Oireachtas Monitor – 16th November 2020

Oireachtas Monitor

Climate & Health

Week beginning 16th November 2020

17th November

To ask the Taoiseach the number of meetings of the Climate Action Delivery Board that have taken place to date in 2020; and the number scheduled for the remainder of 2020. — Ged Nash. [36072/20]

Climate Action is a key priority for this Government and progress is overseen by the Cabinet Committee on the Environment and Climate Change, and the Senior Officials Group which supports it.

The Cabinet Committee last met on 9 November 2020 and is scheduled to meet again on 7 December 2020.

It is chaired by the Minister for Environment, Climate and Communications and Transport, Eamon Ryan.

The Cabinet Committee oversees the implementation of the Programme for Government commitments in relation to the environment and climate change. These include:

– the Climate Action (Amendment) Bill;

– Just Transition;

– agriculture and land use considerations;

– access to finance for climate action;

– the development of a National Retrofitting Plan; and

– the progression of matters in furtherance of our move to a higher rate of renewable energy, such as the Marine Planning and Development Bill and the Wind Energy Guidelines.

In addition, it considers progress made on the implementation of the current Climate Action Plan, and the planning which is now underway to develop the next iteration of the Plan.

The Climate Action Delivery Board is chaired by the Secretary General to the Government and the Secretary General of the Department of the Environment, Climate and Communications. The Board has met three times since its establishment in July 2019. It was due to meet in March 2020 but this was postponed due to the onset of the Covid-19 pandemic. The next meeting of the Climate Action Delivery Board will be held in the coming weeks.

To ask the Minister for Environment, Climate and Communications the targets set to ensure the National 2050 Climate Objective as set out in the climate action Bill is being achieved; and if he will make a statement on the matter. — John Lahart. [36179/20]

The Government is committed to an average 7% per annum reduction in overall greenhouse gas emissions from 2021 to 2030, equivalent to a 51% reduction over the decade and to achieving net zero emissions by 2050. A key aspect of delivering on this ambition will be enacting the Climate Action and Low Carbon Development (Amendment) Bill, which will be reinforced by credible on-going policy.

The Bill will establish a 2050 climate neutrality objective in law and place all relevant climate plans and strategies on a statutory footing. The Bill will define how five-year carbon budgets and related sectoral targets will be set, with every sector contributing, ensuring we continue to work to achieve a broad political and societal consensus on the transition to a climate neutral economy and society. Putting these requirements in legislation places a clear obligation on this and future governments for sustained climate action.

The Bill also provides appropriate oversight by Government, a strengthened Climate Change Advisory Council and a significantly strengthened accountability and oversight role by the Oireachtas.

Each year, relevant Ministers will be required to give account annually to an Oireachtas Committee on their performance in adhering to their sector’s carbon budget. Where Ministers are not in compliance with the targets, they will need to outline what consequential measures are envisaged and respond to any recommendations made by the Committee within three months. This ‘comply or explain’ approach will ensure greater oversight to drive delivery.

The annual revision to the Climate Action Plan acts as a further review mechanism and opportunity to re-adjust or refocus actions, if required, to ensure targets are achieved.

The existing governance mechanisms established on an administrative basis by the 2019 Climate Action Plan will also continue, with the Department of the Taoiseach and the Climate Action Delivery Board overseeing implementation of actions under the Climate Action Plan and publishing quarterly progress reports.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach

Finance Bill 2020: Committee Stage (Resumed)

Tuesday 17th November

Discussion on motor taxation:

SECTION 32

Question proposed: “That section 32 stand part of the Bill.”

Denis Naughten:
I will comment on section 34 as well as section 32 to avoid repeating myself later. I have an issue with the worldwide harmonised light vehicle testing procedure because it is nothing more than another three-card trick. We have seen what happened previously with Volkswagen and some car manufacturers whereby they used sleight of hand in terms of the emissions from their vehicles. While we now have a harmonised system for measuring emissions, a laboratory test is still being used to set the emissions for these vehicles rather than an actual emissions profile.

The reason we need to move away from laboratory tests and directly link emissions profiles to motor tax for vehicles is that it will bring about the type of transformational change needed in transport emissions, without having to go down the road of raising carbon taxes, which we spoke about earlier. This has already been proven. If one recalls when the Green Party were last in government, it altered the motor taxation system to incentivise the purchase of diesel vehicles. The scheme was a phenomenal success, far more successful than anyone had expected at the time. In fact, its success has led to a problem with air quality in our cities caused by particulate matter because we discovered that diesel vehicles are far more polluting and damaging to air quality and life expectancy, particularly in cities, than petrol vehicles. When I was a member of Cabinet I made a submission on this to the Minister, and I previously made a submission to the committee on climate change. If we were to replicate the measures that were taken over a decade ago when the Green Party was last in government and altered motor tax on the basis of the actual emissions profile of vehicles, that would be a far more effective tool to drive the type of change we need. It would also act as a very effective congestion charge.

People living in Dublin who choose, despite having a bus route outside their door or access to the Luas, to sit in their diesel vehicles and drive 5 km to and from work on congested roads, have an emissions profile for their vehicles that is far higher than the profiles under the worldwide harmonised light vehicle testing procedure standards. A vehicle that travels long distances from a rural area would have a profile much closer to those in the laboratory tests because it is being driven at a much more efficient rate than vehicles in urban areas. My proposal would also incentivise people who travel and commute long distances to drive at 100 km/h rather than 120 km/h. As we all know, vehicles travelling at 100 km/h are far more efficient and produce far less emissions than vehicles travelling at 120 km/h. In the past, it was suggested that the speed limit on motorways be reduced to 100 km/h. If we used the actual emissions profile of each vehicle, we would not need to alter the speed limit because people would reduce speed by osmosis. This change would also encourage people to avoid travelling in rush hour and park their cars a bit further away from school or work and walk the last kilometre, thereby reducing the emissions profile of their vehicles.

