Carbon taxes on fossil fuels such as oil, gas and coal could reach up to €265 per tonne in the next 30 years, Climate Action Minister Richard Bruton has warned. By then, Ireland aims to be a low-carbon, or no-carbon society, but any individual or enterprise still relying on fossil fuels will face hefty charges.
Already, carbon taxes are intended to quadruple between now and 2030 rising from the current level of €20 per tonne to €80 per tonne. The first significant increase is likely to be approved in this autumn’s budget.
Mr Bruton said the further increases were based on forecasts from the Department of Public Expenditure and Reform.
“It has set a trajectory that it should be pricing carbon at €265 a tonne in 2050,” he said.
“The Government hasn’t made any decisions in relation to the trajectory of carbon price beyond 2030 but it does illustrate the direction of travel that a department like Public Expenditure and Reform is predicting for the price of carbon in the longer term, reflecting the damage that it does to our environment,” he said.
The Climate Action Minister said he could not predict the extent of the increase to be levied next year. Mr Bruton said that the Minister for Finance Paschal Donohoe would be listening to the views of a wide range of interests, not only on the scale of the increase but how the proceeds should be used.
Broad agreement on a fourfold increase in carbon taxes was reached by the all-party Committee on Climate Action last month but some of the smaller parties are opposed, and there is concern about the impact the tax has on low- income households and those least able to afford to refit their homes to run on renewable energy.
Mr Bruton confirmedIreland will only achieve a 1% reduction in carbon emissions by next year, compared to the 20% reduction required under EU targets. Failure to meet the target has meant buying carbon credits to make up the shortfall which he said had so far cost the country €100 to €150m.
“It’s something we shouldn’t be doing and those penalties will escalate dramatically in the years ahead if we continue to fail,” he said.
“So my determination is that we get back on track, that we hit our targets for 2030 and that we do it having delivered the carbon abatement, not purchasing in the market to cover for the fact that we failed to deliver the targets we set.”
Mr Bruton was speaking at the Environmental Protection Agency’s inaugural Climate Action Conference in Dublin.
Ireland will fall short of EU2020 targets for renewable energy use, the Sustainable Energy Authority of Ireland says.
Around 13% of the country’s energy needs for electricity, heat and transport will come from renewable sources by next year. That is up from 5% in 2005 and the equivalent of taking 1.6m cars off the road. However, it is below the 16% required by the EU.
The country’s performance is particularly poor on renewable heat. Our 2020 target is for 12% of heat to come from renewables but it is likely to be 8% to 9%. We are getting close to the 40% target for renewable electricity. It should reach 37% by year’s end and we will probably meet the 10% transport target but only by relying on the much criticised ‘multiplier effect’ which allows extra credit for using biofuels.
The law requires transport fuels to contain a small proportion of biofuels but the multiplier effect overstates a country’s green credentials when a switch to electric vehicles is the preferred option.
SEAI confirmed Ireland’s overall greenhouse gas emissions fell 1.8% in 2018 but cautions this was due to a prolonged outage at the ESB’s Moneypoint power plant which resulted in 32% less coal being used during the year. Coal accounted for 5.2% of the country’s energy use last year compared to 7.6% in 2017. Oil use increased by 1% during the year — a significant addition to carbon emissions as oil accounted for 48% of total energy use.