Billy Kelleher (Cork North Central, Fianna Fail)
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Question 54: To ask the Minister for Communications, Energy and Natural Resources his views that the reduction in grants available under the better homes scheme will stimulate employment and further encourage persons to avail of these grants; and if he will make a statement on the matter. [15943/11]

Pat Rabbitte (Dublin South West, Labour)
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I announced the launch of Better Energy: The National Upgrade Programme in early May in the context of the Government's Jobs Initiative. Better Energy is replacing the three existing energy efficiency and renewable energy programmes: the Home Energy Savings Scheme, the Warmer Homes Scheme and the Greener Homes Scheme.

The Better Energy grant levels have been set to ensure that the level of Exchequer support is in line with market prices. The grant levels represent approximately 30% of the cost of each efficiency measure supported under the Programme. Since the Home Energy Saving scheme was launched in 2009, there have been considerable reductions in the market prices being charged for most of the efficiency measures covered by the scheme. The exception at this stage is external insulation which is a relatively new technology in the Irish Market. It is self evident that the level of Exchequer support should reflect actual market prices.

Measures being supported under the Better Energy programme are those designed to deliver the greatest energy savings, thus maximising the value achieved from the Exchequer allocation. The additional €30 million provided to the Programme for 2011 under the Jobs Initiative will be matched by a further €30 million in private sector investment. It will therefore help to generate further economic activity of at least €60 million this year.

One of the key objectives of the Better Energy programme is to support the construction sector and the delivery by the sector of quality installations in line with best practice. The level of take-up and activity under the domestic retrofitting schemes to date is demonstrably supporting jobs, given the labour intensive nature of energy efficiency upgrades. The Sustainable Energy Authority of Ireland (SEAI) advises that over 5,800 full time jobs are projected to be supported in 2011. This represents an increase of some 2000 jobs this year over the 3,800 jobs already being supported under the Schemes.

SEAI also advises that the number of applicants has remained steady since the launch of the Better Energy Programme last month. This underlines the continued strong interest of householders in the home energy savings scheme.

My Department is also working to transform the way in which upgrades are funded with the aim of making participation even more affordable for householders. The first step will be by offering the grants as upfront discounts, followed by a move to a pay-as-you-save model.

Pay-as-you-save is a financial model which would allow energy consumers to finance energy efficiency upgrades through the energy savings generated. The Programme for Government commits to the roll out of a pay-as-you-save scheme after 2013. This will enable the home energy efficiency programme to continue without recourse to public funding. It is also in line with developments at EU level.

There are considerable complexities involved in the development of an effective pay-as-you-save model. My Department is working with the utilities, the energy sector, as a whole, and financial institutions to develop an appropriate model. I expect to bring proposals to Government to underpin the scheme towards the end of the year.