Watchdog hits out at renewable energy levy
Published 09/08/2010 | 05:00
A row has erupted over government plans to hit consumers with an electricity levy of more than €30 a year to fund green energy.
Consumer watchdogs warned the Government that cash-strapped consumers would "not take the new charge lightly", just days after if emerged that electricity bills were set to rise.
The Commission for Energy Regulation has ordered suppliers, including the ESB and Bord Gais, to levy customers with an annual charge that will be used to subsidise the higher cost of generating power from wind energy and peat.
It will result in householders paying an extra €32.76 a year on their bills, while small and medium-sized businesses will be hit with a €99.03 charge.
Bigger business customers will pay based on the amount of power used.
Consumers' Association of Ireland chief Dermott Jewell said the Government was "overlooking the reality" for consumers who were already struggling with the cost of living.
He said it should explain how much cheaper consumers could expect energy to become in future as a result of paying the levy, and when.
"The timing couldn't be worse," he said.
"It would have made perfect sense to delay this to show solidarity with householders who are doing their best to control their budgets.
"It may not be a huge amount of money but that's not the point, it's just another charge on top of many others and it's going to be hard for some people to manage.
"This is not going to be accepted with goodwill by consumers."
Fine Gael energy spokesman Leo Varadkar said the news that electricity prices are due to rise from October would come as a shock to hard-pressed consumers and businesses.
"The levy is particularly unfair to. . . low-paid and elderly people as it is imposed as a flat rate on all domestic consumers, regardless of how much energy they use," he said.
The ESB, he added, reported profits of €500m last week and would benefit most. The ESB said it was required by law to pass the charge on to consumers.
The move is designed to raise €156m to offset the higher costs of producing fuel from sources other than oil, coal and gas.
The Department of Energy, Communications and Natural Resources said that the levy, first introduced in 1999, was low during periods when fossil fuel prices were high and was needed to increase the amount of renewable energy being generated, which would lead to lower bills in the long-term.