that the State should take a leadership role in addressing climate change through mitigation measures. The report lists a number of suggested measures. I look forward to this House engaging with that report. If we are radical and progressive in terms of our approach to this issue I believe we can become global leaders.
I again congratulate Deputy Pringle and Trócaire. This legislation sends a very positive signal to our partners in sub-Saharan Africa.
I will be very brief, because I definitely do not want a situation to arise where we all speak effusively in favour of the Bill and not get around to passing it. I will do my very best to avoid that situation. I congratulate Deputy Pringle, Trócaire and the other organisations which have campaigned on this issue. This is one of the most important Bills the House will pass in this Dáil term. It is testament to the power of campaigning, organisation, mobilisation and the impact those actions have on political parties inside this Dáil and on the Government. That particularly applies in the context of the minority Government we currently have. It is a green light for environmental activists to mobilise and apply pressure to ensure that other Bills, such as the Climate Emergency Bill, are treated in a similar way and are ultimately enacted.
I am glad the Government seems to have dropped its objection on the issue of gas in particular.
We had a peculiar exchange in the Dáil on Committee Stage, when the Government was trying to maintain that gas was not a fossil fuel but a transition fuel. It has now accepted that it is included.
My third point is that this is a bright light. It sends a message around the world and points the way forward for activists all around the world. In passing this bright light, we should not forget or ignore the darkness that still emanates from this country in respect of our treatment of climate change. It has been two weeks since the Climate Action Network report, which rated Ireland second last in the EU, only ahead of Poland in terms of action on climate change. It was utterly damning. This is a really important step but there are many more actions to take.
The final and key point is that the reason this Bill is so important is that as Deputy Maureen O'Sullivan pointed out, it follows the money. The reason our planet is being destroyed is the interests of big oil. One hundred companies are responsible for 70% of the emissions since 1988, while 25 companies are responsible for 50% of the emissions since 1988. That includes companies like Chevron, BP, Exxon Mobil, Shell and other oil and gas corporations. Their thirst for profit, which is utterly unquenchable, is a driving factor in the destruction of our planet. Tackling this issue in this way, by putting forward and enacting the idea of divestment, is absolutely essential. Radical solutions are needed to halt the runaway train of climate change. That means tackling the interests of these profiteers, going away from a society where their interests and profits come first and where they therefore stand in the way of a rapid and just transition to a low-carbon economy. Those interests stand in the way of a transition to reliance on public transport. They stand in the way of energy transition. This is a very powerful Bill that points in that direction.
I also thank Deputy Pringle for his fantastic work in producing this Bill and persisting with it to the point that it is going to be passed. I also wish to thank Trócaire, the Stop Climate Chaos Coalition and all those who have championed and supported this Bill. It is hugely important. As others have said, while the impact is modest at one level, it is an absolutely clear signal that we have to move rapidly to a fossil-free future. The public investment in that area must be concentrated in areas that do not further damage our environment or threaten the future of this planet. It should be invested in areas that will help reverse climate change and stabilise our climate and our environment. It is a fantastically positive moment that we are about to pass this into law. It is part of a sea change that is happening, and that sea change is because of the campaigning work of huge and growing numbers of environmental campaigners. They include young people and others who are determined to push this issue to the top of the agenda where it belongs, and force the political system to respond and address the issue of climate chaos and climate change.
I want to add one particular point in addition. I do not want to go over ground that has already been covered by Deputies Bríd Smith and Paul Murphy, although I should say that I endorse the call for this to be complementary to things like Deputy Bríd Smith's Petroleum and Other Minerals Development (Amendment) (Climate Emergency Measures) Bill 2018. We need to move that legislation rapidly through as well. I hope we can do that early in the autumn and that there will be no attempt to block it. If we are serious about dealing with climate change and avoiding the climate cliff, the fines etc., we must clearly indicate that there is no justification whatsoever for extracting further fossil fuels in this country, or indeed anywhere else.
