Houses of the Oireachtas

All parliamentary debates are now being published on our new website. The publication of debates on this website will cease in December 2018.

Go to oireachtas.ie

Energy Bill 2016 [Seanad]: Second Stage (Resumed) (Continued)

Wednesday, 29 June 2016

Dáil Éireann Debate
Vol. 915 No. 3

First Page Previous Page Page of 85 Next Page Last Page

(Speaker Continuing)

[Deputy Thomas P. Broughan: Information on Thomas P. Broughan Zoom on Thomas P. Broughan] We recall how the Fine Gael and Labour Party Government sold Bord Gáis Eireann at the earliest opportunity and retained only the pipework with Ervia, and how the same Government ended our last foothold in a national airline with the sale of Aer Lingus.

I welcome section 5 in Part 3 covering the power to carry out investigations and impose administrative sanction whereby the powers of the commission will be enhanced. The Commission for Energy Regulation, CER, may revoke a licence and the Bill provides for further administrative sanctions, such as the seeking of High Court compliance orders and the imposition of fines. Our constituents will ask why the powers are only enhanced to extend to administrative sanctions and why clear criminal sanctions for company principals are not applied where market fixing or price gouging is occurring.

The new sections 56 and 58, also under Part 3, amend the 1999 Act and allow for the provision of the appointment of inspectors and their powers. The new sections 59 through to 66 provide for the action which must be undertaken by these inspectors once they have completed their investigations, as well as the action arising therefrom. Section 59 provides for the completion of the draft investigation report, on which the body being investigated will have the opportunity to make submissions. The inspector, of course, cannot make any recommendations on the imposition of sanctions. The subsequent sections provide for oral hearings, court procedures and appeals, and the new section 66 provides for the power to impose administrative sanctions. Again, I wonder why these are only administrative. If there is clear evidence of price fixing or other interference with energy markets, why is there not provision for sanctions under criminal law?

We must ask whether the CER has ever been fit for purpose. When the Minister was on the Opposition side of the House, he sometimes questioned some of the decisions made by the CER. On the positive side for the CER, particularly since critical contributions have been made by the Minister and me over the years, more information is being provided to us regularly with regard to how decisions are made. The CER has failed to regulate price gouging and in the previous Dáil I called for its abolition and to start again. At the very least, the regulation of the energy sector requires a total relaunch and rebranding. Now the CER has been given a totally unnecessary role in the disastrous mismanagement of Irish Water.

Irish consumers have had to endure huge increases in electricity and gas prices during the years, and a recent EUROSTAT report showed we had the third highest energy prices in the European Union. I believe the Minister has said it is the second highest in some areas of energy, because when EU taxes and levies are disregarded in the EU-wide country comparison, Ireland comes out at second highest. While our lack of indigenous energy and the burdensome public service obligation, PSO, levy to stimulate production of renewable energy have played significant roles in our high energy prices, the existing regulator has simply failed in its primary function of invigilating Irish energy markets. As a result, Ireland continues to have a significant cohort of citizens suffering energy poverty each winter. When I was an energy spokesperson for another party in the House-----

Deputy Denis Naughten: Information on Denis Naughten Zoom on Denis Naughten We were all in that situation.

Deputy Thomas P. Broughan: Information on Thomas P. Broughan Zoom on Thomas P. Broughan The Minister and I have a lot in common. At that time, I drew attention to the levels of energy poverty and constituents I knew who put on their top coat at night and would not put on the gas, desperately trying to keep the price down. We are all familiar with this and it is something we need to attack. There were some very cold months in the winter gone by and this is something we need to address. When I was energy spokesperson previously, the figure for the population suffering in this way was approximately 10%. When we have instances of seniors wearing their coats indoors to keep warm in December, January and February, we as a nation have a serious problem.

