Mixed reception to energy and sustainables measures
Irish Solar Energy Association CEO Conall Bolger welcomed the Government's support for people installing rooftop solar panels but criticised the lack of such incentives for farmers. File picture
There will be three more energy bill credits for Irish households worth €150 each over winter, tax breaks for those selling electricity back to the grid, and the zero Vat rate on solar panels will be extended to schools.
Increases in the carbon tax mean motorists will be paying 3c more on petrol and diesel from today, Wednesday, but the increases in excise due at the end of the month — 8c on petrol and 6c on diesel — have been postponed and will be reintroduced in instalments in April and August 2024.
Some €380m is provided for retrofitting, an increase of €24m on last year, with additional funding from the European Regional Development Fund.
However, the number of extra homes that will be retrofitted next year will not be known until the coming weeks. The retrofitting fund comes entirely from the carbon tax.
The tax disregard in respect of personal income earned by households that sell residual electricity from microgeneration back to the national grid will be doubled on January 1, while the 0% Vat rate for solar equipment is now extended to schools as well as homes.
The various measures were met with a mixed reaction from industry, environmental, consumer, and social justice groups.
Taxback consumer tax expert Marian Ryan said the budget was a “damp squib” in many respects.
She said: “Households will be disappointed to learn that they are only entitled to €450 worth of energy credits, compared to the €600 worth of energy credits granted under Budget 2023.
“Energy bills have skyrocketed — yet recent figures show that wholesale electricity prices fell by 64% in the 12 months to July 2023.
“With some pressure from the Government, energy providers are in the process of finally passing on some savings to their customers.
“However, electricity prices in Ireland are still the highest in Europe and almost double the European average.”
Solar energy supporters were also mixed in their reaction.
Irish Solar Energy Association CEO Conall Bolger said the Government has done a lot to support homes to invest in rooftop solar panels.
“In addition, the extension of the 0% Vat rate for solar equipment purchased by schools is a sensible measure.”
However, he criticised the lack of incentives for farmers when it comes to solar power.
“Central to Ireland’s decarbonisation plan is the Government’s own stated ambition to develop 8GW of solar energy by 2030.
“This will require approximately 25,000 acres of solar farms within this decade and making this a reality will require the co-operation of farmers across the country.
“All farming families are conscious of tax exemptions to allow land to be passed on to the next generation without punitive tax bills.
"Inexplicably, this does not apply in instances where more than 50% of land is utilised by solar panels.
“We had expected the Government to remove this arbitrary rule that punishes farmers who engage in renewables and is significantly reducing the availability of land for solar,” he said.
Environment Minister Eamon Ryan said the ringfenced funding for retrofitting and social protection was a sign that the carbon tax is “really working”.
“What is really striking home now is that the mechanisms we put in place for the carbon tax is really working,” he said. “It goes up outside of the budget process, it’s not part of the big row... it’s coming with a legal certainty.”
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