Sustainability
Budget 2026
Key measures
Budget 2026 marks a strengthening of Ireland’s resolve towards green transition and embedding sustainability, particularly environmental sustainability, into the core of national investment planning. The Government has allocated €1.1 billion to the Department of Climate, Energy and the Environment, including €558 million in carbon-tax revenue for residential and community energy upgrades. A further €3.5 billion will go to ESB and EirGrid to strengthen the electricity grid and accelerate renewable energy expansion. In the water sector, €1.4 billion is being provided to Uisce Éireann to expand capacity, improve wastewater treatment, and enhance the resilience of supply—critical for both housing and climate adaptation. Transport remains a major focus, with €4.7 billion allocated to sustainable mobility projects including DART+, BusConnects, and the Cork Commuter Rail, alongside €2 billion for MetroLink. The agriculture sector receives €280 million under the Agri-Climate Rural Environment Scheme (ACRES).
Who will be affected?
Budget 2026 affects a broad cross-section of society, from homeowners and farmers to businesses and local communities. Overall, the budget sets in motion a whole-of-economy transition that will touch nearly every sector, rewarding those who invest early in sustainable practices.
What now?
Most of the funding measures will be delivered as part of the National Development Plan. Departments are expected to publish investment plans in the coming weeks, outlining specific projects and eligibility details.
Our view
The Government is continuing to embed climate and environmental goals into wider fiscal policy. The integration of carbon-tax revenue into sustainability programmes demonstrates a credible link between taxation, transition, and tangible public benefit. The overall success of the increase in spending will depend on the delivery and accountability of the various departments and projects which have received the increased funding. Infrastructure bottlenecks, complex planning processes, and skills shortages have previously slowed climate progress. The Budget recognises this and is attempting to alleviate these hurdles, not just through funding, but also the welcome announcement that there will be a detailed action plan published to reduce the complexity in getting these important sustainable infrastructure projects built. This has long been seen as a major obstacle not just domestically but also for foreign investors who will look to assist in building these vital projects. By investing in renewable energy, water resilience, and sustainable transport, the Government is laying the groundwork for the country’s sustainable growth.
The Minister referenced Ardnacrusha as a pivotal moment in our country’s national development, positioning today’s announcements as a modern continuation of that legacy. Ambition alone will not secure such a legacy for future generations, the real test will come as details emerge of how the announced funding will be deployed and to a much larger extent the delivery of projects over the coming years. Until then, the vision outlined in this Budget remains just that – a vision.