While there has been a 37% decrease in wholesale gas prices since May 2015, the CER has now called for a 32% increase in the PSO levy. I read its report closely. I realise there is public consultation on this proposal, but this proposed increase will completely counteract all the recent falls in energy prices across the market. The CER has estimated the PSO levy pot will need to rise from €325.3 million to €440.9 million to ensure security of supply, but the PSO has skyrocketed since 2011, and if the proposed new levy of €441 million is approved, it will have increased by nearly 400% since 2011-2012 when the levy raised approximately €92 million. Domestic consumers will be hard hit individually, with the annual amount in their bills jumping from €60 to just under €80 per customer. This is a very significant part of each hard-pressed householder’s annual bills.

Section 15 of Part 5 covers the wholesale energy market and transparency and provides for the increase of penalties for breaches of REMIT, the EU regulation on energy market integrity and transparency. These provisions seem very welcome, but I worry they are just administrative sanctions and will not be a sufficient deterrent for bad practice or even criminal malpractice. The Minister might say this would be covered under company law and other areas of our legislation, but given the price gouging that has happened in recent years, we need to send a very strong message directly in energy legislation. This section also refers to the possibility of forum shopping and market manipulators. How will this be policed having regard to the all-Ireland and EU wholesale market?

There are a number of miscellaneous amendments to various Acts provided for in the Bill. Part 6 covers amendments to the Sustainable Energy Act 2002. Section 17 provides for amendments to the 2002 Act regarding appointments to the Sustainable Energy Authority of Ireland, SEAl, board. Section 20 of Part 7 covers amendments to the National Oil Reserves Agency, NORA, Act 2007 and inserts a new subsection 43A, which provides for the exchange of information on oil data and payment of NORA levies. Section 22 of Part 7 discusses biofuel obligation account holders, certification and the publication of determinations on NORA's website. Section 24 provides for an increase to the deadline for NORA issuing notices to 75 days from 35 days, therefore increasing flexibility. Most of these changes seem welcome enough.

An important element of the Energy Bill 2016 is the reference to our cross-Border trade in electricity as per Regulation (EC) No. 714/2009 regarding such exchanges. Part 4 of the Bill amends the Act of 1999 to provide for such changes to the single electricity market in the Republic and the North. Of course, in March 2009, we had an historic moment when EirGrid purchased System Operator for Northern Ireland, SONI, which is the transmission system operator, TSO, in the North. This is something many of us interested in energy during the 2000s thought might happen, and this was ultimately good for energy security on the entire island. Together, they operate as the single electricity market operator, SEMO, throughout the whole island. The question must be asked as to whether the Department has been tasked with examining what impact Brexit might have on this. This is something we will have to watch very closely because there have been many important initiatives to increase energy transfers between North and South and between the two islands. Quite clearly, it is a core concern that we retain the security we have at present. What impact will Brexit have on the single electricity market for the island of Ireland?

I welcome the inclusion of section 16 in Part 4 relating to an energy strategy statement. This provides for the submission of a three-year energy strategy statement to the Minister, which must be laid before the Houses of the Oireachtas and subsequently published on the commission's website. The area of energy is something in which most citizens have quite a strong interest. It is a very interesting portfolio. The former Minister, Deputy Eamon Ryan, is sitting behind me. Constituents have drawn to my attention the achievement of Portugal in running on its own power for a particular period and how it had joined other EU countries in having had its major power grid powered by domestic renewable energy. I believe other countries have passed this milestone. This will be a big challenge for the Minister with regard to his climate change designation.

Another issue which has been raised, and to which the Minister might refer, is when he will become the Minister for bins. As somebody said, he has been given a hospital pass by the Government scrum-half, the Minister, Deputy Simon Coveney. That rugby ball is now heading across to his hands. I was asked by the Department today to refer issues to the Minister, Deputy Simon Coveney. Perhaps the Minister might give us an indication as to when he will catch the ball.


Last Updated: 28/02/2020 16:23:11 First Page Previous Page Page of 85 Next Page Last Page