How then do we measure the emissions profile of vehicles? This could be done through an altered national car test using new technology. If, at the end of the national car test, drivers received a certificate detailing the emissions profile and they taxed their vehicle based on that profile, it would be a far more effective tool. It would also incentivise people to choose HVO, which I spoke about earlier, as it has a reduced emissions profile compared with ordinary diesel. It would encourage people to convert diesel vehicles to natural gas or switch to petrol, hybrid and electric vehicles, which would be more efficient. Over time, this would be a far more effective tool in driving the type of change we need to see in Irish society. I know this would be unique to Ireland but it is the way we should go. For this reason, I oppose the approach being taken in sections 32 and 34.

Mairead Farrell:
When we analyse the impact the measures in section 32 will have, we see that they are focused on electric cars that cost between €35,750 and €46,500. Does the Minister agree that the distributional benefits of this measure are geared towards higher earners?

Paschal Donohoe:
I will deal with the different points that were raised. In response to Deputy Mairéad Farrell, some cars that have the lowest possible CO2 emission, which would be in the first band of vehicle registration tax, VRT, are clearly more expensive than the average car, but plenty of cars on the lower bands of VRT, bands 2, 3 and 4, have a very low level of VRT and are not the most expensive cars in the market. When we are designing a structure like this, we need to give the lowest VRT rate to the vehicles that have the lowest emissions. However, other bands have very low levels of VRT for cars which are not the most expensive energy-efficient cars on the market.

Deputy Naughten is correct in stating this is a laboratory test. However, it differs from the other kind of testing that has happened in that it is laboratory testing that more accurately simulates road conditions. I disagree profoundly with the Deputy that this is in any way a three-card trick. This is a method of testing CO2 emissions that is significantly more accurate than the discredited system that preceded it. He asked if we should have a system that relates the VRT rate to the expected CO2 emissions from the vehicle. We have that in the model that is being proposed because the vehicles with the highest emissions have the highest rate of VRT, as the Deputy will know. He is suggesting that we have a VRT model that reflects the actual usage of the car. I am not sure how we could do that with VRT because VRT is charged at point of purchase of the vehicle.

Regarding us having a different system of testing, this will become an EU-wide system of testing as other countries implement the Worldwide Harmonised Light Vehicle Test Procedure, WLTP, system. It would not be feasible or even possible for us to have a non-WLTP testing methodology, particularly as a country that imports cars. We need to have and now have an EU-wide form of testing car emissions. It is, of course, up to us to then decide on how we want to tax based on WLTP, and there are choices regarding the VRT table that is before the Deputy.

This is a significantly more credible way of testing CO2 emissions than what went before it. I have tried to make lower VRT rates applicable across a broader range of vehicles. I am trying to get the balance right between introducing changes that are needed and trying to reflect that this, of course, will cause change in the purchases of vehicles, which in turn will have an effect on car sellers in the State. I think we have the balance right in the measures proposed here.

Denis Naughten:
I accept that VRT must be charged at point of entry and it is not possible to use an actual emissions profile for that. The point I am making is that the Worldwide Harmonised Light Vehicle Test Procedure is still a laboratory test. It is very dependent on the preconditions applied to the model. That model, which has been enshrined in section 32 of the legislation, is then being used in section 34 as the basis for motor tax. I accept that a tax at the point of purchase will need to be on whatever the manufacturer’s profile of the vehicle is; we have no choice in that. However, if following subsequent NCTs, that vehicle is taxed based on the actual emissions profile as certified by the National Car Test centre, it would act as a major incentive for people to avoid congested streets, to use public transport, to use their vehicle in a far more efficient way, to park their car and walk the last kilometre and, to avoid the congestion which is the dirtiest part of any vehicle’s journey. The same applies in the vicinity of schools. It would transform air quality in our towns and cities overnight and would provide motorists with an actual output showing the emissions profile from that vehicle.

Over time as the database builds up, that can be reflected in alterations to the VRT. It might reflect, for example, that the world harmonised model does not work in this country for car A whose actual emissions profile is significantly higher than that. With another vehicle it might be significantly lower, based on the actual data readings in Ireland. The principle is that the motor tax on vehicles should be based on the actual emissions profile of the vehicle rather than being solely dependent on a laboratory test that will not alter over time. Therefore, a ten-year-old vehicle will have a higher emissions profile than a vehicle that has just left the factory. However, if their WLTP ratings are the same, the exact same motor tax will be paid on both vehicles. As we know, motor tax here is a far greater motivator of change than any other form of vehicle taxation.

Pachal Donohoe:
I will keep my comments very brief. It is possible that we could move to the form of taxation the Deputy is proposing, but it is a medium-term project. At the moment our NCT centres do not have the technology to do the kind of real-time CO2 emissions testing he is referring to. We could move to that point over time but it is a medium-term project. What we have here is a significant improvement on where we were in the past and will make a big difference to the purchase of cars that have a less harmful effect on our climate and environment.

I will briefly make reference to the further changes I am making to the NOx surcharge, included in this section. It is a response to the point Deputy Naughten made about NOx particulates at the start of the section.

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