There is one particular point I want to underline. If we are going to move away from investment in fossil fuels, we must also dramatically increase investment in areas that will help reverse climate change and move us towards a sustainable future as far as climate and the environment are concerned. My particular hobby horse in this regard is the issue of forestry. As we move away from State investment in fossil fuels, I would really like to see not just Ireland Strategic Investment Fund, ISIF, money, but National Treasury Management Agency, NTMA, money and public investment directed into forestry. Deforestation is responsible for 15 to 20% of all carbon dioxide emissions in the environment.
I think it is totally relevant, in fairness, a Cheann Comhairle. Where do we invest ISIF money if we do not invest it in fossil fuels? We want to invest ISIF money, NTMA money and public money in things that will help to deal with climate change, because this is about dealing with climate change. I am simply pointing out that one way we could do that is by investing in forestry. It is uncomplicated and it is win-win-win from the points of view of the economy, the environment and employment. It is a tragic fact that Ireland has the best conditions for forestry in Europe bar none and has the lowest level of forest cover in Europe bar none. That is a desperate failure, and we need to do something about it. Much lipservice has been paid to this and we are not progressing. In the same way, we have not really progressed in dealing with climate change and we are facing big fines as a result. We are the laggards, as the Taoiseach has said. In the same way, we are real laggards in this area, which could be so beneficial. As the NTMA and the ISIF are obliged to rethink their investment portfolio to move away from things that damage the environment, as this Bill proposes, I really hope they begin to think about areas like that, where investment would be environmentally beneficial.
Tá a fhios agam go bhfuil an Ceann Comhairle faoi bhrú agus go bhfuil sé tuirseach ach tá an t-ábhar seo thar a bheith tábhachtach. Tá gá le mionscrúdú a dhéanamh air agus tá gá le chuile dheis a thapú chun cur in iúl chomh tábhachtach agus atá sé. Ní bhíonn mórán deiseanna againn. Is é seo an dúshlán is mó dúinn sa Dáil seo. Má theipeann orainn céimeanna a thabhairt maidir le hathrú aeráide tá an cath caillte.
Tuigim é sin ach tá am againn.
Climate change is happening without a doubt, despite some deniers in this Chamber who believe it is not. I think we can no longer ignore the fact that not only is it happening, but people are suffering. My country, and other countries that are causing this and have the biggest footprint, are not suffering like others are suffering. We have to take every opportunity to say that and put it on the record. In my opinion, this is the last Dáil that has the change to tackle climate change before it is too late.
This Bill signals genuine global leadership in tackling climate change. I thank Deputy Pringle, the Department and the other parties for co-operating in this regard. It represents a unique opportunity to ethically invest public money and to send out a strong message about Ireland's intention to meet its international obligations, a point to which I will return. We are miserably failing to meet our legal obligations. I have just stepped out of the Committee of Public Accounts. The NTMA is before the committee today. Under that agency's remit comes the ISIF and NTMA representatives have just confirmed that since their last appearance before the Committee of Public Accounts, it has divested itself of investments in 16 entities. That is a very positive development. The NTMA has done that since its last appearance before the Committee of Public Accounts because of this initiative by Deputy Pringle and the Department. I welcome that.
We know about the Paris Agreement, to which Ireland eventually signed up on 22 April 2016. It is the first universal, legally-binding global climate deal. It is a global action plan to restrict the impact of carbon emissions on global warming. As we all know, the aim is to hold the increase in the global average temperature to below 2° Celsius above pre-industrial levels and to limit the temperature increase to 1.5° Celsius. Before signing the agreement, we passed the Climate Action and Low Carbon Development Act and we passed the mitigation plan afterwards. However, we are failing absolutely to comply with our very basic obligations. Our commitment, as part of the collective EU pledge, is to reduce greenhouse gas emissions in the short term - that is, by 2020 - by 20% below the 2005 level. The medium-term target is to reduce emissions by 30% of the 2005 level by 2030 and the long-term target is to reduce them by 80% to 95% by 2050. Ireland will be one of only two countries to miss out on the short-term 2020 targets. It is pretty clear that we will not meet the mid-term targets either. According to the Climate Change Advisory Council, which is a good body - that it was established was a positive step but we are simply ignoring it - current climate policy means that Ireland will miss its agreed 2020 emissions reduction target by a substantial margin without a major new policy and measures. The council has indicated that we will also miss out on the 2030 EU target and the 2050 target by very large margins. This is the language of the Climate Change Advisory Council, it is not mine. In addition, last month the EPA projected that Ireland's emissions will decrease by just 1% by 2020 and has called for a decisive move away from fossil fuels. This is certainly a step in that direction. In addition, Ireland is the third highest carbon emitter in the EU. Ireland came second lowest - just ahead of Poland - in recent rankings on where EU countries stand.
