Paris Agreement: €30bn Cost for Ireland.

The Paris Agreement will cost Ireland more than €30bn. Although the Attorney General advised the Government that it is necessary to have an indication of the overall costs of complying with the Paris Agreement on climate change prior to Oireacthtas ratification[1] the Minister for Communications, Climate Action and Environment, Denis Naughten has yet to reveal the cost.

If the full costs, direct and indirect, are made known, as they were in Germany, similar excitement can be expected in Ireland. Peter Altmaier, Germany’s Environment Minister said that the transition to renewable energy may cost up to a staggering €1,000bn during the next two decades.[2] His statement comes on the heels of a study published earlier in the month by the Dusseldorf Institute for Competition Economics (DICE), which reveals that the total cost of the energy transition in the electricity sector alone will amount to over €520bn by 2025. This represents a cost, direct and indirect, to a German household of four, of more than €25,000[3].

The EU and the US have taken entirely different approaches towards reducing greenhouse gas (GHG) emissions with remarkably different results. The EU has focussed on replacing fossil fuels (coal, oil and gas) with renewables (wind and solar). After Fukushima Angela Merkel decided that Germany’s nuclear power plants should be switched off and perversely coal, oil and gas have filled the energy gap. The EU’s incoherent policy has driven up the cost of EU energy and reduced competitiveness. The US on the other hand has facilitated fracking. Gas and oil prices have plummeted. Energy providers have switched from coal to cleaner, cheaper gas and as a result the US has been three times as successful as the EU in reducing its GHG emissions[4]. US electricity prices are now typically half those in the EU: a win/win for the US and a lose/lose for the EU.

China has only recently taken an interest in the matter and is motivated less by the threat of global warming than by the need to address intense problems of urban smog that make city living unpleasant and unhealthy[5]. China is operating on all fronts. In addition to major solar and wind projects, 35 nuclear plants have been commissioned, a further 20 are under construction and more are planned[6]. But, flying in the face of the Paris agreement, it has 610 coal-fired plants in planning or construction; emissions from which are likely to nullify whatever reductions the EU might make[7].

The Paris agreement requires the EU to reduce its 2030 GHG emissions by 40 percent compared to 1990[8]. The target set for Ireland represents a particularly difficult challenge. Unlike other EU countries agriculture is responsible for most of Ireland’s GHG emissions (33 percent). Cows produce almost all of it: so the only way to make reductions in this sector is to reduce numbers. Plans are otherwise.

Assuming Ireland’s beef and dairy herds are not reduced, the burden of emission reduction must be piled onto the remaining sectors: energy, transport, industry, and residential. Perversely, unlike other EU countries, Irish industry is already remarkably clean (only 16 percent of total emissions) so there are few high-polluting heavy industries where emissions can be relatively cheaply reduced. Transportation emission are also difficult to reduce: they have increased with the growth of the economy. Unlike other EU countries Ireland has permitted house-building across the countryside and for many a car, rather than public transport, is essential. Because of these special factors Ireland is facing one of the greatest and potentially costliest challenges of any EU country in meeting the emission targets. The total cost has yet to be divulged. If the figures released in Germany during the past weeks are any guide the total cost for Ireland, between now and 2030, is likely to be in the €30bn to €40bn range: equivalent to a quarter of the national debt. If the Oireachtas is provided with a lower figure, then questions need to be asked.

Recent studies by eminent scientists are now raising questions about the validity of the models upon which global warming predictions have been based[9] [10] [11] [12]. Indeed, actual temperature measurements during the past 30 years have failed to increase as rapidly as computer models predicted[13] [14] [15] [16]. While there is no doubt that there is some gradual global warming taking place, there is reason to be sceptical about alarmist projections and the extent to which GHG emissions contribute.

Other developments raise doubts about aspects of the climate agenda. For example, archaeological excavations in Greenland by researchers from the National Museum in Copenhagen suggest that temperatures in the Arctic were warmer than they are at present, during a 300-year period from 950 AD, when the first Nordic farming communities established themselves there. The climate was sufficiently mild for them to grow crops of barley in coastal farms[17]. The communities died out with the arrival of the so-called Little Ice Age of the sixteenth and seventeenth centuries when Europe became colder, the Thames in London froze at times to depths of 11 inches and British coastal harbours were on occasion blocked by sea ice[18]. Since then the climate has become warmer. There is no doubt that global warming is taking place at present, nor any doubt that the globe will continue to go through warming and cooling cycles as it has in the past. Nor is there doubt that GHG emissions have some impact on climate change. However, there is still considerably debate amongst scientists as to the extent to which GHG emissions contribute to this change[19] [20]. There is good reason to be sceptical about alarmist projections when access by vested interests to large sums of public funds is at stake.

The EU imposition on the Irish people of a programme that may require expenditure comparable in magnitude to one quarter of the national debt, should not be accepted by the Oireachtas without the most careful consideration. After Japan, Ireland’s per capita debt is still the highest in the world[21]. Until there is clearer evidence that temperature growth predictions are not as exaggerated as many reputable scientists believe, Ireland would be wise to hasten slowly. In the event that the Oireachtas refuses to ratify the Paris agreement it is estimated that EU fines of up to €5.5bn may arise by 2030[22]; suggesting an alternate approach.

Dr Edward Walsh has served as