Green transition

The Finance (No.2) Bill 2026 gives effect to several Budget announcements relevant to Ireland’s green transition. The measures are targeted rather than broad: they increase the income tax exemption for household renewable electricity, extend a temporary enhancement to the Diesel Rebate Scheme and adjust the timing or level of a number of carbon-related taxes.

For households and businesses, the practical significance lies in timing and cash flow. The package offers additional support in selected areas while postponing some planned carbon tax increases.

It therefore provides near-term relief, but it does not remove the need for taxpayers and operators to understand when revised rates apply and how the measures interact with their own energy and transport decisions.

Transport operators and the Diesel Rebate Scheme

The Bill extends the temporary enhancement to the Diesel Rebate Scheme until 31 December 2026. The scheme, provided for in Finance Act 1999, gives qualifying road transport operators partial relief from Mineral Oil Tax on auto diesel.

Temporary changes introduced by the Finance Act 2026 increased the maximum repayment rate under the Diesel Rebate Scheme from €75 to €120 per 1,000 litres for auto diesel purchased by qualifying operators between 1 January and 30 September 2026.

The Finance (No.2) Bill 2026 extends that enhanced treatment for purchases through the final quarter of 2026, i.e., to 31 December 2026.

For qualifying operators, the extension may support short-term cost management by preserving the higher maximum repayment rate for an additional three months. The benefit is time-limited, so purchasing dates and eligibility remain important.

Businesses should ensure that their internal fuel records and claims processes can identify qualifying purchases made up to 31 December 2026.

This measure also illustrates a tension within the wider green transition policy; road transport businesses face pressure to manage energy costs, while carbon policy is intended to influence longer-term behaviour.

Extending the Diesel Rebate Scheme enhancement provides short-term support to qualifying operators, but it does not establish the treatment that will apply after 2026. Operators should therefore avoid treating the temporary rate as a permanent feature when budgeting beyond the extension period.

Natural gas and solid fuel carbon taxes

The Bill confirms the amended Natural Gas Carbon Tax rate introduced by a Financial Resolution passed on Budget Day. The applicable rate is €8.77 per megawatt hour. It also postpones the increases that were due to apply to Solid Fuel Carbon Tax until 1 May 2027.

Taken together, these provisions may ease some immediate energy-cost pressure, but again they should not be viewed as permanent reliefs given the overall policy intent to influence longer-term consumer behaviour.