Pa Daly (Kerry, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

81. To ask the Minister for Finance if he will report on the climate change risk matrix; if his Department has carried out any analysis of the financial impact of missing our 2030 targets on the Irish economy; and if he will make a statement on the matter. [16099/25]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The climate change risk matrix recently published on the Department of Finance website provides a framework or high level overview of how climate change physical and transitional risks are interlinked to the economy and financial system through a range of transmission channels. This framework is part of work that my Department is conducting to model and refine our understanding of climate-related economic, fiscal and financial related risks, and is in line with the requirement set out in the Programme for Government that all Departments should make climate action a core pillar of their new strategies.

To take into account the Government’s commitment to address the risks posed by climate change as published in successive national climate action plans, my Department is committed to developing fiscal and financial policies to support the Government’s policy on climate action and Climate Finance, participating in relevant domestic and international work streams to advance consideration of the economic, fiscal and financial aspects of climate action and to develop and enhance Ireland’s sustainable financial services policy.

With regard to the potential costs associated with Ireland’s EU climate and energy 2030 targets, the main objective of Government policy has been, and continues to be, achieving compliance with our targets through reducing emissions and increasing renewable energy generation. The agreed Programme for Government restates our determination that Ireland, together with our EU partners, will play its full part in tackling climate change. The Environmental Protection Agency has shown that emissions reductions are being made with Ireland’s greenhouse gas emissions decreasing for the last three years. However, we in Government also acknowledge that there is an imperative to go further – taking climate action faster and at scale, particularly over the next five years.

I note the recent report from the Irish Fiscal Advisory Council and the Climate Change Advisory Council highlighting the potential compliance cost implications of climate change and emissions reductions targets for Ireland. Similar analysis is being undertaken across Government in this area, and my officials are engaged with others on this work. It must be acknowledged however that there is considerable uncertainty around the emissions figures, and that specifying any cost figure is simply speculative at this stage.

Work is ongoing across Government to minimise any need to purchase compliance – by continuing to drive forward implementation of our Climate Action Plan, as we agree it is better to invest in climate action to improve people’s lives, build our energy independence and reduce our emissions, rather than transferring money elsewhere to purchase compliance. The Climate Action Plan sets out a range of actions to accelerate emissions reductions across all sectors and help avoid costs from purchasing compliance.