Irish Climate Action Not to be Dictated by Oil Industry


Minister for the Environment, Richard Bruton, has said he “cannot contemplate” a scenario where the oil industry dictates the Government’s climate change action plans.

Mr Bruton was responding to a threat from the Irish Petroleum Industry Association (IPIA) of legal action in relation to the Government’s funding of the €500 million climate plan using oil levies.

IPIA believes that surplus levies should be handed back to the association to assist its climate change mitigation measures, however, Mr Bruton said this was “not a runner.”

When established, last year, the Government announced that the Climate Action Fund would be principally financed by diverting money from the oil products levy which was introduced in 1996 to pay for the running of the National Oil Reserves Agency (Nora).

This agency is responsible for holding 90 days of oil stocks for supply in an emergency. The levy, which is 2 cent per litre, is paid by consumers and transferred by oil companies to Nora.

IPIA, which represents the oil companies has told Mr Bruton that under the law, all funds generated from the levy must be used exclusively to fund the operations of the agency itself.

The association is understood to have told Mr Bruton during a series of meetings that according to its legal advice, the levy must be set at a rate which meets the running costs of the agency, but that it should not exceed this. Despite this, it is understood that Nora has built up a cash balance of up to €200 million.

Mr Bruton has rejected this proposal, stating, “I cannot contemplate a situation where this money is handed back to the industry, or that a new fund is created where the industry could oversee or determine the types of projects to be supported.”

He continued to say, “Such an approach would not give the public confidence that the money was being used in a fair and independent way to support our climate objectives.”

Mr Bruton recognised that the Government’s climate action plans were “a threat to the profits of the oil industry.” In particular, the oil industry would be hit by plans to move to electric vehicles and renewable heating systems.

“I hope that in the years ahead, the oil industry concentrates on diversifying into renewable energy and supporting the transition towards net zero-carbon emissions. It would be counterproductive for them to try to stall important climate action.”

The levy was “not paid for from the pockets of the oil industry – it is entirely paid by the consumer at the pump,” Mr Bruton said. It was up to him to decide what projects were supported by the fund.

“The Government will not contemplate a situation where the oil industry can determine how the Nora fund surplus is invested or used.”

The €500 million fund was a crucial part of delivering on climate action, he said. “I regret that the oil industry is threatening legal action against the Government.”

People Before Profit TD, Bríd Smith, said the legal threats showed the industry remained determined to put its interest before climate action. “The arrogance and confidence of the fossil fuel industry is rising as fast as our emissions.”

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