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Minister for Enterprise, Trade and Employment, Simon Coveney, today welcomed government agreement for the development and implementation of a Scheme to assist businesses which have been impacted by significant increases in the cost of kerosene heating oil.
Minister Coveney said the price of kerosene increased following Russia’s invasion of Ukraine:
"As we know, businesses have experienced unprecedented increases in energy costs over the past year. This Scheme will now ensure that businesses, who use Kerosene for heating, can claim for the increased costs of this fuel. The Scheme will complement supports for increases in gas and electricity costs that are already available under the Temporary Business Energy Support Scheme (TBESS)."
Welcoming the decision, Minister for Finance Michael McGrath said:
"I welcome the government decision to develop a scheme to support businesses dependent on kerosene as an energy source. In addition to this new scheme, I informed Government today of my intention to extend the Temporary Business Energy Support Scheme, which supports businesses that use mains gas and electricity, to 31 July 2023. This extension will help businesses, over the coming months, that have not yet seen the benefit of decreasing wholesale energy prices, and I strongly encourage businesses who have not already registered and made a claim for TBESS to do so."
Minister of State for Trade Promotion, Digital and Company Regulation Dara Calleary said the Scheme will be welcomed by small businesses:
"The businesses which are particularly impacted by kerosene increases are those not connected to the natural gas network and who use the fuel for heating purposes. I know that this Scheme will be welcomed in particular by many regionally based small and micro enterprises which aren’t connected to the network."
Minister of State for Business, Employment and Retail, Neale Richmond also reminded businesses that they can still apply for the Temporary Business Energy Support Scheme:
"Any assistance that we can give businesses to deal with rising costs is to be welcomed. This Scheme will help to support those businesses who cannot avail of natural gas, and I think it is also a timely reminder for businesses which are eligible for TBESS that there is still time to apply for that scheme and receive help with high energy costs."
The Department of Enterprise, Trade and Employment will consult with other government departments in the design of the Kerosene Scheme. The Scheme will utilise unspent Temporary Business Energy Support Scheme (TBESS) funds subject to sanction from the Minister for Public Expenditure, NDP Delivery and Reform. The Scheme will also require State Aid approval from the EU Commission. It is intended that the Scheme will be launched in Q3 this year.
As part of a review of the operation of TBESS, Government agreed that the Minister for ETE would explore options for providing a standalone Scheme to businesses that rely on Kerosene and Liquefied Petroleum Gas (LPG) as their heating energy source.
Consideration of a new Scheme was to be within the TBESS eligibility parameters.
Available data shows that the price of LPG increased by less than 20% during the reference period. Using the TBESS parameters, business would not qualify on the basis of this level of increase. It was therefore decided that the new Scheme would be for Kerosene users only.
Kerosene prices were, however, significantly higher in the reference period. Prices were, on average, €0.50 per litre higher in the 2022 reference period, a 64% increase compared to 2021.
The Scheme will be operated separately to TBESS by the Department of Enterprise, Trade and Employment, through a third party, in conjunction with Enterprise Ireland, utilising unspent TBESS funding.
Payments under the Scheme will be on the basis of a flat rate, with businesses receiving banded payments depending on their annual volume purchase of Kerosene for heating during 2022.
Claims may be made in respect of Kerosene used for heating businesses.
Companies that have received TBESS supports in respect of increased electricity and gas costs will be eligible to apply to this scheme.
Details of the scheme will be further developed following this government decision and will include, at a minimum, self-declaration that the applicant business has not already received the maximum payment under TBESS.