Friday, 17 July 2020
National Oil Reserves Agency (Amendment) and Provision of Central Treasury Services Bill 2020: Second Stage
I thank the Cathaoirleach and congratulate him on his own elevation. I do not think I have seen him since he was appointed to his new role. I wish him the best of luck with it.
The overall purpose of the Bill is to amend the National Oil Reserves Agency, NORA, Act 2007 to provide for the establishment of the climate action fund on a statutory basis, extend the purposes for which the NORA levy is paid to include funding the climate action fund and provide for the payment of a portion of the levy moneys collected by NORA to the fund. The NORA levy is collected at a rate of 2 cent per litre on most oil products placed on the market and is used to fund the activities of NORA, primarily in the maintenance of the State's strategic oil reserves. The amendments to the NORA Act provided for in the Bill will allow for the repurposing of NORA levy moneys to support projects and initiatives from the climate action fund and contribute to achieving the State's climate action goals in a cost-effective manner. It is appropriate that surplus NORA levy funds, which are levied primarily on the use of road transportation fuels, are repurposed to assist our national decarbonisation effort. This is entirely consistent with the established polluters pay principle.
The Bill also amends the National Treasury Management Agency (Amendment) Act 2000 to provide for NORA and Irish Water as designated bodies to which the National Treasury Management Agency, NTMA, may provide central treasury services. This allows the NTMA to take deposits from or make advances to NORA, or both, as an alternative to the current utilisation of the commercial banks. It also facilitates the restructuring of Irish Water's funding arrangements, whereby existing short-term funding from mainly commercial banks can be replaced with more competitively priced State-funded debt facilities. Provision is also made in the Bill to provide for technical changes to the biofuels obligation scheme and for fixing of the rate of the biofuels levy to a nominal amount to incentivise the use of biofuels.
We need to show increased ambition and leverage every available mechanism at our disposal to ensure we can deliver the type of innovative projects that will place Ireland at the forefront of the green economy and develop our green infrastructure. In doing this we must ensure no region of the State is left behind as Ireland transitions towards a low-carbon society.
This need has come into sharp focus recently with the announcement that Bord na Móna will suspend peat harvesting and concentrate on enhanced peatland rehabilitation. My Department is examining the potential of the climate action fund to support this work, which will rehabilitate bogs that were formerly milled for peat used in power generation, turning them into effective carbon sinks. As well as providing for carbon sequestration, this work will generate employment for workers previously employed in the milling of peat.
While the fund is clearly focused on climate action, it has also considerable potential to support sustained post Covid-19 investments in infrastructure with resulting positive impacts for economic growth and job creation in communities across the State. The fund's first call led to supports of up to €77 million but is expected to leverage a total of €300 million of investment within the State. Projects being supported on the first call include the national roll-out of ESB electric vehicle high-powered charging infrastructure, supported up to €10 million; Dublin City Council's Dublin district heating system, supported up to €20 million; Gas Networks Ireland's green renewable agricultural zero emissions gas, supported up to €8.5 million; Irish Rail's hybrid drive for intercity rail cars, supported up to €15 million; the local authority public lighting energy efficiency project, supported up to €17.5 million; South Dublin City Council's Tallaght district heating scheme, which uses excess data centre energy, supported up to €4.47 million; and the 3 Counties Energy Agency project to increase efficiency in the road haulage sector, supported up to €1.37 million. On the enactment of the Bill, it is planned that the fund's second call for applications will open as soon as possible. Based on expressions of interest made to my Department, there will be considerable demands on the fund to support a range of both community-based projects and large infrastructure projects in both the public and private sectors.
This Bill contains 28 sections. I will explain the key provisions within it. Section 5 amends section 8 of the National Oil Reserves Agency Act 2007, expanding the functions and powers of NORA to enable it to pay levy funds into the climate action fund as directed by the Minister.
Section 13 amends section 37 of the National Oil Reserves Agency Act 2007, expanding the purpose for which the levy is paid from the current purpose of funding the expenses of NORA to also include contributing to the climate action fund. This section also sets the rate of the levy at 2 cent per litre by statute.
Section 14 is an important component of the Bill. It amends the National Oil Reserves Agency Act 2007 to permit the Minister to issue an annual direction to NORA to pay a specified amount of levied moneys into the climate action fund. This section provides that only levy moneys collected and recovered after the legislation has commenced may be paid into the climate action fund. Prior to making a direction, the Minister is required to consult with NORA, the Minister for Public Expenditure and Reform and the Minister for Finance. The Minister is also required in making a direction to be reasonably satisfied that NORA will have adequate financial resources remaining after payment has been made to meet its expenses during the remainder of the financial year. In addition, the Minister must consider the amount specified to be appropriate having regard to any further expenditure which may be required by NORA in subsequent years.
Section 15 fulfils the important function of establishing and providing governance arrangements for the climate action fund. The fund shall be controlled by the Minister or by persons to whom the management and control of the fund has been delegated by order of the Minister. The funds will consist of such accounts that the Minister shall determine as necessary. Provision is made for the submission of the accounts of the fund to the Comptroller and Auditor General for audit and the laying of a copy of his report and the audited accounts before each House of the Oireachtas. The purpose of the fund is outlined, which includes supporting projects, initiatives or research that seek to reduce greenhouse gas emissions, to increase the production or use of renewable energy, or to improve energy efficiency in the State. In addition, provision is made for projects or initiatives to support regions and sectors of the economy affected by the transition to a low-carbon economy. Provision is also made for the Minister to invite proposals to avail of moneys from the fund. Moneys may only be paid from the fund to persons who have conducted projects in accordance with the guidelines specified by the Minister in consultation with the Minister for Public Expenditure and Reform. A committee may be established to advise the Minister on any aspect of his or her functions relating to the fund.
Section 22 makes a technical change to the National Oil Reserves Agency Act 2007 with regard to the administration of the biofuels obligations scheme. The amount of biofuels certificates from the two previous obligation periods which may be used in the current period is reduced from the previous cap of 25% to a new cap of 15% of the obligation.
Section 24 amends the National Oil Reserves Agency Act 2007 by setting the rate of the biofuel levy at one tenth of a cent per litre of biofuel placed on the market. Setting the rate of the biofuel levy to a nominal amount removes an anomaly whereby the levy placed on biofuels is the same as that on petroleum products placed on the market.
Section 28 amends section 18 of the National Treasury Management Agency (Amendment) Act 2000 to provide for the designation of both NORA and Irish Water as designated bodies to which the NTMA may provide central treasury services. This allows the NTMA to take deposits from and to make advances to the agencies as required. NORA will be permitted to deposit moneys with the NTMA as an alternative to its current use of commercial banks. This provision also facilitates the restructuring of Irish Water's funding arrangements.
This Bill takes the opportunity to repurpose surplus NORA levy funds and to make them available to the climate action fund, thereby supporting projects that will assist the State in its progress towards net zero carbon emissions by 2050. It also establishes the climate action fund on a statutory basis, enabling it to both receive levy funds and administer the provision of these funds to projects.The funds offer very real potential to support employment and economic development by expanding the green economy in all of the regions of the State, while at the same time supporting a just transition for regions and sectors formally dependent on high carbon activities. I commend the Bill to the House.
I am delighted to welcome the Minister to the House. When Fianna Fáil, Fine Gael and the Green Party put aside their differences to form a Government they did so to try to create a stable Government that would address climate change and the threat of Covid-19 and re-establish our society and economy. This third piece of legislation that has been brought before the House today is a manifestation of the Government's serious commitment to start to address climate change and take climate action.
