Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I announced in the Budget that a carbon tax at a rate of €15 per tonne is being introduced on fossil fuels. The tax was applied to petrol and auto-diesel with effect from midnight, 9 December 2009; and applied from 1 May 2010 to kerosene, marked gas oil (also known as 'green diesel' or 'agricultural diesel'), liquid petroleum gas (LPG), fuel oil and natural gas. The application of the tax to coal and commercial peat is subject to a Commencement Order.

A full relief from the carbon tax applies to EU Emissions Trading System (ETS) installations in the powergen sector, but ETS installations in other sectors will be required to comply with EU minimum excise rates applying to the fuel in question. However, there is no EU minimum excise rate in the case of peat. Solid fuels, including commercial peat, as indicated above are subject to a commencement order; this is to allow time for issues such as fuel poverty and the sourcing of coal of a lower environmental standard from Northern Ireland to be addressed.

A number of Government Departments, including the Department of Finance are exploring options for how best to offset the impact of the carbon tax on low-income households. With regard to the sourcing of coal from Northern Ireland, work has already commenced on this matter within the Department of Environment, Heritage and Local Government. In addition, the Department of Environment, my Department and the Revenue Commissioners have met with the Solid Fuel Trade Group in this regard.