Pa Daly (Kerry, Sinn Fein)
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74. To ask the Minister for Communications, Climate Action and Environment the funding model for supporting the roll-out of renewable energy and for supporting the grid; if he has plans to reform current models; and if he will make a statement on the matter. [6768/25]

Pa Daly (Kerry, Sinn Fein)
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I want to ask the Minister about the funding model for supporting the roll-out of renewable energy, the public service obligation, PSO, levy and the carbon tax, and whether the Minister has any plan to reform current models. Will he make a statement on this? We have great renewable potential. A group of parliamentarians from Germany were here last year and all they wanted to talk about was our renewables potential. What funding models are there?

Darragh O'Brien (Dublin Fingal East, Fianna Fail)
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I thank Deputy Daly. Specifically with regard to the roll-out of renewable energy onto the grid, it is an absolute priority for the Government. We have very exacting targets. We also have a climate action plan. We are making progress on renewables. We have further renewable resources we can tap into. We have offshore renewables but I believe we have more capacity for onshore renewables. We have been successful, particularly with regard to onshore renewables.

The PSO levy charged to all electricity final customers in Ireland is a vital policy support for the development of the renewable energy sector in Ireland. It will help to enable us to reach our national and EU energy and climate targets. The PSO funds a number of Government schemes for renewable energy generation. Just over 4,000 MW of the approximately 7,000 MW of renewable generation in Ireland is supported by the PSO, which is significant. The annual renewable electricity support scheme, RESS, auction programme, which guarantees funding through the PSO, is a critical enabler of the investment needed to underpin the renewables-led energy system. Any consideration of future funding models will need to deliver reductions in electricity bills for households and businesses and ensure there continues to be a stable and sustainable investment framework so Ireland reaps the long-term benefits of its indigenous renewable resources.

Regarding the funding of the electricity grid, the Commission for Regulation of Utilities, CRU, is responsible for the regulation of ESB Networks and EirGrid, the electricity system operators. Expenditure by EirGrid and ESB Networks is agreed with CRU in five-year cycles. As Deputy Daly knows, these are referred to as the price reviews. Work has commenced on the latest price review 6, which will see CRU sanction investment in the grid between 2026 and 2030. It has seen ESB Networks request a baseline investment of €10.1 billion, with the potential to grow to €13.4 billion.

Pa Daly (Kerry, Sinn Fein)
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I appreciate what the Minister has said. It is obvious that the PSO is a vital policy support, as the Minister has said. We have great potential to transform our energy system from import dependence to becoming a global leader in renewables. Significant investment will be required. At present, there is an inequity at the heart of climate change where the causes and effects are not equally shared. Recent Governments have preferred an inequitable model, where there is a disproportionate burden on ordinary households and the wealthiest get off practically scot-free.

The indiscriminate carbon taxes place a disproportionate burden on those for whom alternatives are unaffordable or unattainable and they fail to deter the greatest emissions. However, the current Government, including the junior Minister, Deputy Michael Healy-Rae, and Government-supporting Deputy Danny Healy-Rae, have agreed to continue to support these increases over the next five years.

The public service obligation, PSO, is another regressive financing lever which hits the lowest income hardest. According to the Economic and Social Research Institute, ESRI, the cost of this levy is 12 times larger. In the programme for Government, the Government said it will explore other funding models that will reduce electricity bills for households and businesses. Will the Minister commit to some other funding models that will do that?

Darragh O'Brien (Dublin Fingal East, Fianna Fail)
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All of us understand and accept that we have vast future potential to harness additional renewables that will deliver price savings and stability in our energy market, which we need unquestionably, and help us to reach the exacting targets we have set with regard to climate. We saw very recently in some areas of the country how fragile our grid is to withstand very severe weather events. That is something we take very seriously as well. As the Deputy rightly said, we have committed in the programme for Government to intensify the transition to lower-cost renewables and electricity generation and continue the transition away from expensive and volatile imported fossil fuels. We will look at other potential funding models as well. We committed to doing that too. However, I have stated how central the PSO levy is to energy generation, particularly around investment in renewables. It is critically important and I would see that remaining a very critical part into the future.

Pa Daly (Kerry, Sinn Fein)
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The question is about what other funding models the Minister has in mind. There is a broader issue of the increased investment in public ownership as a means of funding and accelerating the transition. Recent governments have created an energy system where profit maximisation seems to be the most important part of it. With the privatisation of our energy generation, the market share transfer from public to private sector means that profits have flown into corporate dividends. Is the Minister happy with that model, which has resulted in increased bills for ordinary people? The transition presents an opportunity now for us to reform our energy system for the betterment of all, but it seems that opportunity is being squandered. As the Minister mentioned, the vast majority of renewable energy under the renewable energy support scheme, RESS, is privately owned or publicly owned by other states. It is crazy to think that Norway's state-owned Statkraft and EDF France own more of our offshore resources than we do. Even more of our renewable resources are owned by private corporations. We feel that there should be increased public ownership. What measures is the Government taking to increase public ownership, if any? Furthermore, what will it do to reduce our energy prices, which are some of the highest in Europe?

Darragh O'Brien (Dublin Fingal East, Fianna Fail)
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Fundamentally, as the Deputy will know, the grid itself is owned by the State. We operate an all-island electricity market. The State owns the grid itself both North and South. The further expansion of that to harness offshore renewables in particular, as the Deputy knows, are the RESS auctions. We have five applications in planning right now. They are a very important part of actually expanding our renewables. There are other funding methods available. The Deputy will be aware of the corporate power purchasing agreements, CPPAs. They are critical enablers of the investment needed to underpin the renewables. The big focus over the coming years, now and this year and beyond, is actually strengthening the grid onshore and expanding it offshore. That has to be done. EirGrid will have a very significant plan for future investment and has been undertaking that. However, price review, PR, 6 is going to be critically important with between €10 billion and €13 billion of investment between 2026 and 2030. That is up from approximately €5 billion in the previous five years. That is critical to ensuring that we move towards a stable energy environment and can actually expand our electricity output to allow us to grow further.