The Bill aims to deliver on the Government's promise in the programme for Government to strengthen the action of the Government and the State on climate change. I thank the Minister for bringing forward the legislation. Its Title, the National Oil Reserves Agencies (Amendment) and Provision of Central Treasury Services Bill 2020, is a mouthful. With a Title like that, it is no wonder people outside the House wonder what we talk about. It is very important legislation. While it is a technical Bill, in plain English what it will do is put the climate action fund on a statutory footing, which means the State will commit to the climate action fund. It will make available to the climate action fund any surplus from the fossil fuel levies so the climate action fund can use the moneys to take climate mitigation measures. This is very welcome.
The Government has promised that in the years until 2027, close to €500 million will be dedicated to the climate action fund. It is estimated that by passing the Bill, a minimum of €50 million from the national oil reserves agencies will be given to the climate action fund. This is very important because this €50 million, while not enough in and of itself to take on all of the climate mitigation measures that will be required, will give vital support and funding to initiatives that can help us address climate change.
The primary aim of the climate action fund is climate mitigation measures but the fund can also help us address Covid-19. In speaking about it today, I want to address four areas, particularly from a Dublin perspective, that I would like to see the Government use the climate action fund to address. These are congestion, housing, jobs and illegal dumping. Dublin is the 17th most congested city in the world and the sixth most congested city in Europe. This takes an enormous toll on the lives of people who are trying to work and live in the city. It makes it a very unpleasant place to live. It is unhealthy, unsustainable and unacceptable. It is right that the Government addresses it and it can use the climate action plan to start to do this.
Back in 2009, there was a smarter travel policy that aimed to reduce work-related travel and commuting by private car by approximately 20% but the policy did not achieve its aims. It is urgent that the Government use the climate action fund to address congestion. I encourage the Minister to use the funds to enable people to move away from petrol and diesel cars and invest in electric vehicles. Critically for public transportation in the city, the public bus service is very friendly. It has kept going and has been available to us all during Covid-19 but we need more bus services. We need the service to be more reliable and more affordable. Most important from the perspective of this fund, we need it to be more energy efficient and environmentally friendly.
With regard to homes, 10% of our carbon emissions come from the residential sector and here in Dublin we have a very old built environment. Private and public residential homes, including those owned by Dublin City Council, are very old.Many of them are poorly insulated, poorly heated and unable to deal with our damp, wet environment. People living with asthma, chronic obstructive pulmonary disease, COPD, and other respiratory problems were struggling in those homes prior to Covid-19, but now the impact of Covid-19 on them is enormous. In my constituency of Dublin Central, flat complexes such as Henrietta House, Greek Street Flats and Chancery House are fine architectural and important structures for our city, but they are quite uninhabitable for many of the tenants. We must use some of the climate action fund to address the inadequacies of those homes. There is a commitment in the programme for Government to retrofit 500,000 homes and this fund will help that, but it is important to accelerate that programme as soon as possible.
With regard to jobs, yesterday we discussed legislation that will enable the State to participate in European funds, which is very important. Employment is at an all-time low and youth unemployment is at a critically high level. We must take every action possible and be radical and ambitious to ensure that youth unemployment and long-term unemployment do not take hold. The climate action fund can support the protection of jobs and the creation of new jobs, as well as the upskilling and retraining of workers and jobseekers. I urge the Minister to use the climate action fund to do that.
Illegal dumping might seem to be a small thing, but it is a critical issue throughout the country. It is an acute problem in this city. Illegal dumping contributes directly to our greenhouse gases and carbon emissions. We talk about it a great deal but we must tackle it. If we tackle it we will reduce our greenhouse gases and carbon footprint. Dublin Central and the north inner city are repeatedly highlighted as an illegal dumping and litter black spot. That is unacceptable. Dublin City Council is trying to be innovative and is taking initiatives. I urge the Minister to use the climate action fund to support local authorities and local groups. Many voluntary groups give their time voluntarily to go out at weekends or after work in the evenings to clean up our streets. We must support those groups as well.
Finally, we are used to seeing forest fires in California and Australia, but it is startling to have Siberian forest fires in the Arctic. It is a wake-up call for all of us. Climate action is something we all must take seriously and we all must make individual efforts, but we cannot expect individuals alone to do it. The State must commit to this and that is what this legislation does. I commend the Minister on bringing the legislation forward. Fianna Fáil will support it and we look forward to working with the Minister in making it a reality.
I welcome the Minister and congratulate him on his new role. As my party spokesperson on climate, communications, energy and natural resources, I am looking forward to working with him in the next couple of years. Indeed, I was talking to a former colleague of the Minister's in Dundalk a couple of hours ago, Mark Dearey, who is a former Member of this House. I worked very closely with him on Louth County Council and had a wonderful relationship with both him and Councillor Marianne Butler, so I am very much looking forward to working with the Minister.
This legislation is quite straightforward and simple. We are repurposing the NORA levy and directing it towards funding for much more worthwhile projects under the climate action fund. The climate action fund will support initiatives that will contribute to the achievement of Ireland's climate and, more importantly, energy targets. I was examining this last night and it offers the potential for interventions for which funding would not be available without this fund. That is an important point we all must recognise. The seven projects we have been discussing would not be able to proceed without the funding from this body.
I listened to the speeches on Second Stage in the Dáil in the convention centre and some of the comments made by the Deputies were quite disingenuous. They tried to say that the seven projects were a little too Dublin-centric.Of course, this fits into the narrative they want to put forward to show that rural Ireland is somehow missing out. As someone from the town of Dundalk, County Louth, I can certainly say that that is not the case with this legislation because, and I will be quite clear about this, the expressions of interest clarification note for the climate action fund was clear. I will quote from it in order to put it on the record of the House:
[The Department] is not selecting or focusing on any type of organisation, project or technology [or geographical area]. The CAF is not in the style of a tendering process; instead it is up to organisations to apply with what they believe is the best Climate Action idea. Fundamentally, the CAF is a competitive process in which [the Department] seeks to support a project, or group of projects, that will have the best impact across a range of indicators in achieving a low carbon climate resilient economy.
That is what the Government said in black and white, so it is very disingenuous of Members of the other place to try to suggest otherwise.
Of the seven projects already approved, three stand out as being quite impressive. The first was a €15 million investment in the new hybrid power packs for the intercity railcars. This has already been trialled with them. The concept went very well and the investment will now be rolled out to all our intercity rail fleet. That will take anyone on a train from Dundalk, Wexford, Athlone, Cork or Limerick to Dublin. It will really reduce diesel use and greenhouse gas emissions and benefit thousands of commuters at the same time.
The second project I really liked was the local authority public lighting energy-efficiency project. The concept is to retrofit 326,000 non-LED lights throughout the country. I have already seen how effective this has been in my part of the world, County Louth. Louth County Council has embarked on a really ambitious project of replacing nearly all non-LED lights. It is doing so well. The county council has to be commended on this project. The project alone - and this is the most important point to note about non-LED lights - will see an emissions reduction of over 40,000 tonnes of CO2from electricity generation per annum.
The third project I wish to speak about is really good and something in which I have always had a strong interest throughout my time in politics. I refer to the €10 million for the ESB e-cars. The project will essentially help to develop a nationwide charging system. This is perhaps one of the most important parts of what the climate action fund will be able to do because it is crucial we direct even more funding towards this. I am 29 years of age. I look at my friends and think that the uptake of e-cars will not improve until people can realistically get from Dublin to Cork without experiencing battery anxiety or the fear that if they get to Portlaoise and pull over to recharge, the charging stations will not be working. Will someone be parked in the charging station while having lunch inside? The only way we can change the culture and people's minds, say this is the way to go and bring people with us is to pump so much funding into electric vehicle charging areas that the concept of battery anxiety will be a thing of the past and people will not even consider it when they consider buying e-cars. The more charging points we can create and the quicker the better because it will take an effort to change people's minds and bring them along with us.
