Farm Ireland

Monday 18 December 2017

Dairymen to be hit by electricity rises

Declan O'Brien

Declan O'Brien

Thousands of dairy farmers face major hikes in their electricity bills following a series of recent price increases by all the main electricity suppliers.

A 14.8pc rise in electricity charges by ESB, which came into force last month, will cost milk suppliers with a 100-cow herd an additional €480 a year on average, while those with a 60-cow herd will pay €290 more.

The move by ESB follows the decision by Bord Gáis and Airtricity to lift prices by 12pc.

The latest price increases have been blamed on higher gas prices, which is the main energy source for electricity power plants.

A spokesman for ESB said gas prices had increased by 40pc since late last year, and that these higher costs were now being reflected in electricity charges.


While forward gas prices have fallen back from the peak levels hit this summer, he claimed the underlying trend in the market was upward.

He saidESB prices would increase by 12pc as the Government levy for using energy from renewable sources -- the PSO levy -- had fallen from 4.8pc to 2pc.

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Ireland is among the dearer countries in Europe for domestic electricity charges, with Eurostat data showing that the average Irish price for the second half of last year was 12pc higher than the EU average.

The Irish charge stood at 16.52c/kWh (excluding VAT), compared to an EU average of 14.71c/kWh (excluding VAT).

The latest increase will push Ireland further out of sync with the rest of Europe due to our heavier dependence on gas for electricity generation.

However, for heavier users of electricity, such as dairy farmers, Irish electricity costs are closer to the EU norm.

For users of up to 15,000kWh electricity -- which would include dairy farmers with around 80 cows -- the average Irish cost for the second half of last year was 14.83c/kWh (excluding VAT), just 5pc higher than the EU average.

Provisional figures for the first half of 2011 show that the average Irish price fell to 13.92c/kWh (excluding VAT). However, this will jump to 15.59c/kWh (excluding VAT) when the new pricing structure is taken into account.

This is well above the average UK price for the first half of this year, which stood at 12.07c/kWh (excluding VAT), although lower than the Danish and Dutch prices, which were 20.32c/kWh (excluding VAT) and 17.55c/kWh (excluding VAT) respectively.

ESB remains the main player in the supply of domestic electricity, with a 58pc market share.

Energy efficiency will be among the topics discussed at next week's Teagasc National Dairy Conference, which takes place in the Rochestown Park Hotel in Cork on Tuesday and in the Hodson Bay Hotel in Athlone on Wednesday.

Teagasc researcher John Upton will present the findings of the Dairyman project, which recorded electricity usage on 21 dairy herds across a 12-month period.

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