Dáil Éireann Debate, Thursday - 25 June 2026
75. Deputy Pa Daly asked the Tánaiste and Minister for Finance the contingency planning he is making for the potential €28 billion in fines that Ireland may owe due to missing our climate targets; and if he will make a statement on the matter. [48314/26]
Amharc ar fhreagraThe Irish Fiscal Advisory Council – Climate Change Advisory Council paper from 2025 estimated Ireland could face compliance costs of between €8 and €26 billion, not the €28 billion figure quoted in the question. This wide range is the result of a cumulative estimate covering several pieces of climate and energy legislation, each with its own unique compliance framework and mechanism – none of which include the imposition of direct fines or penalties.
Compliance with our European climate targets comes under a group of regulations and directives including the Effort Sharing Regulation, the Land Use Land Use Change and Forestry Regulation, and the Renewable Energy Directive. The compliance options available vary across these pieces of legislation and can be achieved, for example, through purchasing emissions allowances, purchasing statistical transfers of renewable energy, purchasing land removal units, or through participation in joint funds to finance decarbonisation projects across the EU. These mechanisms all have the same aim of encouraging EU Member States to keep moving towards the end goal of decarbonisation – the revenues from selling these allowances, transfers or units must be used for climate measures in the recipient Member States.
As the Deputy will be aware, the emissions figures are not known and therefore compliance cost estimates – which are a function of the price and volume of these elements and will emerge over several years - are simply unknowable at this point in time. Estimating these costs requires working with significant data limitations and the IFAC/CCAC paper references this uncertainty throughout.
The main objective of Government continues to be achieving compliance with our targets through reducing emissions and increasing renewable energy generation in Ireland. The Government has been delivering on this by improving our electricity system, through investing in renewable sources of energy, by increasing public transport use as well as the number of electric vehicles on our roads, by retrofitting over half-a-million homes with technologies and by supporting the bioeconomy and nature restoration. The Environmental Protection Agency has shown that emissions reductions are being made with Ireland’s greenhouse gas emissions decreasing by over 10% in the last three years, notwithstanding strong economic and demographic growth in that time.