A final point about this, and one I made recently when I was on Louth County Council, is that it is very important local authorities come to the Minister with roadmaps of their own local authorities, counties and administrative areas and say, "Minister, if you give us X amount of money tomorrow morning, this is exactly where we will roll out our electric charging points." It would be incumbent on the Minister and his Department to turn around and say, "Okay, we will do this, providing you put in X number of charging spaces", and give the local authority a timeframe by which this would have to be completed before they would lose the funding. That would put the onus back on the local authorities to deliver this at a local level, where, with all due respect to the Minister, they know best.
Those are just three projects out of the seven that will benefit everybody on this island, whether one lives in Dublin city centre or up the side of a mountain in Kerry. I wish to put that on the record of this House because it is so disingenuous of other people, for the sake of their own political narratives, to try to suggest otherwise.
I will wrap up. I know I have two minutes left, unlike yesterday, when the clock was going the other way. My point is-----
No, it is all right. I will be like Cicero. I will be brief, as the Cathaoirleach has said.The point of this climate action fund and reducing the NORA levy is to create far more projects that are sustainable, such as the seven already outlined. People from communities would be able to come to the Government or the Department and say they have an idea and run with it. It is such a wonderful way to engage local communities and it is definitely one of the big vehicles we can use to reduce greenhouse gas emissions over the next ten years. It is important to stress that it would be very difficult for those projects to find funding otherwise.
This is forward-thinking legislation. As Senator Fitzpatrick said, it is quite technical but it is such a pleasure to see it in the Seanad's first proper week of sitting because that shows the urgency behind this Bill and how committed the Minister is to it. I commend the Minister on bringing the Bill to this House so quickly. It is a much-needed measure and I find it very hard to see how anyone could disagree with it. The sooner we get it through this House, the better.
I welcome the Minister to the House. From his perspective, the primary purpose of this Bill is the establishment of the climate action fund. Like everyone else, we welcome the establishment of a climate action fund. However, there is much within that and during the debate in the other House, much of the focus was on what it might fund and the scope and parameters the Minister effectively gives himself in its operation. Some very constructive amendments were tabled which thought in an imaginative way about how that fund might be used and it is regrettable that the Minister did not feel able to accept them. That is important because we will see a lot of legislation moving rapidly and there is no reason not to accept an amendment during the early Stages of a Bill. It would not have added any further time or debate because the Bill as amended would simply have come to us. It would not necessarily have added any time if constructive amendments had been accepted. That is important because we are going to be getting proposals and if this is a collective challenge on climate change, all Ministers, not just Deputy Eamon Ryan, need to be able to take positive proposals whenever and from wherever they arise.
I will not focus much on the content of what the fund might fund, with one small exception. The Minister spoke about what we hope will be a just transition for sectors of the economy impacted by the actions that need to be taken. However, this should be about sections of the economy and society because we are not simply an economy, but a society as well. Even rural Ireland is not simply an economy or a number of business actors. It is a society. Measures taken through the climate action fund may also serve to sustain societies that are impacted, not necessarily solely focusing through the lens of the economy. It is incredibly important but the economy is only part of the picture.
With due respect to Senator McGahon, I heard alarm bells when he noted that, without this fund, the money would not be available for all these necessary things. Let us be clear; these things are not a wish list. This fund is not a bonus or a prize. These are the essential things we have to do. The climate action fund may have a purpose but these things are necessary. I would like the Minister to put on the record the fact that the climate action fund is not the limit of our ambition when it comes to spending, expenditure and all the projects we are taking forward. In his speech, the Minister spoke about large infrastructural projects. Such projects, which are needed in respect of climate action and biodiversity, must come from every part of our budget. They should not be limited to those selected through competition for the climate action fund. The climate action fund has an important role in identifying cutting-edge new projects, interesting ways of thinking, getting different sectors on board and delivering just transition. Those are important things that it can contribute to but it cannot be the limit of our ambition. I ask the Minister to give us a wider sense of where the climate action fund fits into the financial and fiscal ambition on climate action within this Government. For example, perhaps he could address the European Investment Bank, EIB, fund that went through yesterday. That fund does not contain the hundreds of millions of euro that the climate action fund might, but billions of euro. One of the European investment fund's stated main objectives is climate mitigation and adaptation.How will the Minister ensure that the main objective, which sits within that fund, is reflected in how Ireland engages with the fund?
Regarding the EU recovery fund, which is yet to be finalised and to come before this House, it may include up to €500 billion in grants for countries across Europe. How will we ensure that climate action, biodiversity action and all those elements are reflected in that initiative? This conversation is not simply about our budget. It is part of a European conversation now and Ireland has a leading voice in that context in respect of the beneficiaries, the focus, the priorities and the policy-thinking regarding the funding we are putting towards Europe's recovery. I would like if the Minister could reflect on those aspects and where the fund fits into that wider fiscal picture.
The Bill is not only about the climate action fund. It also concerns an opening up of the National Oil Reserves Agency Act 2007 and much has changed since 2007. The Act was then primarily focused on energy security, but now we know we are facing a climate crisis as well. There is a need to level-up and this is an opportunity to improve the legislation so that it reflects the reality.
I will give a simple example. I suggest that it might be useful to have someone with expertise in climate science on the board of the National Oil Reserve Agency. While we are buying oil and other reserves, therefore, there would be someone who acknowledges how that fits in a broader perspective. I refer to there being consistency regarding Ireland having an emergency supply, which it must have, but that we also think about divestment and reflect in our international conversations a balance of divesting while having this reserve. We should also think about a sustainable energy reserve for the future. I refer to sustainable energy storage, battery power and other technologies. It is often suggested that there is tension between sustainable energy and energy security, but this is the chance to tackle this issue by having a sustainable energy reserve and making sustainable energy part of our back-up plan as a State.
I turn now to the clean-up costs. As my amendment in this area has been ruled out of order, I am going to highlight it and the Minister might then address it. It is a serious concern as companies are leaving the oil and gas sector that they are leaving massive costs behind for the public. Analysis by Rystad Energy has estimated that 250 oil and gas companies might go broke in America before the end of the year. Just one of them could cost $40 million for a clean-up operation. Another company gave $15 million in cash bonuses to its executives and then filed for bankruptcy six days later. That is why I am suggesting we might need a further levy on the capital and other assets of oil companies to ensure that they are preparing us for the cost of their exit from the oil and gas sector and that they are contributing, not on disposal, day-to-day costs or what customers are paying, but on those assets so that we are prepared for the outcome. In the end, it will often be the State that will end up doing much of the clean-up in this area.
I also want to highlight the question of capital assets. When we look at that issue, how do we ensure that we do an audit of the existing oil and gas infrastructure in the State? How can we ensure that the Minister can be informed and have the relevant figures and information that he needs? I tried to give those powers to the Minister in my amendments to the legislation. I will be able to press forward with some of those, but not with others.
I would also like the Minister to address how this levy will be reviewed, because this is a changing landscape. We have seen that oil and gas companies are collapsing and we know that Brexit is around the corner, so this is a shifting landscape. Regarding the 2% levy, Deputy Naughten made some constructive suggestions on giving the Minister the power to move to a 3% levy, for example. I am also trying to give the Minister the power to extend the areas from which the levy might draw. Will the Minister tell us how he will be monitoring that aspect and will there be a plan to open this legislation again? That seems unlikely, so that is why I am trying to get all these powers into the hands of the Minister now.
