These are, of course, the costs of war, but it is important to recognize that we in Ireland are particularly vulnerable to energy shocks from a litany of short-sighted policy choices made over decades. What once seemed like easy choices—against nuclear, dwindling winds, against LNG, tax hikes—have slowly led us to make more difficult choices about security and consistency of supply and the trade-offs that come with it.
Successive governments have continued to argue that raising the cost of fossil fuels through higher taxes, levies, obligations and excise duties will reduce demand while ignoring the fact that for many people, particularly in rural Ireland, there are no realistic alternatives to fuel Transport their families there and heating needs. Fuel costs continued to escalate without impacting demand as essential energy sources became scarcer.
In Ireland, half of our total energy needs are now met by oil. When it comes to energy supply, fuel price and energy security, Ireland is constrained in many ways. Our renewable energy sector is still in its infancy. We have no nuclear capacity to provide reserves. There has been a reluctance to explore low-carbon liquid alternatives such as biofuels. We blocked LNG for a generation. We are on the edge of Europe. Compared to other countries, we don’t have many options.
Accordingly, we will see a shortage of supply – and we must be prepared for that. Europe has become massively dependent on Vladimir Putin’s regime for its energy. A total of 55 percent of German gas and 80 percent of Austrian gas in 2021 came from Russia. Overall, 27 percent of the EU’s crude oil came from Russia in 2019. When EU sanctions are introduced, these countries will be chasing the very same limited sources of supply as we are. It reduces the supply but the demand remains the same.
This must inform our thinking on how to proceed in this current tragic situation and beyond. If Europe rejects Russian oil, there is no doubt that others will accept it at greatly reduced prices.
Even without formal sanctions, we are moving away from Russian oil and gas; and the financial support it gives Putin’s regime. This, of course, put pressure on supply chains, but we have maintained fuel supplies throughout – to keep homes warm, farming and industry running and transport moving.
What few people outside of the industry understand is the just-in-time nature of fuel supply chain logistics. Ireland’s commercial terminals never hold more than a few weeks’ supplies – often just a few days, but working with the Government and the National Oil Reserves Agency (NORA) we have always kept fuel flowing despite the challenges of the past few months.
NORA monitors commercial stock levels on a daily basis to ensure supplies are not compromised. At times, this has required fuel suppliers to exercise responsible inventory management – for example, limiting home heating oil deliveries to 500 liters.
This close collaboration and monitoring can be relied upon to ensure continuity of supply during the transition period as new supply arrangements are made. While we don’t expect to draw on it, having a strategic stockpile of fuel equivalent to 90 days’ use of NORA’s fuel is also a reassuring safety net should we face additional challenges.
At the same time, we must not lose sight of the need for fairness. It is unreasonable that those who depend on heating oil at home have been ignored by a government that has introduced policies to lessen the impact of high global energy prices. Motorists benefited from the reduction in consumption tax. VAT has been reduced for electricity and gas customers. But nothing for the 40 percent of homeowners who heat their homes with oil.
Is it a coincidence that only 6 per cent of Dubliners rely on oil for heating, compared to two thirds of rural Ireland’s residents, and that our mostly Dublin-based politicians find it easier to overlook them?
And even in the midst of the current emergency, we must be aware of the urgent need to reduce greenhouse gas emissions and achieve carbon neutrality by 2050. There are better options to address both the over-reliance on Russia as a fuel source and the climate emergency, by increasing support for domestic production of biofuels and green hydrogen, which can replace fossil fuels for transport and heating.
These steps can significantly contribute to a just transition to climate neutrality.
Kevin McPartlan is CEO of Fuels For Ireland, the organization representing companies that supply energy for transport, heating, commercial, agriculture, shipping and aviation
This article was modified on April 17, 2022
https://www.independent.ie/opinion/comment/drive-to-reduce-our-reliance-on-fossil-fuels-must-be-fair-to-those-taking-the-hit-41559997.html The quest to reduce our dependence on fossil fuels must be fair to those affected
