The ESB and Cement Roadstone Holdings are the biggest beneficiaries of a draft allocation plan for carbon dioxide (CO2) emissions published yesterday by the Environmental Protection Agency (EPA).
Electricity generation accounts for two-thirds of the available national allowances - set at 22.5 million tonnes - for an EU carbon trading regime due to start on January 1st next with the aim of reducing emissions.
Critics immediately warned that ordinary taxpayers would be left to foot the bill, likely to be at least €300 million a year, for Ireland's continuing failure to achieve its target under the Kyoto Protocol on Climate Change.
The ESB's total allocation exceeds 11 million tonnes per annum, while a further 2.7 million tonnes has been allocated to independent electricity generators such as Huntstown Power, near Mulhuddart, in northwest Dublin. The coal-fired power plant at Moneypoint, on the Shannon Estuary, has been allocated 4.4 million tonnes of CO2 for each of the next three years, though this is less than its recent annual emissions of 5.9 million tonnes. Underlining the carbon-intensive nature of traditional cement production, Cement Roadstone Holdings' is being permitted to emit nearly 2.4 million tonnes of CO2 from its four plants, the largest one at Platin, near Drogheda.
Two other traditional cement manufacturers, Quinn Cement near Ballyconnell, Co Cavan, and Lagan Cement, near Kinnegad, Co Westmeath, have been given allowances of 849,000 tonnes and 374,000 tonnes respectively.
Mr Donal O'Riain, group managing director of Ecocem, which manufactures cement without emitting CO2, said any burden on the economy could be significantly reduced by using more "environmentally friendly cement".
The EPA's allowances are in line with a recent announcement by the Minister for the Environment, Mr Cullen, that the Government had decided to give the industrial sector free CO2 allowances equivalent to its current emissions. The draft National Allocation Plan published yesterday sets out the EPA's proposals for distributing these allowances, based on what it described as a "robust analysis" of the various sectors and installations included.
This analysis, carried out by Indecon economic consultants and ENVIROS consulting, focused both on CO2 emissions and also on the costs faced by participants in making the reductions required to meet the terms of the Kyoto protocol.
Dr Mary Kelly, EPA's director general, said full recognition had been given to the role of renewables in electricity generation and there would also be dedicated allowances for more efficient combined heat and power (CHP) plants. "Global warming is a long-term problem that requires a long term strategic global response. The allocation process proposed by the EPA will reduce harmful emissions by establishing a price for carbon dioxide," she said.
It would also help to reduce CO2 emissions by encouraging the development of renewable energy and CHP and by making processes which emit large amounts of carbon dioxide "prohibitively expensive".
The EU directive on compliance with Kyoto targets requires that companies be issued with a cap on the amount of CO2 they are allowed to emit; if this is exceeded, they would have to purchase allowances from others.
Friends of the Irish Environment said the draft plan had merely confirmed the Government's intention to allocate free emissions trading rights to industry while funding part of the shortfall by purchasing emission credits with taxpayers' money.