I know the purpose of today's Bill is to amend the National Oil Reserves Agency Act 2007 to facilitate the establishment of the climate action fund on a statutory basis. Given that we are in a climate emergency, a climate action fund is essential so we can carry out the necessary mitigation and adaptation measures to reduce our emissions and to protect those communities most vulnerable to the impact of climate change.Sinn Féin is happy to support this Bill but we would like to make several recommendations and observations. I welcome the Government's amendment to facilitate funding projects of a non-commercial nature. I would, however, encourage the Minister to ensure that project tenders, including those of an economic or commercial nature, would include social clauses. Such clauses can ensure that the local community can avail of job opportunities and social enterprises. The community and voluntary sector should not be excluded from tendering for projects, even for commercial tenders. We have seen first-hand the importance of this sector in the circular economy whereby jobs and training opportunities for disadvantaged workers have been created.
What protections and oversight mechanisms will be put in place regarding the decision-making for the projects? We cannot have a situation whereby Ministers can have pet projects for their constituencies. We have seen the outrage from people who were not appointed Ministers. They said their constituencies were let down. How can we ensure that it will not be like the Lotto funds and other funds that Ministers will allocate for their constituencies?
I wish to speak in favour of the amendment tabled by Senator Higgins on the scaling down of oil and gas in future. To meet our Paris agreement obligations we will have to decarbonise as rapidly as possible and shift away from the use of fossil fuels. We have seen growing concern in the United States about the stranded assets of oil companies. Chief executives have paid themselves out, as my colleague has said, handsome packages a week before filing for bankruptcy without ensuring that the finances were in place to restore the wells to their original state. Instead, they have left citizens with the bill for cleaning up while methane continues to leak into the atmosphere. Can the Minister outline how the National Oil Reserves Agency will ensure that the oil and gas companies in Ireland are adequately funded? Will we have a cast-iron, ring-fenced fund to ensure that we are not left with a situation similar to that in the USA?
I am keen to flag some concerns I have regarding biofuels. In this Bill the levy on biofuels is lower than on petroleum. As the Minister has said, this is in a bid to incentivise the use of biofuels. However, the Government does not have a good track record in ensuring biofuels in the Irish market are sustainably sourced and not the cause of indirect land use change. In fact, only last year the European Commission wrote to the Government about its failure to properly transpose the EU directive on biofuels to ensure the sustainability criteria were met. We know these sustainability criteria are already deeply flawed because they do not take into consideration the entire life cycle of the emissions of the fuels. While the phasing out of palm oil is welcome, it needs to happen far faster than by 2030. What are the Minister's plans to electrify road haulage and public transport? The idea would be to move away from reliance on biofuels. Surely this should be the priority.
I note aviation fuel is exempt from the Bill. I understand addressing this may be a matter for the EU. However, will the Minister pursue changes to this when he next meets his European colleagues? I suggest that in the absence of an aviation fuel tax perhaps we should consider introducing some form of tax on private jets. For example, an individual, who shall not be named, over the course of two and a half years took 698 flights on his €70 million private jet, all in a bid to avoid paying tax in this State. Surely if the Minister stands over the quadrupling of the carbon tax, then he would consider tackling wealth and consumption. This is one such measure that could be taken on board.
I wish to ask the Minister about the financial future of this fund. I note the projected funding is €500 million with annual funding of at least €50 million per annum over ten years. If our long-term goal is to rapidly reduce our reliance on oil and gas, then surely the amount raised in the levy will decrease accordingly. How is this being taken into account? The Bill states that annual expenditure will be €10 million in 2020, €30 million in 2021 and will increase to €100 million in 2027. Surely it would make sense to reverse that and front-load the funding. If we are doing our job right in tacking climate change, then income from the levy should be decreasing over time. Moreover, the Government is rolling out a July stimulus package.Surely it makes economic sense to front-load the investment from the climate action fund to create jobs and accelerate emissions reduction. More crucially, front-loading would also help mitigate against the impacts on struggling families of the increases in the levy and carbon tax. I would appreciate if the Minister could address some of those points.
I welcome the Minister, Deputy Ryan, to the Chamber and wish him well in his new job. I had the pleasure of working with many close colleagues of the Minister on Dublin City Council and they are among the most talented of politicians. We shared a great deal in common with respect to how things worked at local authority level.
The Labour Party welcomes the provisions of the Bill and the establishment of the climate action fund. However, we will support Senator Higgins's amendment.
As a word of warning, my party does not believe the challenges of climate change will be tackled by solely relying on a levy on fossil fuels. I echo the call of my colleague in the Dáil, Deputy Duncan Smith, for a further debate on how we will fund the climate action plan. Deputy Smith also asked if there is a timeline for putting the climate action fund on a statutory basis beyond this Bill.
My colleague, Senator Hoey, will address the question of a just transition, particularly for workers employed in what are now considered to be dirty industries. We in the Labour Party will not tolerate a transition that does not put workers and the right to be employed in secure, well-paid jobs at its heart. There can be no green transformation without fairness and justice for workers at its heart.
The first call for applications includes some very good projects, particularly systems such as district heating in Dublin city and south Dublin. However, the second call needs to provide for more investment in retrofitting local authority housing stock, to which Senator Fitzpatrick referred, and for grants to local authorities to make their housing stock and systems more energy efficient, particularly in areas such as green roofs. When I and a couple of the Minister's Green Party colleagues pushed for green roofs to made part of the plans for the development of Chamber Street flats, we were told there was no funding available and there were also issues with sustainability. I would like more funding to go into research on how we can come up with innovative ways of making existing stock and new housing stock more passive, while also mitigating against the flood risks in Dublin, including in the city.
I am a little concerned about the previous Government's approach of pushing electric vehicles. I would like greater investment in sustainable forms of transport and public transport, rather than in moving the car stock from fossil fuels to electric vehicles. The societal cost of congestion has to be incorporated in that. I do not want a significant amount of funding from the climate action fund allocated to funding electric vehicles because they lead to an unsustainable use of land and road space. We need greater investment in sustainable forms of transport, in making our public transport system electric and also, potentially, making it free of charge. I certainly welcome some of the moves by local authorities over the course of Covid to make our roads more cycle-friendly.
One of my concerns about the second round of applications is that the projects that have been funded to date have been large, require large organisations to get involved and feature a great deal of research and development. I would like to see this move towards smaller community initiatives, not to become like lotto funding and the sports capital grants but to ensure that local communities are able to come up with bottom-up ideas that might work in their local areas. A community fund should be established to which communities could apply for small amounts of funding. It should be administered through the local authorities or local communities.
I will now address the issues of density in cities, city fight-back against climate action and the need to invest more in green spaces. As I stated previously, this is not only important for the health and well-being of people in cities. It is an important part of our flood defences.What were one in 100 years flooding events within cities will now become more frequent. We need to have a way to make smaller concrete spaces greener, for example by putting in pocket parks, to assist in our flood defences. Small things such as giving people grants for gardens and for green roofing would represent an investment in our flood defences.
I welcome the Minister, Deputy Eamon Ryan. I reiterate my Labour Party colleague's support for the Bill. We broadly agree with the principle of developing a €500 million climate action fund from the proceeds of an existing levy paid by all companies and using it for climate action projects to decarbonise the economy. It is not, however, a suitable long-term plan to fund our climate action plans from revenue collected from burning fossil fuels. It is important that a long-term strategy is put in place to fund the climate action plan sustainably. I reiterate Senator Higgins's point that this fund cannot be the limit of our ambition.
As mentioned earlier, the greatest concern for the Labour Party is that workers and households do not bear the brunt or costs of moving to a sustainable economy. There can be no climate justice without social justice. We must ensure a just transition to a low-carbon economy. The State must ensure job guarantees to any worker who faces a potential job loss due to the climate action plan. We must ensure workers in high-emission industries will have reskilling opportunities, retraining and alternative employment. A just transition must be ensured for all regions in Ireland. There is massive concern currently in the midlands in particular around jobs. We must invest in State enterprises such as the ESB, Coillte and Bord na Móna to create new sustainable jobs in clean energy, recycling and land management. I wish to highlight that Bord na Móna is investing in taking people off the milling of peat and moving them into the rehabilitation of peatlands. Will the Minister confirm today that a just transition for workers will be central to the climate action plan? It is crucial and it creates great anxiety for many people. Professor Hans Bruyninckx, director of the European Environment Agency, has outlined that:
A socially just transition planned and implemented over a long term is the only way forward to build a resilient society with a strong and sustainable economy. Moreover, the investments we will make to mitigate the economic impacts of this [Covid-19] crisis should be, and can be, fully aligned with our long-term sustainability goals.
