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knowledge 8 July 2020 |

The Programme for Government and Energy

The Programme for Government agreed between Fianna Fáil, Fine Gael and Green Party negotiators on 15 June 2020 was ratified on Friday, 26 June 2020. Climate concerns flavour each of the policies which are now firmly on the agenda of the newly formed Government. In this briefing we highlight the key policies proposed for the energy sector.

What is in the Programme for Government?

On Saturday, 27 June the President appointed the new members of the Government. The new appointees will now be tasked with progressing the twelve core missions outlined in the Programme for Government and listed below.

  1. A Better Quality of Life for All;
  2. Reigniting and Renewing the Economy;
  3. A Green New Deal;
  4. Universal Healthcare;
  5. Housing for All;
  6. Balanced Regional Development;
  7. A New Social Contract;
  8. Building Stronger and Safer Communities;
  9. Better opportunities through Education and Research;
  10. A Shared Island;
  11. At the Heart of Europe and Global Citizenship; and
  12. Reforming and Reimagining our Public Life.

While each is a separate and distinct mission, green concerns and a drive to take climate action is evident throughout the document. In the policies specifically targeting the energy sector, the Programme for Government focuses on efficiency, renewables, and interconnection. This is not surprising. These are precisely the areas which the European Commission recommended Ireland develop further in June 2019 when the Commission assessed Ireland’s draft ten year plan to take climate action, the draft National Energy and Climate Plan1. (See our briefing here.)

What does the Programme for Government say about energy?

In the table below we cherry-pick from the numerous pledges made in the Programme for Government those of most relevance to businesses either operating in the energy sector, or likely to be affected by the drive to increase energy efficiency. Central areas targeted for Governmental action are listed in the left column, with Governmental pledges detailed in the right column.

Area

Pledges

Emissions and Renewable Energy Targets
  • To produce a Whole-of-Government plan setting out how it will deliver at least 70% renewable electricity by 2030 and how it will develop the necessary skills base, supply chains, legislation and infrastructure. This new plan will recommend measures to accelerate the deployment of renewable electricity, for example the provision and granting of permissions for grid connections.
  • To achieve a 7% per annum reduction in overall greenhouse gas emissions from 2021 to 2030 (a 51% reduction over the decade).
  • To achieve net zero emissions by 2050, with the 2050 target set in law by the Climate Action Bill which will be introduced in the Dáil within the first 100 days of Government; alongside a newly established Climate Action Council. The Climate Action Bill will define how five-year carbon budgets will be set. The special economic and social role of agriculture and the distinct characteristics of biogenic methane are to be fully recognised in plans to achieve these targets.
  • To hold the first Renewable Electricity Support Scheme (“RESS”) auction by the end of 2020, with auctions held each year thereafter, including the first RESS auction for offshore wind in 2021.

[This is in line with the timetable EirGrid has in place with the first auction scheduled to open on 21 July 2020 and close on 4 August 2020.]

Carbon Tax
  • To increase the carbon tax to €100 per tonne by 2030 while preventing fuel poverty.  The approach will be informed by the findings of an ESRI study to be published by October 2020. This increase is to be achieved by an annual increase of €7.50 per annum until 2029 and €6.50 in 2030.
  • To legislate to hypothecate all additional carbon tax revenue into a Climate Action Fund raising an estimated €9.5 billion over the next ten years.  This Fund will be utilised over that period to:

(i) ensure that the increases in the carbon tax are progressive by spending €3 billion on targeted social welfare and other initiatives to prevent fuel poverty and ensure a just transition; and

(ii) provide €5 billion to part fund a socially progressive national retrofitting programme targeting all homes but with a particular emphasis on the Midlands region and on social and low-income tenancies.

Energy Efficiency
  • To implement an ambitious National Energy Efficiency Action Plan, which will set higher targets for all sectors.
  • To continue EirGrid’s programme “Delivering a Secure, Sustainable Electricity System” (“DS3”).
  • To publish a National Retrofitting Plan as part of the National Economic Plan which will develop a new Area-Based and one-stop-shop approach to retrofitting to upgrade at least 500,000 homes to a B2 by 2030.
  • To ensure that the energy efficiency potential of smart meters starts to be deployed in 2021 and that all mechanical electricity meters are replaced by 2024.
  • To amend the Energy Efficiency Obligation Scheme to boost the supply of retrofits, by increasing the targets which obligated parties must deliver.
  • To set a public sector decarbonisation target of at least 50% by 2030.
  • To introduce efficiency standards for equipment and processes, particularly those set to grow rapidly such as Data Centres.

