We support Energise Ireland Manifesto
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Construct Ireland’s manifesto for an energy revolution
The future of every Irish business, family, homeowner, tenant, public servant – every citizen – will be dramatically improved or undermined by what we do about energy.
If we’re slow to act and continue to treat the green economy as a subset of the economy, we’re destined for immediate and continuous economic decline, as Ernst & Young’s latest economic analysis demonstrates 1. But if we seize the initiative and engage in an energy revolution across the whole Irish economy, Ireland can recover.
We can make the entire Irish jobs market bigger and more secure, we can improve average life expectancies, we can all become wealthier and turn Ireland from a cautionary tale of economic mismanagement to a pioneering exemplar of a just, sustainable society.
Summary
By engaging in an energy revolution Ireland will…
…lead to hundreds of thousands of jobs being created or secured in several ways, including the installation of energy efficiency measures, the manufacturing of energy saving technology and materials for the domestic and export markets, and inducing job creation in unrelated sectors resulting from more money being brought into circulation. The entire jobs market will be stabilised and pressure taken off struggling businesses and households by reducing their energy costs, cutting their exposure to energy price spikes and bringing more money into circulation.
…improve our balance of trade by reducing energy imports and making Irish exports more competitive by cutting manufacturing and operating costs.
…bring an immediate injection of cash into circulation through issuing bonds ring-fenced for efficiency investments, a safe, patriotic investment opportunity for Irish people nervous about their savings.
…gain a significant net tax benefit to the public finances through immediate tax revenue increases that will outweigh subsidy costs 2, and stabilise the tax base by making businesses more solvent.
…reduce the cost of running the state by cutting energy wastage in schools, hospitals, civic buildings, street lighting etc and reducing health sector and social welfare costs arising from fuel poverty.
…send a clear message internationally that Ireland is taking a smart, strategic approach to economic recovery
First of all, Ireland must face up to the fact that…
…90% of our energy consumption is imported fossil fuel, the highest of any EU-15 member state. The only European countries with higher fossil fuel dependencies are Malta, Luxembourg and Cyprus. Primary energy consumption in Ireland in 2009 was 14.9 million tonnes of oil equivalent (Mtoe) – roughly 110m barrels of oil equivalent per annum 3.
…economic recovery will not be possible without dramatically cutting energy imports. An upturn in exports will only happen in the event of global economic recovery, which would force energy prices higher, thereby cancelling out extra income from exports.
…our ability to attract foreign direct investment may be compromised by our high reliance on fossil energy imports compared to other competing economies. Companies may be discouraged by Ireland’s exposure to energy price spikes and supply interruptions.
…we’re bound by EU policy to cut energy consumption and CO2 emissions. If Ireland is slower to act than European and other countries, we’ll remain reliant on paying other more advanced economies for the green skills, services, materials and technologies necessary to hit our targets.
…Irish exports will be undermined if our suppliers cannot respond to the planned and current sustainability investment drives in forward-thinking economies in the EU, China, the US and the Middle East.
…soaring prices will make it impossible to rely on finite fossil fuels to heat our buildings, run our vehicles and power our grid. Oil supply will become extremely volatile as cheap and easy-to-extract oil runs out. High carbon, difficult-to-extract varieties will still abound – but will only be produced if prices are high.
To avoid an energy crisis and Energise Ireland we must…
…become oil-free and no longer a net energy importer by 2025. Our circumstances demand such an unprecedented shift. Ireland needs an integrated strategy for the entire economy in order to deliver the greatest possible energy efficiency improvements, and shift to renewable energy. Energy demand must be reduced to such a level that renewables alone will suffice, with any spare renewables generation capacity boosting Ireland’s energy exports or enabling energy-intensive industries to locate in Ireland.
…understand that sustainable energy investments will deliver a return up to seven times greater than the cost of the investment 4. As fanciful as it sounds, even a 100% subsidy to cover the cost of sustainable energy investments may be immediately cash flow positive to the exchequer 5 . Taxes will be paid by companies directly and indirectly involved in projects – and businesses in general benefiting from increased cash circulation – including employment taxes, Vat and corporation tax with social welfare spend reduced by bringing people back into work. Additional demonstrable benefits include selling spare carbon permits rather than buying more, and significantly reduced health service spend.