The only way to ensure we have a strong and stable economy is to bring every worker with us. With this change comes great opportunity and this fund will be essential as we look forward. Workers are essential to the just transition to a sustainable green economy. For every penny spent out of this fund we must look at how to mitigate the climate crisis, invest in communities to ensure they are living green and ensure every worker has a sustainable future.
I very much welcome the Bill and I am particularly delighted that the implementation of the legislation will put the climate action fund on a statutory footing. I welcome also the commitment that once the Bill becomes legislation and is commenced there will be a second call for projects to be announced. It is on the subject of one of those projects that I wish to address the Minister.
I bring to the Minister's attention a group calling itself Metro South West. This group, headed by Pauline Foster and Seán Ward, comprises a collection of volunteers and more than 30 residents' associations contained within the Dublin South-Central and Dublin South-West constituencies. They have carried out Trojan work relating to the MetroLink project connecting Firhouse with Rathmines and taking in Kimmage and Harold's Cross, which are within my Dublin South-Central constituency. A commitment to carry out a feasibility study for this proposed metro line was given by all three Government parties in their election manifestos, and supported by the Minister, Deputy Eamon Ryan. A meeting is being sought with the Minister to advance the discussions on that feasibility study. South-west Dublin is the triangle between the green and red Luas lines, but not served by them. The area has only buses as its public transport options. This stands in sharp contrast to south-east Dublin, which is served by the DART, the Luas and a quality bus corridor. The population of the south-west Dublin area proposed to be served by the MetroLink well exceeds that of the catchment area for the Luas green lines. It has been suggested that this is not the case, but arguments that the population is insufficient are simply incorrect.
One of the members of the group, Pauline Foster, managed to get her hands on a 1973 bus timetable.In that, she made a comparison with the bus seats in 1973, with a much smaller population than now. Even if BusConnects delivered everything, including its spines, it is still less than we had with a much smaller population in the area.
We have a unique opportunity with the metro tunnel boring machine that is proposed to be abandoned underground to do something really significant. I strongly advocate that instead of being abandoned, it is turned slightly and moved over in our direction to provide an excellent and energy sustainable public transport option. The benefits are immense. In this area, there is more than 70% reliance on private cars. Modality conversion would be guaranteed and pay dividends on the investment in the environment and quality of life for our residents. Efficiency and diversity of choice in public transport makes hospitals, workplaces and the city more accessible. The more accessible the city, the more life we have in our city centres for families to enjoy it and to have the experience of vibrant city life, as well as all the environmental benefits, which we do not need to lecture the Minister on.
The plans for the metro route are not new. As long ago as 2001, the Dublin Transportation Office published a report entitled A Platform for Change, modelling a bus-only solution. That report stated: "In summary, the analysis of the 'Comprehensive Bus' scenario established that buses alone could not address the problem because in many of the main transportation corridors the bus mode cannot provide the necessary capacity to cope with the forecast demand." The report went on to recommend the provision of a metro from Tallaght to the airport, including Kimmage and Harold's Cross. How is it that nearly 20 years later, with a lower density of population then and significantly increased population now, with all that is planned for the coming years, the argument for that transport solution is not made and not sustainable now?
The metro group's straightforward argument is that buses alone cannot provide sufficient public transport capacity in Dublin South-West, and as a result, the south west will remain heavily reliant on cars, which will further damage the environment. On-street Luas is not feasible in this area, so the only way to provide the required capacity is with a metro. In other words, there is no alternative to a metro to meet the public transport needs of those living in Dublin South-West and that portion of Dublin South-Central. This analysis is supported by residents associations, their experience and canvassing of them. It is imperative that this position is reviewed and that the feasibility study is undertaken. With the passing of today's legislation, I strongly propose and urge the Minister that the metro south-west feasibility study is undertaken as one of the projects under the climate action fund, that the funding is designated for it, and that we take cognisance of the eminently sensible and reasonable terms of reference that are suggested and put forward by the south-west metro campaign.
I welcome the Minister, Deputy Ryan. This is not just an amended Bill. It is a statement of intent. We have a list of projects. If we can continue in that matter, actually to show the practical ramifications of the Bills that we have passed, that is the best way to get the public on board. We see a number of these projects dealing with climate in tandem with fuel poverty. Let us continue that and show that this is a Government and a House that is putting in place the practical measures that can change people's lives.
I welcome many of the suggestions here today which show that we are all on board with a climate action fund. On top of the measures outlined here, I am especially excited about that second round. With a climate action fund, and on top of the measures outlined here, I am particularly excited about the second round. As was highlighted earlier by Senator Murphy, today is the closing date for applications for the just transition fund. That gets people really excited. They can ask to put forward their innovative suggestions for how to deal with climate and how to help their community. When I look at some of the community energy projects that people have tried to get off the ground, such as in my own constituency of Galway, it has been incredibly difficult. I have tried to help communities to do that. I would love if the Minister addressed how we can make it easier for people to put these things into action. The Aran Islands Energy Co-op has been really successful but that took years of effort on the part of a dedicated group of people who live close together. Other things can be done, but people have found it difficult to use the Sustainable Energy Authority of Ireland grant scheme. It is fantastic that there is going to be a second round but I would love to hear more about how we can make it easier for people not only to access funding but also to get projects off the ground.
I thank the Minister for coming in and will not take any more time. I welcome the Bill and the amendments that the Minister has said he will look at further down the line. We are losing money every day that we fail to pass this legislation so we should pass it while taking on board all of the suggestions that have been made and working together across the two Houses of the Oireachtas.
I sincerely congratulate the Minister on his appointment. I had the privilege of joining Dáil Éireann in 2016 and one of the greatest working relationships I had was with him. I come from a rural community where people often say that the Minister does not care about them. He does care about people. If I am not mistaken, he has a strong association with County Tipperary. I assure the House that the Minister would speak to any rural community he was asked to. To be quite honest, I want to stop the sense of "us and them" about climate change in this country. I want specifically to say to the people of rural Ireland that it will not be an us-and-them situation. That is true from the perspectives of Fianna Fáil, the Green Party and Fine Gael. The Government will be fair and ensure that difficulties for rural communities will be addressed. We might have problems with emissions but substitutions will be put in place in order to lessen the burden of taxation on people. This matter affects both people in rural Ireland and, as Senator Fitzpatrick said, in urban areas. Let everybody from all political perspectives, whether that of Fianna Fáil, Fine Gael, Independent, Sinn Féin, the Labour Party or whatever, confirm that this is not a situation of us and them.
Decarbonisation is no longer a buzzword, it is a reality for every part of our society. How we achieve it and overcome difficulties will be challenging but those difficulties will not be overcome by creating us-and-them situations. Incorrect material is sometimes put out in order to frighten people.
Past Governments may not have lived up to the challenge of looking after people in fuel poverty as well as they should have but the need for supports for such people has always been acknowledged. The issue of fuel poverty, and the need to address it, is often mentioned in the programme for Government and within the three parties. We must look after people who may be challenged by increased taxes. That must be clearly dealt with.
