Ryan advises customers to save money by leaving ESB
Published 02/09/2010 | 05:00
THE minister in charge of energy told consumers yesterday to leave semi-state ESB if they want to save money on their electricity bills.
Eamon Ryan advised customers to move from the ESB to a private firm such as Airtricity, or another semi-state operator Bord Gais, if they want to make "immediate savings".
It marks the first time a minister has joined other consumer groups in actively encouraging households to seek out the best value.
All three companies are fiercely competing for new and returning electricity customers by offering them competitive packages.
The minister's comments came as ESB last night confirmed a 5pc hike in electricity bills from next month.
The increase is as a result of the controversial reintroduction of the Public Service Obligation (PSO) levy from October 1, which will increase average bills by €2.73 per customer each month.
But the ESB stressed there will be no further changes to its prices from October.
The average ESB customer pays around €1,000 a year for electricity. Over the last two years, the ESB's prices have reduced by 12pc. Even with the PSO, there is still an overall reduction of 7pc, Mr Ryan said.
However, by switching to Bord Gais and Airtricity, customers can save between 10pc and 14pc, the minister added.
"I would encourage customers to switch to Airtricity and Bord Gais to make immediate savings on their electricity bills.
"Energy prices in general have reduced significantly under this Government and people should know the facts and choose the best option for them," Mr Ryan said.
A spokesperson for the ESB said last night: "We welcome competition and look forward to full market deregulation."
The minister's comments follow weeks of controversy over the reintroduction of the PSO which is being used to offset costs faced by electricity producers who are obliged to buy a proportion of renewable and peat-generated electricity.
The announcement of the levy earlier this month came amid reports the ESB has been cutting off 900 homes a month -- doubling the number cut off last year.
But the Commission for Energy Regulation last night claimed the figures concerned the number of disconnection notices issued -- and not the number of disconnections undertaken.
The number actually being disconnected is only around half because some households pay up and others are spared on compassionate grounds, it claimed.
The introduction of the PSO levy has been slammed by opposition parties, some Fianna Fail TDs, and numerous consumer groups, who argue it will put huge pressure on already struggling small businesses and low-income households.
But Mr Ryan has insisted the levy is not a new charge or a new tax.
At a special sitting of the Oireachtas Committee on Economic Regulatory Affairs to debate the controversial levy, energy regulator Michael Tutty claimed postponing the levy was not the answer to the problem.
"Postponing it just means that it has to be paid next year, or the year after," he told a special sitting of the Oireachtas
The emergency meeting was called after it emerged last month that the PSO would come into effect and hike householders' bills by 5pc.
The energy regulator said he had no control over the PSO levy and was simply implementing the Government's legislation and calculating what's required.
The contracts on the PSO were entered into between the Government and the industry.
"It's not within our control to postpone it. Even if it were, it is only postponing the problem to the future," Mr Tutty told government and opposition TDs. "It is a contractual obligation that they should get this money."