James Bannon (Fine Gael)

I welcome the Minister of State to the House. I also welcome the opportunity to speak on this important Bill. Since the Second Stage debate on it in the other House last June, much has changed on the energy, environmental and agricultural fronts in regard to alternative energy. My party has made considerable strides to fill the gap left by Government's inaction on this issue.

This Bill allows us the chance to discuss the issue with which it is supposed to deal, namely, the availability of vital fuel supplies in a rapidly changing world. Our perspective today is dramatically different from even six months ago when this Bill was first debated, and it was recognised that alternative sources of energy to oil must be utilised.

If our economy continues to grow at its current rate, and it is to be hoped it will, demand for oil and various forms of energy will see a similar growth. It is up to us to ensure we opt for renewable energy alternatives in every case possible, which would dramatically reduce the impact in terms of the importation of fuels into this economy with the related economic and environmental cost. As an island, we are in a catch-22 situation. We import oil but need it to fuel the transportation necessary to bring in this essential fuel. Imports cannot be brought in underground and require transport by air or sea, increasing carbon emissions in the pursuit of more emission causing fuels.

Alarm bells are ringing loudly concerning climate change here and elsewhere in the world. Friends of the Earth and other groups spoke on this issue, which was hotly debated, at a meeting of a joint committee today. The Government has been persuaded to give up its passive stance on this issue and is responding, if somewhat belatedly, to the fact that we have one of the highest levels of greenhouse emissions per head of population in the world, exceeded only by the US and Luxembourg.

The European Commission's plan to force car makers to cut the amount of carbon dioxide produced by their cars to an average figure of 130 g per km by 2012 is welcome, but this 19% cut, however, is only a step and must be augmented in Ireland by Fine Gael's plan to charge heavy polluting vehicles a higher rate of VRT, a proposal Fianna Fáil completely side-stepped. The European Commission has taken a vital step in standing up to producers of big heavy polluting cars and this cut should do much to tackle greenhouse gas emissions across Europe. However, this figure relates to average output and while there are many makes of car that already emit less than 130 g of CO2 per kilometre, there are other makes of large luxury cars producing twice the target amount.

A carrot and stick approach is needed to confront these polluters. In power, Fine Gael will reduce emissions from vehicles by establishing a system of energy-efficiency labelling for vehicles and rewarding those that are awarded a higher rating with a reduced rate of VRT. Similarly, vehicles with a lower rate of efficiency will be penalised with a higher rate of VRT. Fine Gael published this policy as long ago as November 2005, inviting the Government to adopt the proposal as it is vital carbon dioxide emissions are cut. Fianna Fáil completely ignored this issue, blocking Fine Gael's VRT plan and providing a 12-month window in the last budget for a massive increase in sales of vehicles that emit huge amounts of greenhouse gas.