Dairy farms face huge price hike in electricity bills

It comes as industry sources warn of looming “blackouts” with plans already in motion to distribute power generators to some communities.

A well-informed source said: “The Irish Government has been very meek and obscure in alerting people to what is actually happening. Our electricity costs didn’t really alter by 10pc in the last decade, but in the last three-to-five months it has gotten out of hand.

“The cost today might be completely changed tomorrow, it’s going up that fast.”

The contributing factors are fourfold, the industry insider said.

“Russia is turning off its gas taps to Europe for their own localised political principles, there is a surge in worldwide demand for energy, and that’s followed by our own domestic issues where so many peatlands have been closed off.

“Power plants in Lanesborough, Moneypoint and Ringsend gas in Dublin are inoperable which is causing a lull in the production of electricity. Plus, our wind turbines have produced 15pc less electricity this year.”

While the range in energy bills on dairy farms is significant – anything from €2.50 to €9 per tonne of milk sold according to recent Teagasc figures – the following scenario was outlined for a farmer milking 150 cows and paying at a rate of 16c/kilo-watt hour.

“A dairy farmer milking 150 cows with a meter dedicated just to the farm, not to the house, is now facing a bill of about €1,200 every two months.

“Most dairy farmers are domestic users, but even if they switch to commercial it won’t make a difference because all rates are going up across the board.

“Blackouts are likely. I know of communities already told that they will be getting generators. I’ve never witnessed anything like this before,” the source concluded.

Independent TD Michael Fitzmaurice said emergency generators could cost up to €200 million and added that “ironically” such devices are powered by gas or diesel.

“In a mad stampede to move to renewable electricity generation, this country has neglected the upkeep of a reliable back-up for power generation.

“We are facing potential blackouts due to the path we are taking. The Government was unable or unwilling to bring in legislation when it mattered to allow the power plants in Lanesborough and Shannonbridge to continue for another few short years.

“Pair this with decisions not to allow further oil or gas exploration, or the extension of the gas pipeline infrastructure, it leaves Ireland extremely vulnerable."

Shane O’Loughlin, Chairperson of ICMSA’s Farm Business Committee, said that the organisation is monitoring the situation around a predicted surge in energy prices carefully.

He said that the situation underlined ICMSA’s argument for more energy efficient equipment to be prioritised under TAMS.

“In terms of electricity consumption per dairy cow milked, the figures vary from 4 kWh/cow/week to 7.3 kWh/cow/week. Assuming 18c per kWh, each cow is costing between €37 and €68 per year. For an 80-cow herd, this could be up to €5,400 per annum.

"If electricity prices rise by 20pc, that band moves proportionately to between €44 and €82 and gives that same farmer an electricity bill of €6,500 per annum. That’s a massive input cost the farmers will be expected to bear.

“There are proven methods of reducing energy consumption, such as using a variable speed-drive controller on vacuum pumps. This can save over 60pc on vacuum pump running costs.

“We’d also recommend looking at energy efficient lighting and anything else that reduces running costs while lowering emissions.

"But there is a growing capital installation cost and we want anything that meets these twin objectives of reducing energy consumption and lowering emissions to be prioritised for TAMS funding,” O’Loughlin said.