Fuels for Ireland launches State aid complaint

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As highlighted at the recent UKIFDA Expo 2021 webinar Fuels for Ireland has initiated a State aid complaint against the Irish State in response to discrimination which places the sole responsibility to fund the Government’s Climate Action Fund on oil-based energy consumers and fails to similarly hold to account other energy sources which cause greenhouse gas emissions.

The trade association, which represents companies involved in the importation, distribution and marketing of petroleum products and low-carbon liquid fuels, says its members and consumers of their products  are being unfairly and unlawfully held responsible to meet the costs of the Climate Action Fund, while other energy providers such as gas, solid fuels and electricity from non-renewable sources make no such contribution.

This State aid complaint, lodged, is based on recent changes to a levy which only Fuels for Ireland members, and therefore consumers of their products, are required to pay.  No other energy provider is paying into this fund.

The National Oil Reserves Agency (NORA) ensures Ireland meets its obligations under international law to maintain a minimum of 90 days stocks of oil for use in the event of a physical shortage of supplies. A levy of 2 cents per litre is paid by Fuels for Ireland members and their consumers to safeguard Ireland’s oil supply and to cover the expenses incurred in managing the Agency.

The Government recently enacted a piece of legislation, the National Oil Reserves Agency (Amendment) and Provision of Central Treasury Services Act 2020, which will redirect all income from the NORA levy to the Climate Action Fund – having the effect of placing the entire burden for funding its vital projects on oil consumers.

Fuels for Ireland has complained to the EU Commission that this diversion of funds constitutes State aid.  The complaint states that it is discriminatory to its members and its consumers as the burden of funding the Climate Action Fund is not being shared equally by all non-renewable energy providers and consumers.

Given the importance of ensuring that Ireland meets its carbon reduction targets and sustainably funds a just transition to carbon neutrality, it is imperative that all greenhouse gas emitting energy users contribute to the Climate Action Fund, according to Fuels for Ireland.

“Our members and our consumers are being unfairly targeted to be the sole contributors to the Climate Action Fund. We are determined to play our part in addressing our climate and environmental emergency and  funding Ireland’s Climate Action plans. We have made the commitment to be carbon neutral by 2050 but we cannot stand by and allow our consumers to be the only ones paying for Ireland’s Climate Action Fund,” said Fuels for Ireland CEO Kevin McPartlan.   

“We have brought this matter to the attention of the Minister and the Department on several occasions. The State is discriminating against people who use home heating oil to keep their homes warm, put petrol or diesel into the cars to get to work or bring their kids to school and we have been forced to bring this issue to the European Commission through this State aid complaint. 

“The measure particularly singles out our consumers in rural Ireland who do not have the same public or active transport options, rather than their car, who use home heating oil, rather than being connected to the gas grid or where electric vehicles are simply not an option.”  

“Other energy providers like gas, solid fuels and electricity from non-renewable sources do not have any obligations to contribute to the costs of  the Climate Action Fund.  This is clearly unfair, disproportionate, unjustified and amounts to State aid,” said Kevin McPartlan.