My time is limited but there are things which must be highlighted. The Climate Action Network has pointed out that we have failed to join the group of progressive EU member states calling for increased EU climate ambition. It has also pointed out that we face €500 million in fines. There has been a dispute about whether it is €500 million or €400 million rather than about why we are failing to meet our targets. As the UN report notes, the other cost is that the global average cost of climatic disasters - including floods, storms, droughts and heatwaves - is estimated to have risen substantially from $65 billion in the period 1985 to 1994 to $154 billion in the period 2005 to 2014, an increase of 40%.
It is interesting that the Department of Finance is sponsoring this legislation and not the Department of Communications, Climate Action and Environment. It is also interesting that the Citizens' Assembly set and came up with very practical suggestions. I have to put on the record the fact that I was one of those who was very sceptical when the Citizens' Assembly was set up. I have to say that I was wrong. It has done Trojan work. The challenge now is to implement the assembly's recommendations, which, of course, we are not doing. We have set up another committee and we were going to hear all over again what the Citizens' Assembly stated. We simply do not have time to do so. I thank Deputy Pringle for bringing forward the Bill.
In some ways, this is like being present at a backslappers' convention but it probably highlights the fact that this is an unusual day for the House. It is appropriate that it is the final day of the Dáil term and it is interesting that the time in which we are speaking is time the Government gave and swapped with Independents 4 Change in order that we could conclude the debate on the Bill. That is a good sign. It is not often that we get the opportunity to acknowledge positive developments in this House. There are not too many of them. We need to give credit where it is due. In that context, credit for this Bill overwhelmingly lies with Deputy Pringle and the staff in his office, particularly Jodie, as well as Trócaire and the other organisations.
When we say Trócaire, we do not just mean an organisation, we mean all of the hundreds of citizens who have been mailing all of us over the course of the past week to encourage this Bill over the line. That encouragement has been good and we have an obligation to those to whom I refer see the Bill through with the level of urgency they demanded of us. The legislation is largely symbolic, but symbolism is incredibly important. We have made a stand today, historically and on the world stage, and it is now a case of us being obliged to follow it up. It is also a reality check. If we continue to show the apathy that has been shown in this State, we will sleepwalk into an environmental disaster and we will be left to wonder, 20 years from now, why we did not act when it was in our power to do so.
When we refer to the fines that Ireland will inevitably have to pay because we are so far behind in terms of our carbon emissions targets, it is sadly ironic that the fines are actually the least part of our troubles. As Deputy Connolly stated, Ireland currently has the third highest rate of emissions per capitain the world, with a very heavy reliance on oil, coal and peat. In addition, emissions in the key areas of agriculture, energy and transport are increasing. We are aware that the Climate Change Advisory Council has been highly critical of our progress to date, that Trócaire made recommendations a number of years ago and that it has taken a number of years to get to this symbolic Bill. How many more years is it going to take to deal with the other fundamentals if we do not start delivering on them?
The Government sent certain mixed messages this week by opposing Deputy Bríd Smith's Bill, which was being scrutinised by the relevant committee this week. There is an urgency here in that we have to alter our thinking. Perhaps we can repeat the co-operation that has taken place on the Bill before us and bring it to bear on all of the other measures that are desperately needed in order to address the State's inaction in respect of the key issues relating to climate change.
I thank everybody involved in bringing forward the Bill. Like previous speakers, I am of the view that it must be seen as part of a wider suite of measures which are necessary and which must be taken seriously in the coming months and years.
