Brendan Griffin (Kerry, Fine Gael)
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216. To ask the Minister for Finance if he will provide clarification on the rising costs of fuel oil and coal (details supplied); and if he will make a statement on the matter. [25199/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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The final retail price of fuel is determined by a number of factors which include the costs of production, distribution, global market factors, international exchange rates, taxation, wholesale market contracts as well as individual retail pricing policies.

2020 saw historic lows in oil markets in light of the fall off in demand caused by Covid-19 lockdown measures. According to energy market analysis by the International Energy Agency (IEA), supply constraint measures taken by the industry, in combination with re-opening of major economies, widespread fiscal stimulus responses, as well as optimism surrounding the roll out of vaccines, has supported a rebound in demand and upward price movement in the oil market. IEA analysis also points to restricted production and increased costs in light of Covid-19 health protection measures in 2020, as well as increased demand for coal as a fuel input in power production in China and unusually cold conditions in North America and Europe in early 2021 contributing to increased retail prices in coal.

Petrol and auto diesel are subject to Mineral Oil Tax which comprises a carbon charge and a non carbon charge, as well as VAT at the standard rate and the NORA levy of 2 cents per litre. The non carbon charge and NORA levy have not been increased since 2012 and 2009 respectively. In line with this Government’s commitment to tackling climate change as set out in the Programme for Government and the Climate Action Plan, Budget 2021 increased the rate of carbon tax from €26 per tonne of carbon dioxide emission to €33.50. The increase applied to transport fuels with effect from 14th October 2020 but I delayed its application to all other fuels until 1st May 2021 to allow for the passage of the winter heating season.

The impact of the carbon tax increase on the most commonly used fuels is shown in the table below.

*Average annual household usage as per the Commission for Regulation of Utilities

From September 2020 until 1^stMarch 2021 auto fuels benefitted from a reduction in the standard rate of VAT from 23% to 21% which I announced as part of the July stimulus plan. On the basis of March 2021 average retail auto fuel prices, the return to the 23% Standard rate of VAT comprised approximately 2 cents per litre. According to the monthly AA Fuel Price Survey, the average retail price of both petrol and diesel increased by approximately 16 and 15 cents respectively between October 2020 and April 2021.

With reference to smokeless coal, Solid Fuel Carbon Tax legislation does not set out separate definitions and rates for ‘smokeless coal’ and ‘regular coal’. I understand that distinctions between regular and smokeless coal are made in the regulatory regime for environmental standards of solid fuel that is overseen by the Department of Communications, Climate Action and Environment which is enforced by local authorities in areas that are designated for use of certain types of solid fuel under air pollution legislation. This is a separate legal and regulatory regime and is not linked to the rates of Solid Fuel Carbon Tax, which is based on the amount of CO2 emitted by a given solid fuel product.

My advice to consumers is to shop around and if possible use price comparison websites to ensure they receive the best value for money.

If an individual believes that a breach of their consumer rights has occurred, they may make a complaint directly to the business concerned. The Competition and Consumer Protection Commission (CCPC) is the statutory independent body responsible for the promotion of consumer rights and the enforcement of consumer law. The CCPC provides advice and guidelines on the process of making a complaint. Full information is available at: www.ccpc.ie