Ireland will have to pay tens of millions of euro in annual penalties to meet its obligations to curb carbon dioxide emissions by 2012 in line with United Nations Kyoto Treaty commitments, writes Mark Hennessy, Political Correspondent
Under the treaty, the State is allowed to boost CO2 production to 13 per cent above of 1990 levels - although production from industry, homes and transport is currently running at 23 per cent above the agreed target.
The State must now cut CO2 emissions by 7 million tonnes a year - or 10 per cent of total production from 2008 to 2012 if the 1997 UN pledge is to be met, the Minister for the Environment and Local Government, Dick Roche, told journalists at a conference in Dún Laoghaire, Dublin, yesterday.
Publishing a consultation document on the future shape of Ireland's CO2 policy, Mr Roche said actions by the Government has already cut 8 million tonnes a year off the State's tally.
However, this reduction is largely accounted for by the increase use of natural gas, the closure of Irish Fertilisers and Irish Steel and reductions forced by the European Union in the size of the national cattle herd.
Further reductions have been achieved by planting new forests which act as carbon "sinks", the greater use of wind energy, better insulated buildings, biofuels, the removal of traffic bottlenecks on the roads and other measures, according to the Department's document, Ireland's Pathway to Kyoto Compliance.
Industry has been given responsibility for cutting 3 million of the outstanding 7 million tonnes under the national allocation plan published recently by the Environmental Protection Agency, though 4 million tonnes worth of reductions will have to be made in the energy use required by transport, housing and other sectors of society.
However, the Environmental Protection Agency has already made it clear that the State is ready to buy credits for up to 3.6 million tonnes of CO2 production, where Irish production can be compensated for by cuts somewhere else in the world.
Nevertheless, Mr Roche said he wanted to minimise the purchase of carbon credits.
"Buying allowances through the mechanisms does represent reduced emissions elsewhere and, as climate change is a global problem, I am completely satisfied that using this option is contributing to the overall aims of the Kyoto Protocol. It is, nevertheless, not the best solution for Ireland in the longer term."
The more curbs Ireland put in place now, the "more we will be able to reduce our emissions between now and 2012 and the better prepared we will be to take on potentially more demanding targets beyond 2012", he said.
Top UN experts on climate change believe that global emissions of carbon dioxide will need to be cut by up to 70 per cent below 1990 levels if irreversible damage to the world's environment is to be prevented.
An international carbon dioxide trading market has already been established, though the cost of carbon credits has fallen dramatically from €29 a tonne to €17 a tonne since April, following signals that industry internationally may have to buy fewer of the licences than had been expected.
The Government will not impose a carbon tax to discourage the use of fossil fuels or fossil fuel-generated electricity, Mr Roche said.
"There were huge increases in fuel prices over the last year and there wasn't a huge reduction in the use of such fuels by the public. There is a degree of price inelasticity," he told The Irish Times.
The greater use of natural gas for home heating and electricity production and the consequent drop in the numbers heated by open fires has meant that the CO2 production of the State's homes has fallen significantly since 1990, even though 80,000 houses a year are now being built.
Furthermore, the Minister said the economy now got better value from oil, gas and other forms of energy, since it had grown by 150 per cent since 1990, although energy consumption has increased by 23 per cent.
Nearly 60 per cent of all electricity generated by the ESB and other operators is wasted because of inefficiencies in generating plants and losses suffered as the power is transmitted through the State.