In order to accommodate other speakers and the passage of the Bill, I will be brief. My party's position has been well put by Deputies Michael McGrath, Lawless and Dooley. I was anxious to have a few minutes in which to contribute because I have received hundreds of emails from concerned young - and not so young - people in my constituency about climate change and what it is doing. It is past time for us to be doing what we are doing today. Like other speakers, I applaud the many people who have fought this campaign and I compliment Deputy Pringle on what he has done. As Fianna Fáil spokesperson on the OPW and flood relief, I the Inishowen Peninsula in the Deputy's county of Donegal. What I saw was bizarre and unbelievable in terms of the damage caused. Some of that damage has yet to be rectified because not all of the repairs have been completed. What I saw was frightening and horrendous. My county, Roscommon, and parts of Galway, Offaly, Longford, Clare and other counties have been badly hit by severe flooding. If we do not take action on climate change, the cost to the nation in human terms will continue to grow. Lives have been lost, property has been destroyed and businesses that closed due to flash floods have not reopened.
As the representatives of the people, we have to be brave, take steps such as those outlined in the Bill and deal with the issues being brought to our attention by people in Trócaire and others who support them. In the past, my party took brave decisions. We were not afraid to introduce the levy on plastic bags. We were not afraid to introduce the smoking ban. This is why we are here in total support of what Deputy Pringle is doing. We will have a further opportunity to speak on this. It is a great day and I am delighted to support the Bill. Fianna Fáil will work with Deputy Pringle to ensure that greater progress can be made. It is absolutely essential that we move very quickly on all of this.
It is absolutely right and proper that Ireland should pursue an ethical investment programme in respect of State investments held on behalf of the people of Ireland.
Any time people have been consulted, including at the Citizens' Assembly, they have indicated clearly that they want an ethical investment programme. I thank Deputy Pringle for bringing forward his legislation and Trócaire, as well as all the people working for it, for supporting the Bill and contacting our offices. We have done this before, of course. As a country we do not invest in guns or military equipment. As has been mentioned, we divested from investments relating to cigarettes and other products that could cause harm to people around the world.
With regard to the harm done to people around the world, there can be no doubt that climate change has done great harm to tens of millions of people in vast areas, particularly in Africa and Asia. Today an exhibition will be launched by Uachtarán na hÉireann in Kilmainham Gaol celebrating the 100th anniversary of Nelson Mandela's birth. When Mr. Mandela got out of jail, something he said continuously to young people in supporting education in particular concerned how we treat our planet and hold it in trust. He indicated we do this not for ourselves but for future generations. It is important to signal today that we favour decarbonisation of the economy in our own and other interests. We know about the water shortages we are currently experiencing.
I worked on many occasions alongside Trócaire in Africa in the 1980s when I was with the Irish development programme in Tanzania for three years. Climate change was beginning to become evident then and significant parts of the east and west Tanzania were becoming desertified and losing tree cover because of what was happening with the planet's climate. I went back to Tanzania last year and it broke my heart to see how much climate change had impact negatively on this vast country in east Africa. Climate change has a particular impact on women and children there. In Africa, women their children in rural areas must fetch water and bring it home. They must also procure fuel by cutting trees and making charcoal. By and large, it is the only way to get fuel for cooking, particularly among poor families. Again, Trócaire is one of the organisations that has done much work worldwide trying to improve the lot of poor women and families in Africa and make their lives a little easier.
The burden of climate change falls on the poorest families and people in Africa. Along with our development aid programme, as a country we should ensure the policies we pursue with institutions like the NTMA are entirely consistent with what people in Ireland would like to see happening for the betterment of families and individual women, children and men in Africa.
Ironically, today is also when US President Trump, that great climate change denier, visits our neighbours in the UK. He is a disruptive force with respect to climate change as he basically argues that it is not happening. I hope during his presidency he will get the opportunity to visit some of the different areas in Africa where livelihoods are being devastated by the impact of climate change. I am pleased that currently institutions such as the World Bank and its president, Dr. Jim Yong Kim, are positively pursuing solutions to climate change and education so that people can adapt their own countries as to how best to deal with this enormous difficulty, which has an impact on water and forestry. There are many species in Ireland suffering the impact of climate change. This problem also has an enormous effect on household costs, particularly in Africa, where women are responsible for water, fuel and the land.