…develop green bonds to offer Irish citizens a safe, patriotic investment that government will use to subsidise or lend to enable energy efficiency works. This could be structured in such a way to circumvent government borrowing restrictions, and offer Irish citizens a transparent, patriotic investment in local projects which are in their nature low risk 6, which increase local job creation and cash circulation and therefore are more likely to benefit the investor in terms of wage increases, job security, tax reductions and/or improvements in public services. This strategy should be aligned with a complimentary proposal for a green IFSC.
…encourage more lending institutions to follow Bank of Ireland’s lead by offering attractive green loan and mortgage packages. Bank of Ireland’s recently announced “green equity release” loan allows customers to unlock equity in their home to invest in energy saving measures costing up to 90% of the value of their property, with repayment terms as low as 3% over five to thirty years. Lenders should be made to factor in estimated energy costs when assessing financed purchases, and adjust lending terms for new homes, upgrades and car loans based on the likely cost of fuel bills over the duration of the loan.
…stimulate world class continuous innovation in developing low energy technology, materials and design approaches. Government policy including subsidies, building regulations and standards must foster a culture of constant innovation without compromising on public safety. Allied to the creation of an Irish test house for sustainable technologies, materials and systems, such an approach could attract many international manufacturers to locate in Ireland, and convince Ireland’s best graduate or experienced engineers and architects that they don’t need to emigrate to have a future.
…make all new homes net zero energy and zero carbon by 2013 7, and upgrade the entire building stock as a whole to net zero carbon by 2020. This will involve the roll out of a building science based approach to retrofitting, heating and power supply and efficient energy management. Such an approach has enormous export potential if we act swiftly, using the best available knowledge.
…end fuel poverty by 2015. Up to 800,000 households may be in or on the cusp of fuel poverty 8. Every euro spent on fuel poverty mitigation reduces health sector expenditure alone by €0.42C 9 and is cash flow positive to the exchequer – by cutting the need for winter fuel supplements, creating direct, indirect and induced employment etc. Poor health caused by fuel poverty weakens the economy – sick people are more likely to become reliant on state assistance, to lose their jobs or default on debts.
…cut embodied energy and resource waste across the Irish economy to the greatest extent possible. Manufacturing can only play a role in Ireland’s recovery if we can be more competitive and more innovative than other competing economies. Every Irish manufacturer must be mobilised to invest in achieving the greatest efficiencies possible to make their own business future-proof, including operational efficiencies and a cradle-to-cradle approach to manufacturing.
…implement world-leading green procurement requirements throughout the public sector. Ireland must aim beyond the EU target of 50% green public procurement by 2010 to give Irish companies the chance to compete to supply other EU countries, many of whom are innovating in green public and corporate procurement. If Irish companies are given certainty that increasingly ambitious green requirements will be applied to all public procurement in the short, medium and long term, they will gain the confidence and encouragement to invest in strategically greening how they do business, and improve their export potential.
…strategically locate district heating and electricity systems to supply industrial estates and business parks, to support existing businesses and encouraging foreign direct investment. Tied to a long-term strategy for Irish biomass fuel supply along with fuel-free energy sources such as wind, solar & geothermal, the energy service company (Esco) model can offer secure energy supply at prices that can be fixed for up to 10 or 15 years. Where possible Escos should be publicly financed – for instance using money secured through green bonds – so that what may be considerable profits go back to the tax payer.
…develop smart metering to include tariffs which stimulate dramatic behavioural change. If the wind blows a gale at 3:15am, smart meters must be able to communicate with appliances and systems in buildings to choose the best time to buy – to give the freezer or heat pump a boost, or to charge the plugged in electric vehicle. Similarly peaks in usage could be flattened if tariffs change subject to demand. When the Rose of Tralee goes to an ad break and 250,000 kettles switch on, the price of electricity needs to vary to take that into account and reward changes in behaviour. Committing to such a system would deliver massive savings, and would stimulate innovation in energy controls with tremendous export potential.
Conclusion
This plan can show the world that economic policy need not be a choice between stimulus and austerity measures. Ireland’s plan can be a stimulus specifically geared to make investments that are self-financing and that cut unnecessary expenditure and improve our balance of trade – a stimulus defined by investing in the cuts that help everyone. It is a plan to deliver energy security and economic growth, protect public health and the environment, and lay the building blocks for the recreation of Ireland as a just, forward-thinking, sustainable economy.
We know we have the natural resources.
We believe we have the entrepreneurial talent.
We must create the structures and programme to grasp this enormous opportunity for Ireland Inc.