The State could transform itself “from climate laggard to climate leader”, according to a new report, which highlights Irish potential to champion green investment in the post-pandemic era.
The study by Octavian Research for the National Economic and Social Council (NESC) claims that the world is set for a massive transition to renewable energy and for a climate-based recovery from the Covid-19 crisis and that Ireland is uniquely placed to capitalise on this.
While acknowledging that Ireland’s current reputation for combating climate change is poor and that state investment in renewable energy has been weak, it says the Covid-19 crisis and a new global push to tackle the climate crisis provides a chance to “reset”.
The election of Joe Biden, a strong climate advocate, in the US and Washington's likely re-engagement with the Paris climate accord feeds into this, it says.
Ireland’s growing public investment budget; the State’s new climate legislation; and a commitment in the Programme for Government to attach financial conditionality to investment can accelerate the shift to a zero-carbon economy at home, the report notes.
Another key advantage is the level foreign direct investment that Ireland commands. The €162 billion invested in the Irish economy last year amounted to 5.3 per cent of the EU27 total and was five times higher than Ireland’s EU population share.
This share of investment enables Ireland “to make a disproportionately large contribution to annual financial investments needed to reach Paris targets,” it says.
It also highlights the rising prominence of climate change and sustainable finance on the EU and UN agendas and the key positions and portfolios in these institutions that Ireland now holds.
Ireland currently holds the EU Commission's financial services portfolio, the European Central Bank's chief economist position and the Eurogroup presidency, while earlier this year it was co-opted onto the UN's Security Council.
“Ireland’s opportunity to assist (via influence in the UN, EU and other fora) renewed multilateral engagement on sustainability should not be marred by [the State’s] climate target underperformance,” the report says.
“Rather the former should be embraced as an opportunity to intervene at a unique, decisive moment in world history and as a catalyst to domestic policy change,” it says.
Author Marc Coleman said strong public finances provide Ireland with an opportunity "to correct a lot of domestic mistakes by requiring greater sustainability in public investment".
“We have a once-in-lifetime chance to influence progress on a global scale on green finance conditionality. We can transform global financial markets towards more green friendly investment,” he said.
A separate report this week suggests Ireland continues to be among the worst of the world’s developed countries when it comes to responding the climate crisis.
According to the 2020 Climate Change Performance Index (CCPI), Ireland was ranked 39th out of 57 at delivering on decarbonisation commitments.