I congratulate Deputy Pringle again on the Bill, which we support. Former President, Mary Robinson, has worked with people like Nelson Mandela, when he was alive, to try to change the world view on this. Just as with the industrial revolution there was a shift and, along with revolutions involving information technology and social media, there will be another shift if we can get enough people with goodwill to come together and agree that we should conserve water and our planet, and deal with climate change. If that happens, we will bequeath a better world to the young people of today.
I welcome the opportunity to contribute to the debate. I do not have a problem with governments not investing in fossil fuels in future but there are few issues of which we should be mindful. According to reports, it seems that the rate of coal consumption last year was one of the highest ever, so despite what we are trying to do in this country, other countries do not seem to be adhering to such standards. Germany is constantly opening lignite mines and Vietnam is opening a coal mine every week. If we do something, other countries must do it as well.
Bord na Móna will move away from peat after 2030. I met the company's representatives in the audiovisual room a few weeks ago when they gave a presentation and, unfortunately, 1,100 or 1,200 workers will be affected. We must ensure they are protected, as the only plan I could see was that they would be pensioned off bit by bit. When the hard questions were put to those representatives about where people would work or how families in the midlands would be affected, no answers were forthcoming. Government plans must take in electricity generation in Lanesborough and Shannonbridge, which may go to biomass, but we must be sure of those solutions. We cannot just knock off a tap overnight.
I listened with interest to the comments about where the country is going. I am not sure we ever had a plan. I have heard people saying we can have trees but they do not grow overnight. Unfortunately, growing willow on bogs has not been successful; it is such a bad crop that we would need the whole of County Roscommon to feed Lanesborough, and that will not happen. We must be realistic. People give out about farmers in Ireland but they are efficient. We are the most efficient producers of beef in Europe and Europe is a more efficient producer than the rest of the world because of concentrates used elsewhere. We must be mindful of that.
Another aspect that we need to perfect is solar power. I know things have moved on and have got better, but we need to own up to another thing. Government aid for peat will finish next year. I have never been madly in favour of subsidising anything because I believe in the real world we have to produce products without too many subsidies. We are subsidising wind. Wind power needs to start standing on its own, as does solar power and all the rest. Otherwise the price of electricity will go up.
We are a manufacturing and exporting country. Let us consider the west of Ireland and companies like McHale that is sending machinery throughout the world. It is a great company that started from a small shed. It cannot afford rising costs. We are competing with countries that have nuclear and other types of electricity. We have discussed interconnectors and so on but we need to be mindful that the price of electricity has to be affordable for householders and businesses.
We need to consider the farming community. People refer to the national herd and so on. If we are honest about it, a total of 300,000 people are involved, as many as are employed in multinationals in this country. We have to protect that side of rural Ireland. We cannot simply turn off the key. People cannot live on fresh air, although some people might think that is possible.
We need to consider where there are alternatives. People referred to the incinerator in Dublin, to which there were many objections. Where people live in large built-up areas they have to take the brunt of that as well. We cannot simply say the west of Ireland will produce every tree and will have every wind turbine and solar farm. We cannot simply say that everyone else can do whatever they want but they will not have to put up with any problems. No one is saying they will not take their share of these new systems, but there should be an even distribution throughout the country.
While I have no problem with the Bill or with Deputy Pringle, we need to be mindful of what other countries are doing and of how to save jobs. Bord na Móna is one company that comes to mind for 2030. We cannot wish everyone good luck in 2029. Housing estates were built by Bord na Móna down through the years. While people might not like all of this, the reality is that those small economies, for example, the butcher shop and the local grocer in the area, lived off an economy built around that. We need to ensure that Government investment down the road is appropriate.
