Ireland faces fines of €600m a year from the EU for failing to meet renewable energy targets and cutting carbon emissions by 2020.
New, more ambitious targets for 2030 do not let Ireland off the hook for the 2020 measures, it has emerged.
A report for the Dáil Public Accounts Committee, which calculated the potential fines within two years, said they will be a matter for the European Court of Justice to impose.
Irish EU Commissioner Phil Hogan said there was confusion in some quarters that the 2020 targets under the EU Renewable Energy Directive would be merged into the more ambitious targets for 2030. This would give the Government some breathing space and lessen the risk of punitive fines.
"But that is not the case. The 2020 target must be adhered to," Mr Hogan said.
The commissioner urged the Government to be more proactive in developing wind and wave energy and reduce dependence on fossil fuels in line with EU agreed targets.
Mr Hogan said he had relayed this message to Climate Action Minister Denis Naughten.
"We all know exactly that there is no free pass post-2020 in relation to the Renewable Energy Directive and we will be running into trouble with infringement proceedings if this does not happen," Mr Hogan said.
Fine Gael Senator Michelle Mulherin, who raised the issue in Seanad Éireann last week in discussions with Mr Hogan, said the Government must step up investment in renewable energy projects.
She said that a test station for wind and wave power off Belmullet, in Co Mayo, should be developed.
"Off-shore wind power has up to now often been deemed unduly expensive.
"But given the controversy and frequent objections to wind turbines on land, this issue should be re-thought," she said.
Ms Mulherin was critical of what she said was a lack of commitment to developing alternative energy in a timely fashion.