Earlier today, I asked the Leader to suggest that, in the future, the Minister will come before us and specifically talk about my area, notwithstanding the fact that I know that the Minister has much work to do at the moment. The situation relating to Bord na Móna and just transition is shocking. The transition was to occur over an eight-year period but has happened virtually overnight. That has created a great challenge. I know that the Minister has taken a keen interest in the matter. The people of Shannonbridge, Ballinasloe, Lanesborough, Longford and Roscommon look forward to engaging on the matter. Let us come forward with jobs. All the better if they are green jobs. Bord na Móna and the ESB were the economic lifeline of our locality for 70 years and thousands of people relied on them. We all must acknowledge that change is coming rapidly but we must ensure that those communities are not left behind. I am sure the Minister agrees.It is a challenge that I recognise as such and it is one for everybody in this Chamber, if they are sincere about politics. Members of this House must not engage in "us and them" politics. We must not put fear into people about changes that must be made. We must help people along. I know the Minister will engage with communities and he will have my full support in whatever he does. Of course we will have challenges and differences of opinion but this is certainly a challenge we have to meet.
Rural communities should not be afraid. We will meet the challenges. We know there are issues with public transport. Rural areas do not have the public transport system that some urban areas have. We will have to rectify that. While LocalLink has come on board and more people now have access to that type of travel, it still does not solve the problem. Let us move forward. The establishment of the climate action fund is good. I look forward to many people in urban and rural areas putting forward suggestions and ideas for this fund.
Gabhaim buíochas, a Leas-Chathaoirligh. I dtús báire ba mhaith liom fáilte a chur roimh an Aire agus comhghairdeas a ghabháil leis as an bpost nua atá aige. Táim an-sásta é a fheiceáil sa Roinn Cumarsáide, Gníomhaithe ar son na hAeráide agus Comhshaoil agus tá a fhios agam go ndéanfaidh sé an-jab dúinn ag am atá an-tábhachtach ar fad dár gcomhshaol anseo.
I welcome this tremendously important Bill. If I have one criticism, it is that the Title disguises what the legislation is actually doing. I echo Senator Pauline O’Reilly's point that we are now embarking on a new phase in dealing with the climate action crisis. We are building on the work done by the previous Government and the provisions put in place in the last budget. Work was also done by the joint Oireachtas committee on increasing the carbon tax in acknowledgment that this is an expensive problem which can only be solved with the contribution of the economy. The suggestion is that we are merely amending the National Oil Reserves Agency Act, although I accept the Title says more than that. That suggestion takes away from the impetus the Bill gives the Government and the State to deal with the issue that arises.
I also agree with Senator Higgins that the National Oil Reserves Agency Act 2007 was passed in a totally different time. Attitudes were completely different, as were the economic situation and the approach to carbon fuels. Perhaps the name of the agency should be changed to refer to the national energy reserves agency because it must go beyond safeguarding access to carbon fuels and ensuring Ireland’s energy security.
To respond to Senator Moynihan’s comments about electric cars, in the context of energy security one of the great aspects of having a greater fleet of electric cars is that it also creates a reserve for electricity generated through wind power, for example. While I agree with the Senator's point on the danger of merely replacing current cars with electric cars, that would have a major benefit and not only in reducing emissions. If we are to move towards renewable forms of energy generation by increasing wind and wave power, that does not stop when night falls and cars come off the road. Energy generated overnight can be stored in the batteries of those cars in the driveways of houses and the car parks of apartment blocks. That is a very important feature of having a fleet of electric cars. Energy generated overnight is stored in those cars and used again during the day in circumstances where we as a nation do not have the capacity to absorb the renewable energy generated overnight because we do not have batteries large enough to do so. To say we should simply not invest in electric cars is slightly short-sighted because it does not acknowledge the important role these vehicles have in providing a battery for the State.
To respond to Senator Boylan's comments on aviation fuel, it is important to recognise that the Bill does not have a role in this regard. I do not dispute that there are major issues with aviation fuel and emissions but we must also recognise that, as an island nation, we are very dependent on aviation in a way that our continental colleagues in Europe are not. We have to be very careful about being the cheerleaders for measures on aviation fuel that will make the provision of goods on this island much more expensive, which would have a massive knock-on economic effect. We must think about that very carefully. I want to address some of the issues in the Bill, specifically the provision in terms of commencement. I know that when the 2007 Act passed, it was commenced almost immediately, but this is emergency legislation and is going through this House in what can fairly be described as a rushed fashion. Other Senators have expressed reservations in recent weeks about the fact that we are going through all Stages of the Bill and I agree with that, but I also recognise the urgency of this provision. Will the Minister confirm that these provisions will be commenced almost immediately? The power is in the Minister's hands and I would be anxious that there would not be any delay in commencing them. In passing this Bill, the Oireachtas is handing that power over to the Minister rather than requiring that it would commence on its passing.
The Bill has been described as technical. There is an awful lot of amendment in it, and the Bill, apart from the newly inserted sections such as 37A and 37B etc., is mostly amending the principal Act. I wonder if there is room, as we move into this new phase that has already been described, to talk about having consolidating legislation in this regard. It is difficult for the ordinary person to access a document like this, which is long but essentially refers to another document. I wonder if consideration will be given in the future, given that the 2007 Act has already been amended twice, to more consolidated legislation that would make it clear for people.
On section 15, which creates a new section 37B, there is a provision in subsection 6 of that for financial accounts from the fund, as well as a report from the Comptroller and Auditor General on same, to be laid before each House of the Oireachtas, and I welcome that. Would there also be room for the Minister to provide a report on the expenditure and operation of the climate action fund to give greater clarity and transparency to Members and the public in respect of how this money is generated and spent?
I welcome the Minister to the House and I congratulate him on his elevation. We will miss him in the corridors of LH2000. I agree with the speakers who have said the Title of this legislation is somewhat confusing to the ordinary individual and I support Senator Ward in his suggestion regarding the need for consolidated legislation in the not-too-distant future.
There is a lot of talk about retrofitting, particularly when we look towards the Bord na Móna workers and their like. I walk around south Dublin and I watch new developments and I have to congratulate the construction industry on the way in which it has tried to build houses that are more green and eco-friendly etc. On retrofitting, I was recently talking to a relative of mine and I told him I was thinking of changing my windows again. The response I got was that at my age I might as well leave it for the next guy. When we thinks about the costs involved for the people who desperately need to retrofit their properties, it must be remembered that, by and large, they are in the more elderly age group in the country.
It struck me when I visited Finland a couple of years ago that the further education and training sector is actively involved in the community and in work such as retrofitting. As a former trade unionist, I realise this would cause problems, but there may be scope to bring in something like the old FÁS projects from years ago, in which community work was done by trainees under the auspices of FÁS, with respect to retrofitting houses for the elderly. The costs involved are prohibitive and they simply could not afford to do it otherwise, so why should they be left out of the loop when it comes to retrofitting their properties? I ask the Minister to engage with his colleague, the Minister for Education and Skills, to see if there is a way we could bring education and training into the area of retrofitting properties and making them more eco-friendly.
There is a lot of talk about electric cars, both in this House and outside of this House. I am 100% supportive of this but I want us to be a little bit more realistic about the human cost of some of the raw materials that are required in the building of electric vehicles and I want us to be honest about the carbon footprint from the manufacture of an electric car. I have heard estimates that suggest it takes up to ten years to write off the carbon footprint for the manufacturing process involved in an electric car.Very few people in this country have cars that are more than ten years old. Those who do will be levied by an insurance company because their cars are too old. We need a more honest debate about replacing petrol or diesel vehicles with electric vehicles. I am not saying it should not be done. I am 100% supportive of it. However, we have to be more honest about the actual costs, both in human and ecological terms.
