Darren O'Rourke (Meath East, Sinn Fein)
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88. To ask the Minister for Communications, Climate Action and Environment about the ongoing high cost of energy in Ireland, his plans to identify underlying factors for this; his further plans to address them; and if he will make a statement on the matter. [3487/24]

Darren O'Rourke (Meath East, Sinn Fein)
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I am asking the Minister about the ongoing high cost of energy in Ireland, his plans to identify underlying factors for this and his further plans to address these costs. Will he make a statement on the matter?

Eamon Ryan (Dublin Bay South, Green Party)
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The energy security package grounds Ireland's energy policy on three policy objectives: sustainability, affordability, and security. Action 2 of the package commits to standardising the approach used to evaluate the affordability of new and existing policy initiatives for consumers. My Department is committed to ensuring policies that have an impact on consumers are evidence-based, with costs minimised as far as possible, and assessed according to these policy objectives.

The core driver of higher energy bills for Irish households and businesses is high wholesale energy prices. Ireland is a price-taker on international fossil fuel energy markets and the rise in wholesale gas prices since the Russian invasion of Ukraine, and the connection between gas and electricity prices, has had a serious impact on household energy costs. Due to consistently high gas storage levels and the efforts to reduce demand across Europe, wholesale gas prices fell substantially throughout last year and are currently well below the peak values of August 2022. While energy prices remain above their pre-pandemic levels, consumers are starting to experience reductions in gas and electricity prices. This is a welcome development and I expect all suppliers to continue to pass through savings to consumers as quickly as possible.

In June 2023, I wrote to the Commission for Regulation of Utilities to investigate pricing strategies within retail energy markets, and to report on whether market failure has occurred. Its report found no evidence of market failures, and it will continue to monitor this into the future. Throughout the period of high energy prices, the Government has continued to support energy consumers to stay warm and well. Most recently, budget 2024 introduced a total €2.2 billion suite of once-off cost-of-living measures to assist families, pensioners, carers and people with disabilities. This included a new electricity cost emergency benefit scheme through which €412.83, exclusive of VAT, is being credited to each domestic electricity account in three payments of €137.61, again exclusive of VAT, between December 2023 and April this year.

Darren O'Rourke (Meath East, Sinn Fein)
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There is no doubt that workers and families are really struggling with their energy costs. We can see that as presented in the numbers in arrears, those contacting St. Vincent de Paul, for example, and others struggling with energy bills. Almost one in four domestic gas customers are in arrears at this stage. Therefore, there are real challenges there. However, my question specifically asks about the underlying factors driving the high cost of energy in this country. The Minister stated that the CRU said there was no market failure. Is it the case that customers in Ireland are expected to live with energy bills double the European average into the future or will the Government act to tackle the underlying causes of those huge bills?

Eamon Ryan (Dublin Bay South, Green Party)
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There are two key reasons for those high bills, the first of which is the very distributed nature of our population, which makes it very expensive to provide the grid and other infrastructure to service every house. The other key fundamental is that we are still generating some half of our electricity from the use of gas. Those countries which have a high gas component in their electricity mix are seeing the highest prices. That will change. We are absolutely committed to deliver on the switch to renewables, rather than relying on fossil fuels, to meet 80% of our energy needs by the end of this decade. I am absolutely convinced we can do that. We have been restricted in the last three years by the effect of problems bottlenecking our planning system. This is partly due to the nature of our planning laws not being fit for purpose, which is why it is important we pass the new planning reform legislation we have before the Oireachtas committee in the next two weeks. For various other reasons, An Bord Pleanála was not able to able to make decisions on some key projects. Those decisions are starting to come through now. We are seeing onshore wind farms starting to be delivered. Last year, we delivered 1 GW of solar energy in one year, which is phenomenal. If anybody had said three years ago that we would be rolling out 1 GW of solar a year, they would have been laughed at but it is now happening. That mechanism of switching to renewables is the best way for us to reduce the exposure of the Irish consumer to high fossil fuel prices.

Darren O'Rourke (Meath East, Sinn Fein)
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We are getting into some of the key issues there. The Minister mentioned the distributed nature of the population, and we hear that regularly, but there are many distributed populations across the European Union and far geographically bigger countries than Ireland that pay half the price we do for electricity and energy. Therefore, where is the evidence base to that point? On planning and the grid, the sector itself says we are further away from our renewables targets than we were this time last year because of delays in planning and in the grid. There is a massive urgency but we do not see it. We all know the approach to planning reform. It will be difficult and there is lots of concern in this regard. How can we have confidence that this dependence on gas will be addressed any time soon under this Government?

Eamon Ryan (Dublin Bay South, Green Party)
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We have one of the most distributed housing settlement patterns in Europe. There is no other country that has a similar pattern of one-off housing. It is expensive. The wires have to be brought to every house and that is by definition expensive. This is not going to change, but it is a reality. It is one of the reasons for high costs not just in electricity but also in water supply and other areas. It makes the infrastructure we have to provide for houses more expensive. That is to a certain extent something that will not change quickly because it is a pattern that has been set over several decades. On the other hand, we are changing quickly now. We will deliver the 80%. The big development will be the offshore floating project. It has to get through planning and construction, which is still complicated, but I am confident it will happen. In the interim, we need onshore wind and solar and as I said, that is changing. I met the head of the Irish Wind Energy Association recently and he said there has been a real turnaround even in the last few months. We are starting to see projects get approval. They will be built and will switch us from dependence on gas. That is the best way for us to give greater security, reduce emissions and lower prices.