Róisín Shortall (Dublin North West, Social Democrats)
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270. To ask the Minister for Communications, Energy and Natural Resources his views on the potential inclusion of fossil fuel divestment amongst the recommendation to the autumn review of the Ireland Strategic Investment Fund's strategy; the steps he is taking to ensure the terms of the Paris agreement are met; and if he will make a statement on the matter. [31231/16]

Denis Naughten (Roscommon-Galway, Independent)
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The issue of fossil fuel divestment in Ireland's upcoming review of the Ireland Strategic Investment Fund, the ISIF, was recently discussed by my colleague, Minister Noonan T.D. in response to Parliamentary Questions from Deputies Pringle and Daly.

As Minister Noonan outlined, the ISIF is committed to reviewing its investment strategy after 18 months of operation. This review, which will be completed in Q4 2016, addresses the issues of decarbonisation and Ireland's long term transition towards a low carbon economy. ISIF shareholdings with fossil fuel exposure include certain investments inherited from its predecessor the National Pension Reserve Fund (NPRF).

These particular shareholdings are in companies based outside Ireland and, as such, are held in ISIF's global portfolio. This portfolio has been restructured and is being sold over time to fund Irish investment commitments as they arise, in keeping with ISIF's mandate to invest, on a commercial basis to support economic activity and employment, in Ireland.

ISIF's total equity holdings in the Energy sector are valued at €11 million (0.14% of ISIF's assets under management). ISIF has also invested in circa. €97 million of short term fixed income investments in energy corporations, representing just over 1% of ISIF's assets.

As part of its on-going commitment to operate to high international standards ISIF has recently published its Sustainability and Responsible Investment Policy which is available online at: 

The Sustainable and Responsible Investment Policy emphasises climate change as part of the investment decision making process. Many major funds internationally have made significant divestments from fossil fuels such as coal, while other such funds have adopted an approach of engagement with energy companies to establish their strategy and positioning for the transition to a low carbon economy. ISIF continually reviews its carbon exposure and the investment case for companies that may not be aligned with the long term transition to a low-carbon economy.

The issues of decarbonisation and the long term transition towards a low carbon economy are central to the Paris Agreement to the UNFCCC, which was agreed by over 195 countries and Parties at COP21 in 2015 and will enter into force on 4 November 2016. The Dáil debate to progress Ireland’s ratification of the Paris Agreement is scheduled for 27 October.

The Paris Agreement aims to tackle 95% of global emissions through 188 Intended Nationally Determined Contributions (INDCs). Ireland will contribute to the Paris Agreement via the INDC tabled by the EU which commits to 40% reduction in greenhouse gas emissions by 2030 compared to 1990. The specific details of the contribution to be made by each Member State to this overall ambition remain to be finalised, and Ireland is currently examining proposals made by the European Commission in this regard. The Paris Agreement also provides that developed country Parties shall provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention. To date, Ireland’s contributions of climate finance to developing countries has been Exchequer funded primarily through climate oriented spending via the Official Development Assistance Vote and separate contributions to the Green Climate Fund (GCF) which will initiate later this year.