Less than six months after the introduction of a carbon levy, Irish producers are to be hit by a second energy surcharge, a five per cent electricity levy taking effect next month.
According to Green Party minister Eamon Ryan, the new charge is to help pay for the development of renewable energy and to provide security of supply. But the fresh produce sector, already struggling with the recession and high production costs, claims it will threaten jobs and livelihoods and boost imports.
Matthew Wallace, chairman of the Quality Green producers’ group, with members in Dublin, Waterford, Wexford and Louth, fears it could be the final straw that forces some growers out of business. His group supplies tomatoes, cucumbers and peppers to the main supermarket chains and has successfully grown the sunstream and piccolo tomato varieties that were previously imported from the Netherlands and Italy.
“How are we to improve competitiveness and displace imports when our costs keep on rising?”, he asks. “Energy and labour are our two major concerns. Our minimum wage is the second highest in the EU and our electricity charges the third highest, so how can anyone seek to justify this latest levy? It’s simply a tax on production.”
One of the Republic’s largest companies, Keelings, hard hit by the carbon levy, will be less affected by the latest surcharge as its operations are fuelled mainly by natural gas. It declined to comment on the impact of the higher costs, but Matthew Foley, a major tomato producer in north county Dublin, had no such reservations.
“The government is simply handing the market over to importers by making it impossible for local growers to compete,” he said. “The carbon levy will cost me €34,000 in a full year - and now I have meet an electricy levy as well. It’s madness.” In parliament, opposition members called for postponement of the levy, describing it as “bad for business and competitiveness”, but the minister insists it must go ahead.
