The European Commission has told the Government it is not doing enough to tackle climate change and has asked it to alter its strategy to reduce greenhouse gas emissions.
The commission has ruled that Ireland must reduce the level of allowances that industry receives to produce greenhouse gases by 6.4 per cent between 2008 and 2012. It has also set tough limits on the amount of carbon credits industry can purchase from the developing world to meet its obligations under the Kyoto Protocol.
Taoiseach Bertie Ahern defended the Government's record on curbing emissions and said it was committed to meeting its Kyoto targets. Under the protocol, Ireland is allowed to increase its CO2 emissions to 13 per cent above 1990 levels. Emissions currently stand at 23 per cent above these levels.
Ireland was one of 10 member states told to change their national allocation plans and it must now resubmit its plans before the end of the year.
The commission highlighted five problems with the Government's national allocation plan. It has told it to reduce the maximum annual allocation of allowances to 21.15 million tonnes; remove special reserves for specific industry sectors; provide more information on how new entrants are treated; remove adjustments provided for in the case of companies closing, and reduce the maximum amount of credits which companies can buy from projects in the developing world.
Mr Ahern said in Brussels yesterday: "We are very serious and the commission know that. We have committed to meet the Kyoto Protocol target to reduce national greenhouse gas emissions to 13 per cent above the 1990 levels.
"The strength of economy is putting upward pressure on emissions and we have to deal with that and we are dealing with that."
Minister for the Environment Dick Roche said he was hopeful the issues raised by the commission could be addressed and an agreement reached "on an allocation closer to what we originally proposed". He said there would be progress by the Government in purchasing carbon credit and allowances - one of the issues highlighted by the commission - by the deadline of December 31st.
Mr Roche is seeking Dáil approval today for an agreement with the European Bank for Reconstruction and Development to invest €20 million in its new multilateral carbon credit fund. He said he is also to publish the Carbon Fund Bill very shortly.
He maintained the commission viewed this as an important indication of progress.
"I believe we will be able to demonstrate sufficient progress to deal with the commission's concerns on this issue," he said.
Mr Roche told an Oireachtas committee yesterday that reaching the Kyoto targets would be "extremely challenging". However, he said a huge amount had already been done.
Using the "flexible mechanism" to buy carbon credit on the international market or fund carbon reduction projects abroad did not mean that Ireland was seeking to buy its way out of its commitments. He said Ireland would purchase up to 3.6 million credits for each of the five years from 2008 to 2012.
The €20 million scheme going through the Dáil this week is being opposed by the Labour Party. Ciarán Cuffe of the Green Party said the taxpayer would have to pay at least €100 million on carbon emission charges and called for greater steps to reduce greenhouse gas emissions in Ireland.
Employers body Ibec said the commission decision to reduce emission limits would increase costs and lead to higher prices for goods and electricity.