I hear the view that we will be harvesting trees and that we will have woodchip and so on. That will not happen in seven or eight years. We need to be realistic about it. We need to plan for the future if we are going in different ways.
The Government should lead by example. Let us consider the likes of Galway. There are no plans for electrification in through the city. What about the likes of the train system and Dublin Bus? Whether we like it, for every ten buses we buy today that are diesel-powered, we will be buying eight if they are electric and diesel combined. We will need more money in the kitty for all of this. That is the debate that needs to take place; we need to know where we are going.
The amendment effectively replaces the full text of the original Bill, as presented by Deputy Pringle. It is based on an amendment that Deputy Pringle initially proposed on Committee Stage. It has now been agreed after extensive engagement between Deputy Pringle's office, NGOs, Ireland Strategic Investment Fund and the Department of Finance such that it sets challenging but achievable targets.
If Deputy Pringle's amendment is accepted, as I hope it will be, it will insert a new provision in Part 6 of the National Treasury Management Agency (Amendment) Act 2014. This is the part of the 2014 Act that established Ireland Strategic Investment Fund and sets out its statutory remit and investment mandate. The new section will change the ISIF mandate for the future. The changes are designed to restrict ISIF making fossil fuel investments while taking appropriate account of the national transition objective.
The amendment defines what constitutes a fossil fuel undertaking. It is an undertaking for which exploration for extraction or extraction or refinement of fossil fuels accounts for at least 20% of its turnover. The National Treasury Management Agency, as custodian of ISIF, would be obliged to endeavour not to directly invest in fossil fuel undertaking.
Where ISIF is directly invested in a fossil fuel undertaking, the NTMA will be obliged to divest from it as soon as is practicable. This statutory obligation is strong but it allows a small margin of flexibility to take account of the need to comply with applicable contract terms and the importance of preserving fund value for the State.
The provision provides a 15% tolerance threshold for indirect investments. ISIF must ensure it does not maintain investments in an indirect investment that is likely to hold more than 50% of its assets in a fossil fuel undertaking. I wish to emphasise that this is an upper band against which ISIF can be audited. This will mean ISIF will have a strong incentive to keep the fund's exposure substantially lower to take account of sectoral volatility. In addition, provision is made that the Minister may by order prescribe a lower exposure to fossil fuel undertakings in indirect investments.
The proposed section 49A(4) is particularly important. It provides an exemption from the general rules set out for investments and indirect investments. This is to allow ISIF to make certain investments consistent with the State's national transition and climate change objectives. Where an investment is made in a fossil fuel undertaking using that flexibility, ISIF must specify that fact when it publishes the fact that it has made the investment. ISIF will be obliged to report on the measures it takes by way of divestment or otherwise to comply with these measures.
I strongly support this targeted and considered and practical amendment. It will balance the challenges of reducing exposure of fossil fuel investment while enabling ISIF to earn investment returns for the Irish taxpayer and, most important, support through its investments projects designed to assist in the national transition objective. I commend Deputy Pringle on his work in advancing this Bill and I commend the amendment to the House.
I wish to touch upon some other matters briefly. They relate to the work between Deputy Pringle's office, non-Government agencies and organisations, including Trócaire, ISIF and the Department of Finance. We had a really good strong robust debate on Committee Stage. If anything, that really helped to focus minds. Everyone wanted to achieve the objective. The question was how we got there. I commend Deputy Pringle on his flexibility in allowing ISIF and the Department of Finance to have that level of flexibility. Without that, I am unsure whether we would be where we are today.
I want to touch on some other items quickly, including the 2040 Rebuilding Ireland plan. The largest level of expenditure between now and 2040 will be in sustainable projects and sustainability with regard to how to de-carbonise Irish society. This is something to which I am personally committed on the financial services side of my brief. I believe this is where most investment will occur in future.
I have used a particular figure in the past. To decarbonise Europe per annum, the shortfall is €160 billion. Valdis Dombrovskis, Vice-President of the European Commission, attended the European Financial Forum and quoted a figure of €180 billion. That is how much we are short in Europe every year and that is not taking into account the billions of euro currently being invested to decarbonise Europe. We are trillions of euro short worldwide when it comes to decarbonising to protect the planet.
