John McGahon (Fine Gael) | Oireachtas source

The electricity costs emergency benefit scheme we are talking about forms part of a package of budget interventions put forward in October 2021 by the European Union, including the Commission's toolbox of interventions that allow member states to go about tackling rising energy costs. I ask everyone to read the supporting documentation today. It is really interesting. The tools will serve as an important part of our arsenal, not just in the next 18 months but also over the next eight years as we move towards our target of having 70% of our energy generated from renewables.

Some of the price hikes that are due to be implemented in April are quite worrying. I can see why they are so worrying for consumers but that is why it is so important to expand on the emergency measures the Government is taking to allay their concerns. SSE Airtricity's electricity price is to rise by 6.2% and its gas price is to rise by 4.5%, effective from 1 April. Energia announced an electricity price increase of 8.6% and a 5.7% in gas prices, effective from 5 April. Panda Energy announced an electricity price increase of 7.5%, effective on 8 April. Flogas announced an electricity price increase of 8.5% and a gas price increase of 6.5%, effective on 12 April. We are not facing these increases only in Ireland but also right across the European Union. The reason is the increase in global demand as we exit the pandemic. However, it is important to remember that, as Senators have said, markets are expected to stabilise at some stage, possibly early this year.

While the instability exists, it is important to be able to introduce emergency measures such as the one under discussion. As Senator O'Reilly said, we decided not to go ahead with pre-legislative scrutiny to allow us to introduce it across the board very quickly. That is what is really important about it. There could be further instability between now and 2023. It will then be really important for the Government to rely on the European toolbox of measures. It could be really useful. There are many decent suggestions in it. We are going with the main suggestion, which involves member states making payments to those most at risk in paying their energy bills. This is being financed through the EU emissions trading system. Along with implementing such measures, it is important that we consider introducing safeguards to make sure energy companies cannot disconnect people's energy supply. This would be useful if people were to fall into arrears and things got worse.

There are many other measures we could introduce. The measure being introduced is just one of a suite of measures. If things get worse, we can introduce an energy taxation directive whereby we can temporarily exempt vulnerable households from tax, or apply a reduced tax rate, directly in respect of electricity, natural gas, coal and solid fuel. We could also do a lot to empower and protect consumers here in Ireland. We could provide people right across the country with quality information and options regarding how they can participate in the energy market. Making the switching of suppliers faster and easier is one way we can go about this. We can further boost the role of consumers in the market. We plan to do this by giving people the ability to generate their own electricity. They will be able to use it themselves or sell it back to the grid. I am trying to talk about a range of measures we can implement as a Government if we come across further price instability in electricity markets.

On the point on selling energy back to the grid, creating our own energy and having energy communities, I want to make a small diversion into the topic of solar energy. Both solar and wind energy will play such an important role in hitting our targets by 2030 and reducing our reliance on fossil fuels. By reducing our reliance on fossil fuels, we will decrease the possibility of price instability. I raised with the Minister at a committee meeting a couple of months ago the impact of capital acquisitions tax on the agricultural community and renewable energy sector. The current rules for the tax state those who inherit agricultural land can get a relief of 90% on the market value of the asset, but this is contingent on the total amount of land being utilised for solar panels constituting less than 50% of the total landholding. This threshold of 50% needs to be removed because the point is that we will not be able to incentivise people in the agricultural community to move into full-blown solar farming if their capital acquisitions tax is to be impacted if they wish to inherit a farm. We want people to be able to fill a large field fully with solar panels, not 49.5% or something like that. We should remove a barrier that exists in the agricultural community. The Minister for Finance, Deputy Donohoe, will have to examine this. I spoke to him about it before. I would appreciate it if the Minister for the Environment, Climate and Communications and I could meet briefly to discuss it. He could pass on my concerns to the Minister for Finance. Addressing the capital acquisitions tax issue would be a simple way to remove a barrier that exists, making sure people who want to get into solar energy can do so as easily as possible.

Former President Mary Robinson mentioned earlier that people can be scared by the science and nuance of the climate action debate. I found this myself when I first got involved as a climate action spokesperson 18 months ago. Trying to get involved in the climate action debate can be intimidating when you are up against people like the Minister, Deputy Eamon Ryan, and others who have been involved in it for decades. What we need to do is make it as simple as possible for the average Irish person to engage in the debate. We can do so by making measures financially viable for people. We are doing this through the retrofit programme, the introduction of so many electric-vehicle charging points and making so many grants available. We are making it financially simple for people who want to live a green and sustainable lifestyle. We are making it financially possible but also as hassle-free and easy as possible. An example of where we are doing this relates to the concept of the one-stop shops for the retrofit programme, whereby someone will project-manage the whole thing.

I went off on a slight tangent but my point relates to solar energy. If we want people in the agricultural community to engage in solar farming on a wide scale, we really need to remove the 50% barrier. I am interested in hearing the Minister's thoughts on that.

While we move towards renewable energy, we should note that it promises much lower prices in the long term. Over the short to medium term, consumers may have to deal with the price instability we are seeing, but the whole point of the legislation we are introducing today and the suite of measures the European Union has said we could introduce, including the toolkit, is to address this instability.While we are making the transition to a renewable energy economy and working hard over the next eight years to get to the 70% target for wind and solar energy, we must be able to introduce emergency measures or at least have fallback plans or measures that can be introduced, as we are doing now, to protect the Irish consumer against instability in energy prices. This is a good example of one way of doing that, but it is just one of many other tools in the armoury that will be open not only to this Government but to all member states in the European Union.