Electricity bills are to rise by almost €90 a year from tomorrow for more than one million households.
This is because consumers are set to be hit by a double whammy of price increases from the largest supplier and a rise on the levy on all household electricity bills on the same day.
Both Electric Ireland and PrepayPower are raising their prices, while the public service obligation (PSO) levy that supports the generation of electricity from wind power is set to shoot up by 130pc.
The combination will see almost €90 a year added to most consumers’ bills.
Higher costs come at a time when winter is closing in, while thousands of people who are forced to work from home due to the pandemic will have no choice but to use more electricity.
The country’s biggest electricity supplier with more than one million customers, Electric Ireland, is pushing up the cost of electricity by 3.4pc from October 1.
This will add around €35 a year to the average annual bill.
Customers of PrepayPower will be faced with a price rise of 2.9pc which is due to come into effect from Sunday.
Both suppliers cited increased electricity network operating costs as the main reason for the price hikes.
After the announcement of the two price rises it was feared that it would prompt a cycle of increases from their rivals.
But Bord Gáis Energy stole a march on its rivals by announcing a price increase freeze for the winter.
And Flogas has just announced it is cutting the cost of natural gas for residential gas customers by 10pc from November 1. The price cut will reduce the average standard gas bill by €78 a year, it said.
And it said it is also freezing its residential electricity prices until at least next March.
Daragh Cassidy of price comparison site Bonkers.ie said the PSO levy for last year was €38.68 a year, including Vat, but will rise to €88.80 (including Vat) for the 2020/21 period.
The Commission for Regulation of Utilities sets the levy, which is imposed on all domestic electricity customers. The 130pc rise in the PSO levy will mean it is the second highest it has been since it was introduced in 2010.
Lower wholesale energy prices meant those generating electricity from renewable such as wind need higher levels of financial supports to be viable.
Mr Cassidy said: “At a time when energy usage in the home has probably never been higher due to more of us working and socialising at home due to Covid, it’s really important that people switch supplier regularly to ensure they’re getting the very best value.”
He said businesses in this country seldom reward loyalty, and those who want to be on the best deal have to shop around regularly.
Consumers cannot presume that just because they have been with a particular supplier for several years that the supplier will return the favour with cheaper prices.
“If anything it’s the opposite. This applies to all household bills but particularly energy,” Mr Cassidy said.
Eurostat figures indicate that households in Ireland pay some of the highest electricity prices in Europe.
Energy experts warned that the Government is planning to introduce hikes in the carbon tax in the upcoming Budget.
Carbon tax applies to gas, petrol, diesel, briquettes and coal, but not on electricity.
|Wind Watch relies entirely
on User Funding