Ibec unveils €40bn blueprint for low carbon economy within 30 years

The transformation to a low-carbon economy will require €40 billion of capital investment in the Republic over the next 30 years, according to a strategy document from employers group Ibec.

The lobby group’s new climate strategy includes measures such as increasing forest cover by 64 per cent, cutting emissions from power generation by as much as 92 per cent, building more public transport, and overhauling carbon tax.

Ibec also wants to revive a climate action-focused version of the social partnership model that was used to facilitate agreement on matters during the last boom between the State, trade unions, business and other society groups.

The recommendations are contained within the Ibec report: Building a low carbon economy: a roadmap for a sustainable Ireland in 2050.

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The 76-page document wants the State and business to implement green measures to “decouple” economic growth from increasing carbon emissions.

‘Carbon leakage’

It also warns, however, that the State will need to protect against “carbon leakage”, where businesses move production from Ireland to other potentially less efficient countries to escape green measures brought in by the Government.

Fergal O’Brien, Ibec’s director of policy and its chief economist, said the plan, which took more than a year to develop, was not an attempt by the business lobby group to “greenwash” on behalf of its members.

“This is not about business being seen to do something. The business sector has bought into the topic,” he said.

One of the centrepieces of Ibec’s strategy is to increase the carbon tax from €20 to €30 per tonne in Budget 2020, and to increase it thereafter by €5 per tonne annually until it reaches €80 in 2030.

It wants the proceeds of the tax ringfenced to pay for green measures such as the retrofitting of buildings and the development of new technologies. Ibec argues that the damaging effect of the extra taxes on the poorest sections of society could be partially offset by increasing State fuel allowance payments.

Conor Minogue, the author of the report and Ibec's senior energy executive, said a gradual and well-flagged increase in the carbon tax would be better than the "shock" of a large, quick increase aimed at changing behaviour quickly.

The plan envisages that with inevitable population growth and economic expansion, it will not be possible to reduce the gross carbon emissions of the agriculture sector and food production.

Greater efficiency

Rather, the employers group argues that emissions from the sector can be contained at current levels as food production expands, by encouraging greater efficiency on farms and planting more forests and hedgerows, and facilitating more natural wetlands.

With the emission reductions envisaged in the plan in the energy, industrial and transport sectors, containing agriculture’s emissions at existing levels would increase their share of overall emissions from 33 per cent to 75 per cent.

Peat and coal-fuelled energy production would cease under the plan, while oil-fuelled activity would be restricted to aviation, heavy vehicles and other sectors with no alternatives.

Ibec also wants planners to facilitate more “compact” urban development to promote more walking and cycling.

“Ireland in 2050 will have a smart low carbon economy known for its sustainable enterprise base, industrial competitiveness, energy resilience, skilled workforce, and high quality of life,” said Ibec.