Scaled Up Programme for District Heating
  • To launch a scaled-up programme for district heating.
  • To introduce requirements for heating systems and to develop a suitable regulatory environment. The Government has stated that “as well as developing a regularity environment for district heating, we will publish a feasibility study on establishing a district heating authority and setting new targets for district heating as part of a new strategy”.

Offshore Energy
  • To realise the immense potential of Ireland’s offshore renewables, “taking advantage of a potential of at least 30GW of offshore floating wind power in our deeper waters in the Atlantic”.
  • To set a path to achieving 5GW capacity in offshore wind by 2030 off Ireland’s Eastern and Southern coasts.

Plans for the Marine Sector with implications for Offshore Energy
  • To give cross-Government priority to the drafting of the Marine Planning and Development Bill so that it is published as soon as possible and enacted within nine months.
  • To publish Ireland’s first ever marine spatial planning policy2. Upon its completion, the Government has stated it will bring forward Ireland’s first ever National Marine Planning Framework. Together these two documents will form the basis for Project Ireland Marine 2040, our long-term overarching strategy to manage Ireland’s seas for the benefit of all its people.
  • To provide comprehensive legislation for the identification, designation and management of Marine Protected Areas in Irish territorial waters.
  • To evaluate and implement plans to realise the carbon sink potential of our marine environment based on the introduction of Marine Protection Areas.
  • To develop a new integrated marine sustainable development plan, as a successor to Harnessing Our Ocean Wealth, which focuses on all aspects of the marine.
  • To fulfil Ireland’s outstanding obligations under the Marine Strategy Framework Directive as soon as possible and to have 30% of marine and coastal areas protected by 20303. It is planned for this to be done in close consultation with all stakeholders, with the consultation process to begin within the first 100 days of Government.

Interconnectors, Storage, and Projects of Common Interest (“PCIs”)
  • To support work on the Celtic Interconnector, which will link Ireland to Europe’s energy grid, increase competition in electricity prices, and help Ireland to switch to at least 70% renewable electricity.
  • To commence planning for future interconnection with our neighbours.
  • To strengthen the policy framework to incentivise electricity storage and interconnection.
  • To support the tightening of the sustainability assessment rules prior to the approval of any projects on the EU PCI list.

Solar, Wind, Bioenergy, and Green Hydrogen
  • To develop a solar energy strategy for rooftop and ground based photovoltaics to ensure that a greater share of our electricity needs are met through solar power.
  • To finalise and publish the Wind Energy Guidelines.
  • To rapidly evaluate the potential role of sustainable bioenergy, defined by the Sustainable Energy Authority of Ireland as “renewable energy generated when we burn biomass fuel. Biomass fuels come from organic material such as harvest residues, purpose-grown crops and organic waste from our homes, businesses and farms.”
  • To invest in research and development in ‘green’ hydrogen (generated using excess renewable energy) as a fuel for power generation, manufacturing, energy storage and transport.

Peat and Gas
  • To support the Just Transition Commissioner in designing a comprehensive and inclusive response to the exit from peat in the midlands.
  • To publish and implement a detailed all-of-Government implementation plan on the exit of peat in the Midlands consistent with the recommendations of the first report of the Just Transition Commissioner.
  • To conduct a feasibility study into the establishment of a Green Energy Hub/Renewable Energy Hub in the Midlands, using the existing infrastructure in this region.
  • To end the issue of new licences for the exploration and extraction of gas, on the same basis as the recent decision in relation to oil exploration and extraction.

Conclusion

The Programme for Government is a high-level ambitious plan for Government policy. It gives a strong indication of the destination the newly formed Government would like to reach and the actions they propose to take us there. For the energy sector the Programme for Government signals a green light for offshore development, district heating, interconnectors and solar power; an amber light for peat; and a red light for new gas exploration.

Click here to view.

  1. European Commission Recommendation of 18 June 2019 on the draft integrated National Energy and Climate Plan of Ireland covering the period 2021-2030 (accessible here).
  2. Under EU Directive 2014/89/EU establishing a framework for maritime spatial planning Ireland is required to draw up its maritime spatial plan no later than 31 March 2021.
  3. Ireland has European and International obligations to protect its marine waters under article 13 of the Marine Strategy Framework Directive, the Aichi biodiversity targets, the UN Sustainable Development Goals and OSPAR Convention.

This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.