Fossil fuel subsidies last year amounted to €4.7 billion, which represented a fall of 6 per cent from just under €5 billion the year before, new data from the Central Statistics Office (CSO) shows.
A number of temporary measures were introduced by the Government in 2022 in response to rises in energy prices.
The temporary measures included direct subsidies to households and businesses to reduce energy costs, as well as tax rate reductions on fossil fuels such as petrol and diesel.
The total amount in fossil fuel subsidies resulting from these measures was estimated at €1.1 billion in 2022 and €1.7 billion in 2023.
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Some of these measures were no longer in operation in 2024 while others were notably reduced, and the value was down 46 per cent to €940 million.
The revenue forgone, or the amount of potential tax revenue not collected, due to the excise exemption for jet kerosene used in commercial aviation was €720 million, representing an increase of 19 per cent.
The reduced excise rate on road diesel when compared to the petrol excise rate led to €370 million in forgone revenue.
The carbon charge for consumers of petrol and road diesel both increased 22 per cent to €274 and €207 per tonne of carbon dioxide emitted respectively.
Consumers of marked gas oil, which is used in agriculture and fishing, paid €76 per tonne of carbon dioxide emitted in 2024, which was a 31 per cent increase on 2023 levels.
Fossil fuel subsidies went from 1.2 per cent of gross national income (GNI) in 2021 to 1.5 per cent in 2024. The maximum since 2014 was reached in 2022, where fossil fuel subsidies represented 1.8 per cent of GNI.
The highest average effective carbon rate per tonne of carbon dioxide in 2024 was €274 for petrol, followed by road diesel at €207. Both rates increased by 22 per cent compared to 2023, exceeding the levels seen before the 18 per cent decrease observed in 2022.
The average effective carbon rate of a fuel is the amount of energy tax, such as excise and carbon tax, paid by consumers per tonne of carbon dioxide emitted through combustion of the fuel.
The road diesel rate is lower than the petrol rate due to a lower excise duty rate. The average effective carbon rate for marked gas oil, sometimes referred to as “green diesel”, used in agriculture, forestry, and fishing, was €76 per tonne of carbon dioxide due to the lower excise duty rates.
The CSO said the recent increase in the average effective carbon rates could be attributed to the removal of temporary excise and National Oil Reserves Agency levy rate reductions introduced in 2022, coupled with increases in carbon tax on these fuels.
This was also observed for aviation gasoline, rail diesel, and marked gas oil used in agriculture and fishing.
In contrast to these increases, the average effective carbon rates on jet kerosene and on fuels used to generate electricity fell.
The charge on jet kerosene decreased from €29 to €24 per tonne of carbon dioxide, while the charge on electricity generation fuels fell from €78 to €55 per tonne of carbon dioxide.
