€3bn Climate and Nature Fund Earmarked Budget 2024
Éire / Ireland
In Budget 2024, the Minister for Finance, Michael McGrath, has introduced several climate-related tax measures to promote sustainability and energy efficiency. These measures encompass various aspects of green initiatives, from incentivizing micro-generation of electricity to supporting the adoption of electric vehicles.
Accelerated Capital Allowances Scheme:
- Extended for two more years to promote the use of energy-efficient equipment.
Micro-generation of Electricity:
- Tax disregard doubled for households selling surplus electricity back to the grid.
- An income disregard of up to €400/year introduced from January 1, 2024, providing relief from income tax, USC, and PRSI.
- VAT rate reduction to zero for private dwellings extended to schools starting January 1, 2024.
Battery Electric Vehicles (BEVs):
- VRT relief extended until the end of 2025, benefiting BEVs valued up to €50,000.
Carbon Tax Increase:
- CO2 emission rate for petrol and diesel raised from €48.50 to €56.00/tonne from October 11, aligning with the trajectory set in the Finance Act 2020.
- All revenue generated will be allocated towards shielding vulnerable groups from unintended impacts of the tax hike, funding a socially progressive national retrofitting initiative, and providing support for farmers transitioning towards sustainable practices.
Residential and Community Energy Schemes:
- Budget allocates a substantial €380 million to these schemes, aiming to reduce greenhouse gas emissions and lower energy costs.
Renewable Energy Target:
- The budget allocates resources to support the goal of meeting 80% of Irish electricity needs from renewable sources by 2030.
Low-Interest Loan Scheme:
- Introduced alongside Sustainable Energy Authority of Ireland grants, facilitating broader access to energy-saving opportunities.
Carbon Tax Revenue Allocation:
- An additional €165 million from Carbon Tax revenues will be available in 2024 to support a just transition and address fuel poverty.
- Total available for investment reaches €788 million, with almost half (€380 million) dedicated to enhancing home energy efficiency.
Social Protection and Agriculture Funding:
- €262 million from Carbon Tax revenue directed towards Social Protection.
- An extra €32 million allocated to the Department of Agriculture, Food, and the Marine to assist up to 50,000 farmers in improving biodiversity, climate, air, and water quality outcomes.