Dáil Éireann Debate, Wednesday - 18 February 2026
18. Deputy Mairéad Farrell asked the Minister for Climate, Energy and the Environment if his Department expects the renewable heating obligation to increase energy prices for the 700,000 homes, mostly in rural Ireland, that use heating oil; if so, if there will be financial supports available to those affected by such an energy price increase; and if he will make a statement on the matter. [13161/26]
View answerThe Government is committed to ensuring secure, affordable and sustainable energy for all households in Ireland. Our reliance on fossil fuels in heating our homes is a significant contributor to our high energy import dependency and carbon emissions. The introduction of the Renewable Heat Obligation (RHO) is a key objective for me, as Minister, to address these challenges.
Given the potential impact the RHO could have on end consumers, energy affordability and the impact on household energy bills were key considerations in developing the scheme. My Department has carried out extensive analysis and stakeholder engagement activities, including with energy suppliers, to ensure final decisions taken in relation to the scheme are evidence-based and supportive of its successful introduction.
A number of scheme parameters have been designed to allow flexibility to obligated parties in meeting their obligations, which will in turn reduce the cost on the end consumer. Detail in relation to each phase of analysis, including the full assessment carried out on potential obligation rates, and scheme costs is available at: www.gov.ie/en/department-of-climate-energy-and-the-environment/publications/renewable-heat-obligation/
Based on the currently proposed obligation rates of 1.5% in year one and 3% in year two, and costs socialised equally across an obligated party’s whole consumer base, the impact on a typical household energy bill will range between 0.4% and 0.7% in year 1, depending on fuel type. In year 2, this will range between 0.9% and 1.4%.
Any increase to obligation rates from year 3 will be subject to a further review of market conditions and scheme performance, and take into consideration the most cost effective and affordable way to achieve our energy objectives.
The Programme for Government acknowledges the increased energy cost pressures on households and businesses, and commits to bringing forward additional measures to address these costs. My Department has established a cross-Government Energy Affordability Taskforce to identify, assess and implement measures that will enhance energy affordability for households and businesses, while delivering key renewables commitments and protecting security of supply and economic stability. The taskforce has recently published an interim report, which set out measures that were considered as part of the Budget 2026 process, and in advance of publication of the Energy Affordability Action Plan later this year.
