independent

Saturday 19 April 2014

Gas and electricity prices up €450 -- and more hikes on way

Gas and electricity prices are set to be hiked

FAMILIES are paying more than €450 a year extra for their gas and electricity compared with just two years ago -- and further hikes are on the way.

Startling new figures show the increasing pressure households face to meet mounting energy bills, with gas prices up 35pc and electricity up 21pc since 2011 -- a period when average earnings fell.

And further price hikes are on the way this month and next, as Electric Ireland plans a 1.7pc increase, while Bord Gais is also expected to raise prices by 2pc.

Experts have warned that average heating and power costs will increase in the short-term unless we have a mild winter or tap into new sources of energy, including renewables.

Bord Gais power and gas trader John Heffernan said its Energy Index showed a sharp rise, and that a long, prolonged winter would fuel further hikes.

However, if it is mild, it means there will be more stock of gas coming into the spring, meaning less will have to be purchased for winter 2014.

MOTORISTS

But it's not only householders affected by the surge in prices. There is no respite for motorists, with diesel and petrol at garage forecourts rising almost 10pc over the past two years.

An analysis of average household bills carried out by independent price comparison website bonkers.ie shows the extent to which families are being squeezed as global prices rocket. The figures are based on average household use of 5,300kWh a year of electricity and 13,800kWh a year of gas.

Prices include the carbon tax and other taxes and levies where applicable. Electric Ireland and Bord Gais standard rates have been used, as they provide power to most domestic customers.

The figures show:

* Gas prices have risen by 35pc since 2011, and electricity by 21pc.

* The average price paid for electricity is now €1,195 and €980 for gas -- a total of €2,175.

* In 2011, the figure stood at €1,717, resulting in an average rise of €458.

* Figures from the AA also show stiff increases in fuel prices. In January 2011, a litre of unleaded was 142.6 cent but it rose to 154 cent (up 8pc).

* Diesel has also risen from 135.2 to 148, a rise of 9.5pc.

The hikes come despite falling average weekly earnings, which dropped to €675.33 in the third quarter of 2013 compared with €687.67 two years previously.

A series of price increases has prompted the Dail Transport and Communications committee to call in the Commission for Energy Regulation (CER) to explain the rationale for sanction price hikes.

A CER spokesman said the gas market was expected to be deregulated shortly, which would mean Bord Gais could set its own prices.

"The key driver of customer prices are the international gas price and network charges. Competition helps reduce prices," he said.

The International Energy Agency says the price of oil has averaged $110 (€81) per barrel since 2011, "a sustained period of high oil prices that is without parallel in oil market history".

Irish Independent

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