Opinion: In the middle of concerns over the cost of living, energy supply and climate change, hiking the price of using public transport does not make sense
From January of next year, public transport fares for adults in Ireland will increase by an average of 15%. Taoiseach Micheál Martin and Government TDs have defended these price hikes, outlining the need to ensure a sustainable source of funding to expand capacity and services.
While it is in generally fiscally prudent to ensure sustainable funding streams for the delivery of public services, it is ironic that the one sector in which the Government are willing to raise revenue by increasing prices is the sector where they should be doing the exact opposite. After a summer of record breaking droughts and heatwaves, the impacts of climate change have never been more salient.
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From RTÉ Radio 1’s News at One, public transport fares are set to jump by 15% from January 2026
Rising fuel and energy costs are adversely impacting households, with higher food prices also expected later this year as a result. Rather than increasing fares, reducing them would have the dual benefits of lowering transport costs for consumers and reducing carbon emissions by increasing public transport use.
There are many reasons why public transport should be subsidised. One economic argument for government invention in markets is that the market is not efficient when there are market failures in the form of externalities. These occur when the production or consumption of a good has an impact on individuals external to the market; in other words when bystanders are either positively or negatively affected.
Public transport use has many positive externalities in the form of benefits that extend beyond users to broader society. Without intervention, if the users of public transport paid the full cost of a journey, too few people would choose to travel that way. By subsidising the ticket price, the public benefit to non-users when an individual chooses this mode of transport is reflected in the lower cost to the user. This increases the numbers using public transport and leads to a more socially desirable level of use.
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From RTÉ Radio 1’s Drivetime, former Green Party leader and Minister for Transport Eamon Ryan on plans to increase the cost of using buses, trains and trams
There are multiple positive externalities associated with public transport use. First, taking a bus or train instead of driving reduces congestion on public roads, decreasing transport times for all modes of transport. Given that Dublin was the 11th most congested city in the world last year, this is a particular consideration for our capital city. Secondly, public transport use is associated with better health outcomes, increasing both physical activity and social connections. Hgher levels of use improve population health, reduce the burden on public health services, and consequently benefit everyone.
Thirdly, and perhaps most importantly, travelling by public transport has a much lower carbon footprint than travelling by a fossil fuel powered car. Compared to the emissions per km travelled by a petrol or diesel car, the average emissions per passenger on a bus are about 43% lower and almost 80% lower when travelling by train. The transport sector accounts for the second highest share of Ireland’s emissions and, with electric vehicles accounting for just 4% of the total licensed fleet this year, encouraging drivers to switch to public transport is one important avenue to reducing emissions in this sector.
Additionally, in the context of the ongoing conflict in the Middle East and resulting global energy supply shock, there are even stronger arguments to reduce public transport fares rather than increasing them. Earlier this year the International Energy Agency outlined a set of demand side measures that countries could introduce to alleviate the economic impact of rising oil prices on consumers. These included encouraging the public to shift from private cars to bus and/or rail.
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From RTÉ Radio 1’s Drivetime, what is the cost difference between using a car and public transport?
Several EU countries have reduced national or regional public transport fares and Denmark introduced a free travel scheme for those under 22. International evidence demonstrates the effectiveness of incentivising public transport, particularly in cities; for example, a 50% reduction in fares in Barcelona led to a 39% increase in use. In Ireland, the price cuts championed by the Green Party in Government in 2022 likely played a role in the increased use in subsequent years, with an additional 32 million passenger journeys on public transport in 2024 compared to 2023.
The current energy crisis has underlined how exposed Ireland is to external geopolitical risks and global energy markets. Ireland imports 80% of all energy consumed, well above the EU average level of import dependency (57%). Similarly, we depend on fossil fuels for 80% of our energy supply. But rather than focusing on measures that help to decarbonise the economy, or support households to switch to greener technologies and modes of transport, the Government have responded to the energy crisis with universal subsidies on fossil fuel use.
In 2024, prior to the current crisis, fossil fuels in Ireland were already subsidised to the tune of €4.7 billion. The cuts to excise on diesel and petrol introduced in April this year are costing in the region of an additional €100 million a month, and although the current plan is to phase them out from November, it is difficult to believe that there will be any political appetite in the depths of winter to increase fuel costs to consumers.
From Euronews, is free public transport in Europe working or just a gimmick?
While these universal supports provide temporary relief to households, they do nothing to address our costly dependence on fossil fuels. Furthermore, these universal supports simply drive up prices in the long run, so perceived benefits are only temporary. The adoption of green technologies in Ireland such as electric vehicles and solar panels are concentrated in affluent areas. To reduce the impact of future energy shocks and ensure lower less volatile energy costs in the long run, lower income households need targeted supports to enable them to switch to EVs and decarbonise their homes.
More immediately though, encouraging more people to use public transport would be a start, but increasing fares is likely to do the opposite. In a climate emergency, subsidising fossil fuels while increasing public transport fares is akin to Nero fiddling while Rome burns. Except this time, as we saw this summer, it is not just Rome burning; it’s most of Europe.
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The views expressed here are those of the author and do not represent or reflect the views of RTÉ