In terms of financial services, my objective is to make Ireland the global hub for sustainable green financial services, green bonds and products that can be sold around the world. If we can do that here in Ireland - and throughout the country, not just in Dublin where most people talk about basing financial services - it will have a huge benefit. Not only will we administer them from here but we will also spend them here.
I am concerned about something that is happening now, which I see in my own county, whereby people are objecting to everything. It is everywhere. Wind farms are objected to. We brought in new controls to keep turbines back from property boundaries, which is appropriate. There are objections to solar farms. People are creating fear and doubt and saying the craziest things about renewable energies that are clean and tested and have been for decades. It has to stop or we will never meet these targets.
Events like what happened with the Apple data centre in Athenry cannot continue. People who object to a project because it is close to them are wrong in so doing.
I will take this opportunity to thank all the Members for their support and comments. I also thank the Ceann Comhairle for handling the debate and ensuring that we finished in time, as without his stewardship we could have talked ourselves out of it and ended up without passing the Bill.
It is welcome when there is cross-party support for an initiative such as this. It is a moment to be celebrated by civil society and the members of the public who have got behind this Bill and pushed hard and consistently over the last two years on this issue. For the global divestment movement that has been shining an essential light on the contradictions of investing in the prolonged expansion of an industry whose business plans are in direct contradiction of the hard-won goals set out in the Paris Agreement, our last chance of avoiding catastrophic climate change, it is also a moment to be celebrated.
If passed through the Seanad, this Bill will make Ireland the first country to commit to divest from the global fossil fuel industry. However, I feel strongly that this is not a moment for celebration in the Dáil. Rather, it is a moment to stop and seriously consider the role we are playing in the global effort on climate change. With this Bill, we are leading the way on state-level divestment from fossil fuels but we are lagging seriously behind our most basic national, EU and global level commitments.
While the cross-party support for this Bill shows that significant change is possible where there is political will, thus far we have not the political will to take the big and small decisions that are needed to unlock the change. That must change.
In closing, I want to step back and recall how this Bill came to be. About two years ago, Trócaire approached me and shared their deep concerns about the direction climate change was taking globally and particularly in Ireland. The impacts of climate change today are already at crisis levels, a human tragedy unfolding against a background of continued political inertia. We must be very clear; people are dying today as a direct result of climate change through the increasingly frequent and intense disasters, through increased hunger, increased water scarcity and significantly more will die or be forced into displacement if there is not a radical change in direction.
Let this be a moment where we commit to getting serious. Let us show the Irish public and the international community that we are ready to think and act beyond narrow short-term and vested interests and will take the opportunities that lie ahead of us to bring in real change.
Finally I wish to thank a number of people who made all this possible. From Trócaire, Cliona Sharkey, Selina Donnelly, Niamh Garvey and their entire team have worked incredibly hard and gave much of their time and expertise to see this project to completion. I thank them and any others I may have left out. I thank Stop Climate Chaos for organising the divestment campaign and for the coalition's activism - all the emails and advocacy - which have kept the issue on the agenda. I thank all the university students across Ireland, and especially in NUI Galway and Trinity College Dublin, who helped campaign for divestment and activated ordinary citizens on the ground to rally behind this. I thank Gerry Liston of Global Legal Action Network, GLAN, whose expertise in legislative drafting made this project possible. John Moreland from the UK assisted us with some of the more financial and technical aspects of the Bill, for which I thank him. I thank the Minister and all the staff for their support and work on this Bill.
I thank all the Deputies from Independents4Change and other political parties who have supported me. Lastly, and most importantly, I thank Jodie Neary, my parliamentary assistant, who has done most of the work on this. I just stand here and make the speeches, which is the nice handy part of it, but Jodie has done all the hard work so I thank her for that and everyone for their support.
I join in tributes to everyone who has been involved in this initiative. It is groundbreaking legislation. I pay particular tribute to Deputy Pringle. He has had much praise deservedly heaped upon him, to the point usually only heard for deceased Members. Well done.