The Minister will be aware that last year I took to two wheels and cycled around Dublin to try it out for myself. I had not sat on a bicycle for perhaps 50 years. The experience of travelling around Dublin was horrific. In recent days I have seen experienced cyclists bringing their young children onto the roads on bicycles. One of the interesting things I saw over the last few days was a cycleway where young novice cyclists were brought by their parents to experience cycling and become competent in it, only to find that it was a racetrack for more competent cyclists. I am not sure what we can do about that other than consider changes to by-laws. We can at least state in this House that cycleways are for people to travel in a normal cycling capacity. They are not raceways. People who want to race fellow cyclists should find a track somewhere or get out on the main road. For God's sake, young children and novice cyclists should not be put in danger by people racing down cycleways that were not constructed for that purpose.
The cycle to work scheme must be extended and electric bicycles must be included for more elderly persons such as myself. My legs are still reeling from the two days I spent on a bicycle. It would have been nice for my bicycle to have been assisted by electrical power. We need to look at how we can offer more grant aid or subvention to get more and more people on bicycles. That will fall into the Minister's remit and I know he will be 100% committed to it. I wish the Minister well in his portfolio. I hope he brings the educational issue I spoke of to the relevant Minister.
I would like to congratulate the Minister on his appointment and welcome him to the Chamber. I broadly welcome the National Oil Reserves Agency (Amendment) and Provision of Central Treasury Services Bill 2020. It was legislation which featured regularly at the legislative meetings which I chaired in my previous role but was subject to continued delays and requirements for legal advice. I welcome the fact that it is finally before the Houses. As we have heard, the Bill puts the climate action fund on a statutory footing. The fund is one of four set up under the national development plan in 2018. I know the importance of designated funds with specific aims and objectives. When I was a Minister of State at the Department of Rural and Community Development I put forward the idea for a fund that was to become the rural regeneration and development fund with the support of the Minister, Deputy Ring. For several years, there was no suitable fund to support and progress larger projects with the potential to transform communities and implement positive changes. The rural regeneration and development fund solved that problem, just as the climate action fund is an important part of the solution to the major challenges of climate change. As others have said, I would like to see it grow and develop over the years and form part of mainstream funding rather than being confined to levies.
The projects supported by €77 million under the first round of the climate action fund will be varied and will help our country to transition to a low-carbon future. The projects, which include the ESB electric vehicle charging infrastructure project, the Iarnród Éireann hybrid fleet project and the local authority public lighting energy-efficiency project, were all practical choices.
Cé go bhfáiltím roimh an mBille um an nGníomhaireacht Chúltaca Ola Náisiúnta (Leasú) agus um Sholáthar Seirbhísí Lárnacha Cisteáin 2020 go ginearálta, tá roinnt imní orm. Suas go deich mbliana ó shin, bhí ciste suntasach ag an nGníomhaireacht Chúltaca Ola Náisiúnta, suas le €440 milliún. Ós rud é go ndéanfar an ciste a mhaoiniú, is cúis imní é inmharthanacht an chiste agus muid ag bogadh ó úsáid táirgí ola.
Cúis imní eile dom ná tionchar cuid de na bearta gníomhaíochta aeráide eile ar theaghlaigh, ar chomhlachtaí agus ar phobail lasmuigh de Bhaile Átha Cliath agus na cathracha móra. Rachaidh bearta mar théamh ceantair agus iompar poiblí ar scála mór chun leas na cathracha. Tá níos lú roghanna dúinn sna bailte beaga, sráidbhailte agus pobail tuaithe.Ní mór dúinn a chinntiú go mbeidh na bearta gníomhaíochta aeráide leathan ionas go mbeidh gach teaghlach agus pobal inár dtír in ann leas a bhaint astu. Ní féidir pionóis a ghearradh ar theaghlaigh ná ar ghnólachtaí as leanúint ar aghaidh ag úsáid fhoinse breosla atá ann cheana féin le haghaidh fuinnimh agus iompair toisc nach bhfuil aon roghanna eile réidh ná forbartha i gceart.
Tá dóchas agam, áfach, gur féidir foinse fuinnimh in-athnuaite agus bearta eile a thabhairt isteach agus go n-éireoidh leo i bpobail tuaithe nó iargúlta. Is samplaí iontacha iad Oileán Árainn agus an chaoi ina mbaineann an pobal áitiúil an-úsáid as tionscnaimh mar an scéim phobail fuinnimh níos fearr.
I have a concern over the proposed Committee Stage amendment to section 15 removing the obligation to conduct a competitive project selection process. Instead, the Minister, or such other person as he or she may nominate, will be empowered to invite proposals to receive funding from the NORA fund. We need to be very careful in terms of transparency and fairness. I ask the Minister to clarify how the projects will be upheld with regard to the selection of projects and initiatives.
Section 15 requires the Minister to consult the Minister for Public Expenditure and Reform on the guidelines on the funding of projects. As my party's spokesperson on public expenditure and reform in the Seanad, I will be taking a keen interest in the selection of projects and the use of the NORA fund.
The programme for Government is rightly ambitious on climate action. The Government and the Houses of the Oireachtas need to lead in this area. I cannot emphasise enough the need to ensure that climate action measures are fair, realistic, viable and, above all, will help citizens and communities on our journey to a low-carbon economy and society.
On numerous occasions, I have highlighted the progressive increases in carbon tax and ring-fencing these for rural areas and public transport. If we are to reduce dependency on and usage of private cars, we need to provide alternatives for those rural communities. We need to provide extra bus routes and increase the frequency of services. Without that, as prices of petrol and diesel continue to increase, it will create a tension we do not want. We do not want to create a tension in rural communities which are dependent on private cars if we do not have an alternative in place. I recognise that challenge. As carbon tax increases in the future, we need to ensure part of that is ring-fenced for additional bus routes and increased frequency of service.
I appreciate the opportunity to engage with the Minister on this Bill. I know it has a long name and we refer to it as NORA, but what we are really discussing are the benefits of the climate action fund, the projects that have been approved and potential projects. As previous speakers acknowledged, we are all working towards a transition to a low-carbon economy, while reaping the benefits of that from the point of view of quality of life, work-life balance, the provision of a just transition and secure employment, and climate action in biodiversity.
I have some questions for the Minister. Can the climate action fund be used to develop an ecosystem around remote working? We have a real opportunity at the moment to change the model of how we work and move away from what has gone before in terms of getting up in the morning, commuting into town and coming home. We have an opportunity to bring everything more towards communities by developing community infrastructure around remote work and making a more sophisticated network of co-working spaces.
We frequently talk about the benefits for rural areas from this. We do not necessarily focus on the benefits for suburban life. I live in the constituency of Dublin West. I have always felt there is a great opportunity there in terms of the pressure on our public transport and the pressures parents and commuters feel. In the long term it is about changing the model of how we work and investing in community infrastructure around that. Does the climate action fund have potential to drive that forward?
I want to ask about start-ups. We have rightly spent much time in the House talking about SMEs. Is there potential for start-ups in the climate action fund? Obviously, innovators have also been hit by Covid.It is not necessarily through jobs yet but it is the time and investment they put into their projects. We have to make sure that the opportunities still exist for them because we need them in this transition to a low-carbon economy and the future of the country.
The third question, which other Members raised so I will not labour it, is the potential for apprenticeships and reskilling within this project.
I welcome the Minister to the Chamber and wish him well in his brief. I welcome the Bill and the increased funding for the climate action fund.
I come from Longford, one of the areas that has been hit with the closure of the plant in Lanesborough. Thousands of people in our area relied on jobs from Bord na Móna and the ESB over the past number of decades. We were hit with a hammer blow by the decision by An Bord Pleanála to turn down the ESB's application, and it has brought forward massive changes in our community. A local collaborative group has been working for the past number of years to try to bring forward plans for alternative jobs in our area. I ask that we would be prioritised as an area, along with Offaly, as the area that is most affected and has the largest number of job losses because of these changes with the ESB and Bord na Móna.
