The Irish Times tells us that the proposed new bridge at Killaloe will be built. The preferred route would cross the canal at Moys, below the breach in the wall, and, on the Tipperary side, feed into the existing roundabout at the junction of the R494 and R496.
The Preliminary Design Report for the project said:
There is an existing canal alongside the river on the west side, which served a navigational function up to the time of the construction of the Parteen Weir and the raising of the water level in the river. The canal is now inundated by the river as a result of the raising of the water level, and now merely forms a parallel channel alongside the river. A strip of land some 25m wide separates the river from the canal, which is approximately 10m to 12m wide at the bridge site. As the river is now fully navigable, the canal serves no navigational function except that recreational vessels wishing to access properties on the western shore can only do so by entering the canal through certain access points, and travelling along the canal to their desired destination on the shore.
It seems that Waterways Ireland (god bless ’em) insisted that the canal remain navigable:
[…] Waterways Ireland have now requested that passage along the canal be retained, and have advised that they intend to refurbish the canal as a recreational amenity.
A culvert is therefore to be built over the canal, but not a low-level culvert:
[…] Waterways Ireland require that the structure provide a minimum of an 8 metre wide waterway with a 4 metre wide towpath for vehicle and pedestrian access. They require the provision of a minimum headroom of 3.86 metres above normal water level, and a bed level not higher than the downstream cill of the canal lock at Killaloe/Ballina Bridge.
The section of canal will be dewatered during construction work.
These quotations are from Shannon Bridge Crossing Preliminary Design Report Rev F01 by RPS Consulting Engineers in October 2006. I am unable to find, on the Clare County Council website, any later documents that might assure me that the canal crossing provisions still apply. That’s not to say that they don’t; it may just be that the Council doesn’t think citizens need up-to-date information on the matter.
Irish waterways history 
this canal was cleared of fallen trees and submerged trees by local fishing club(boat shed at Moys) so that fishing boats can use it when going upstream in very windy conditions as there can be very big waves coming into the bottleneck
Hi, Bill: that was quick! [Is that Bill Hickey of Mayfly?] I was along the canal a few years ago in a small boat: there were one or two trees down but it was a remarkably easy passage nonetheless, and fascinating to see the top of the old lock just above the water. Glad to hear the club keeps it clear. bjg
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Hmmm…beware of that “culvert” refernence lads. According to a recent comment on an IWAI Forum thread, a culvert is a bridge of less than 6 feet.
M
Waterways Ireland made its wishes explicit:
That said, I have not checked to see whether the actual plans implement that desire, although I imagine WI will have checked. bjg