I ask the Minister to also examine the planning conditions for those plants, which means that they must be decommissioned and taken down. I ask that that would be stalled to allow the groups to examine alternatives for the use of the power stations as they currently exist. That is a priority that must be dealt with straight away. We must prioritise these areas for funding, as they are the areas most affected by job losses because of just transition.
I ask also that we would promote the development of the mid-Shannon wilderness park. Our local authority in Longford and the county tourism committee has been working towards developing a natural park in the 20,000 acres of bogland in that part of County Longford.
I ask the Minister to look at those issues. I ask him for his support, and I invite him to come to County Longford to meet the people on the ground in Bord na Móna and ESB who are losing their jobs.
I very much appreciate the contributions by all the Senators. I will try to reflect on some of the questions, answer them if I can and comment on some of the contributions. I will start with Senator Fitzpatrick who was right in stating that a key in this transition is the health benefits that accrue from the decarbonisation. In terms of the analysis that has been done, for example, in retrofitting, the Senator is right, in that the effects on asthma and lung disease are dramatic. There are huge co-benefits from making this transition.
I want to reassure Senator Higgins, and agree with her, that this fund is only a small part relative to the jigsaw we will have to put in place to make this transition work. It is one fund. It tends towards innovation, experimentation and new technologies that might not make the commercial yardstick but which, by advancing them might give us the scale or the experience to allow them to become much more common. To answer the Senator's question, under section 15 and the proposed new section 37B(8), there is the mechanism, as she suggested, to allow other European or Exchequer funds to go into the fund. It could be added to not just from the levy but from other sources. That is very much required.
I agree with Senator Boylan on the need for aviation taxes and in respect of shipping. That has to be handled at an international and European level. She will be aware of the task involved in that. We are closer to it in Europe than people had thought. It may be delayed somewhat by the Covid-19 crisis because the aviation industry is in such a downturn but I agree with her that we should be looking at that mechanism. Also, with regard to front-loading of investment, the way this is structured there is a front-loading in the fund in the sense that the National Oil Reserves Agency has a remaining cash pile, as it were, of approximately €200 million.That will be used by the National Oil Reserves Agency in the first few years if it has to buy any additional stocks for us to meet our international obligations under European Union and International Energy Agency agreements. This means that the vast majority of levies collected over the coming years will go into the fund, which can then be disbursed.
The spending of the fund is not a function of availability but of how quickly projects can get up and running. I will provide an example. I agree with and appreciate Senator Moynihan's comments regarding our colleagues on Dublin City Council. An example of a project for which funding has already been agreed is the district heating scheme in Dublin, towards which €20 million has been allocated. In truth, we have not seen this project advance as quickly as I would have liked. The same could be said of a whole variety of projects. Dublin City Council will really need to provide resources to match this funding to progress this project and perhaps even to think more ambitiously about how it and district heating generally might work. It may be the case that it could be extended further rather than being limited to its current scale.
I absolutely agree with Senator Hoey. This must be a just transition and we must prioritise measures that result in social progress and address fuel poverty and inequality.
I could not agree more with Senator Seery Kearney. Her analysis of the history of the bus service in the areas she referred to was very interesting. I would go even further back. The very first rail service came from that south west direction and into the city. It was initially drawn by horse and cart. That need has always been there and it is a strategic objective. As much as I agree with the project, it will not be provided for under this fund. It must be investigated in the first instance by the National Transport Authority. The options must be examined, including the options of running south east along the existing line and of running south west. That is the appropriate way to progress. This fund cannot be used to fund all the projects we might want to fund. I do not disagree with the Senator's analysis that running MetroLink further than the currently envisaged end point is absolutely necessary.
I thank Senator Pauline O'Reilly for her comments. If one was to take any of the Aran Islands as an example, Inis Mór is a good choice. It shows a variety of things, including that things take time, that mistakes are often made along the way, and that things can stop and start again. That Aran Islands project is, however, as good as any. It is very measurable because one can measure the fuel going out to an island. This fund is similar in a sense. One of the amendments to whose purpose I signalled I hoped to come back, in the name of Deputy Whitmore, specifically targeted community resilience projects of that nature. While it is not provided for in the Bill, I agreed with the Deputy that we would come back to the idea of specifically targeting community-led community resilience projects in a later Bill, possibly the climate action fund Bill. The project on the Aran Islands was one of the first and is still a very good example.
I regret that Senator Murphy is no longer in the Chamber as I wished to thank him for his kind words. I could not agree with him more; it cannot be a case of us and them. As I told Deputy Healy-Rae during yesterday's debate in the Dáil, this will be good for rural Ireland, including Roscommon and Longford. It has to be. Many of these energy projects will be located in rural Ireland. It is hard to site an energy project in my constituency because of the density of the urban environment. They can be sited in rural Ireland, however. I absolutely agree with the Senator that this cannot be a case of them and us.
To answer Senator Ward's point, the reason we are progressing at this unseemly speed - I would prefer it to be done in the ordinary time - is that if we can get it passed today and then passed in the Dáil next week, we can get it to the President straight away. It will fly out to the Phoenix Park. We aim to commence the Act on 1 August. That allows a contribution of €10 million for that month to go straight into the fund. I was talking about front-loading. A sum of €10 million is not small. That is why we are putting this Bill through over such a short period.
I hope Senator Craughwell will be out on his bike a lot more often in light of some of the measures introduced with regard to Covid-19.Senator Currie also asked whether we could use the opportunity Covid-19 presents to change the transport system or the remote working system. These are different pieces of the jigsaw to be solved somewhere else. This is really about energy efficiency rather than transport or remote working. They fit into the national economic plan and that is where we need to do it.
I thank Senator McGahon for the kind words about Mark Dearey and my colleagues in Dundalk. The Senator got it right in terms of focusing on energy efficiency and the lighting scheme in the local authority. Energy efficiency has to come first. The metaphor I always use is that we put the plug in the bath before we fill it. That is not very exciting; it will hardly give us a politician up a pole cutting a ribbon on an LED light bulb but that scale of innovative new thinking is what we should be looking for.
I reassure Senator Kyne that the reason for the amendment, as we will come to in the discussions, is to recognise that there will be some instances where there will not be competitive tendering. In the vast majority of cases we want a competitive tendering process so it will not be about political favours. However, there are certain projects, such as bog rehabilitation, where there is not a market. For a specific bog rehabilitation process where there cannot be, by definition, competition, we want a mechanism. It will not be done through competitive tendering but there will be a call for a specific project to be advanced. This is what the amendment is there to allow. In particular, it recognises that the midlands is where we have to do the just transition first.
To go beyond this, Bord na Móna going from brown to green is a real possibility for the company. The question being asked locally is the correct one, with regard to what we will do with the power stations. They have grid connection links and Bord na Móna has real expertise in energy. Perhaps this can be deployed in a new hydrogen economy. Certainly, it should be applied in the renewable economy. Bord na Móna will start doing this as well as bog rehabilitation. I look forward to visiting Senator Carrigy in Longford.
This fund is designed for thinking outside the box about new sustainable ways of using some of these facilities. These could be quite small. It could be a series of small things such as community projects. It could also be big and really outside the box. There is no limit in terms of the applications so people should think big. If a project really starts to make sense we will be able to draw down funding from Europe as well as from this levy or, indeed, we could go to the Exchequer to look for further funding. This is what the levy should trigger. It is only one piece in a series of legislation that we will need.
I think I heard Senator Boylan speak yesterday about the climate action committee. To my mind, it will be critical in contributing. I worked with Senator Higgins on that committee for many years and it was a very good committee. It is through that committee, with Senators, that we should be working together to see how we deploy the fund.