Beat green tax and rising energy bills by switching and using less
As households face a 30pc hike in renewable levy, there's no better time to take action - a two-pronged approach will work wonders, writes John Cradden
Households across Ireland have become somewhat accustomed to mostly small but incremental increases in the cost of electricity over the last few years, but get quite a shock with the arrival of your next bill.
That's because the energy regulator has approved a massive 30pc hike in the 'green' levy on domestic energy bills that is used to cover the costs of producing renewable energy. Called the PSO levy, the increase will raise this annual tax by €25 to €104.50 from October 1.
The levy is used to subsidise the production of electricity from peat, renewables and to pay power plants to produce energy to ensure we have a steady supply to the network.
Granted, many of us will find it harder to argue with the fact that every effort should be made to encourage suppliers to switch to more renewable energy. So if you find your electricity bills already a little too hard on the pocket, maybe it's time to fight back by looking at ways to 'green' your own consumption. This should also be in conjunction with efforts to look for the best value tariff, so that you are not paying any more for your electricity than you need to.
With the average electricity bill in Ireland at about €950 a year, Eoin Clarke of price comparison site Switcher.ie is a one advocate of this two-pronged approach, but adds that the single biggest way to save money is to switch to a tariff with a cheaper unit rate or a big introductory discount.
"There are savings of up to €318 available for customers switching from standard gas and electricity plans to the cheapest deals on the market, so taking a few minutes to compare deals and switch can make a huge difference."
However, last month both SSE Airtricity and Energia launched new dual fuel tariffs (ie both electricity and gas from the same supplier) could save customers up to €298 when compared to standard tariffs.
"Some people might want to opt for dual fuel tariffs out of convenience, as they'll just be dealing with one supplier on any queries etc" said Clarke, who adds that to avail of the biggest discounts from suppliers, you will need to sign up to pay by direct debit and to receive online bills.
At the moment, Energia comes out tops for dual fuel deals with its Cheapest Dual Fuel 29/28 tariff, which it estimates will save you nearly €300 compared to standard tariffs based on national average consumption.
There are also some heavily discounted electricity-only plans on the market at the moment, as well as some plans that have lower discounts but which offer cashback in the form of account credit for new customers signing up.
"Customers will need to decide if they would prefer lower bills on an ongoing basis, or if cashback or account credit is worth more to them, especially if they can offset this credit against a bill at an expensive time of year, like Christmas or back-to-school time," said Clarke.
For what it's worth, Switcher's top pick for both discounted deals and deals with cashback is Energia's Cheapest Electricity (33pc discount), which it estimates will save you up to €176.78 when compared to standard tariffs in the first year, after which you'll inevitably need to sign up for another discounted deal again in order not to be shifted back onto the more expensive standard tariff.
"Once you switch, take a note of the date and set a reminder to shop around again at the same time next year," said Clarke. "Most discounts only last for 12 months, so switching every year is the only way to ensure you're never overpaying on your energy bills."
However, according to Commission for Energy Regulation, there has been a rise in the number of customers re-negotiating with their current suppliers rather than switch to a different supplier.
In fact, at the current rate of growth, the number of customers renegotiating looks set to outstrip those who switch for a better deal. In the first quarter of this year, 69,533 customers renegotiated compared with the 77,681 who switched, an increase of over 27,000 on the third quarter of last year.
However, the term 'renegotiations' might imply that folks are independently picking up the phone and playing hard-ball with a customer representative, but in reality, it's mostly the other way round. Suppliers are pro-actively ringing up customers coming to the end of a discounted deal period and asking if they want to be transferred to a new deal rather than be automatically switched back to a standard tariff.
CER spokesman Karl Richardson said that more suppliers are doing this simply because its far cheaper for them to retain existing customers than win over new ones.
In terms of ways to comfortably reduce your consumption of electricity, there are a whole range of measures you can take, ranging from small things moderating the use of your kettle to buying more energy-efficient appliances.
Some of these measures are old chestnuts, such as choosing low-energy light-bulbs, only filling the kettle with as much water as you need, powering off major appliances rather than keeping them on standby (said to knock off 20pc of their electricity use, in fairness) and keeping your immersion tank well insulated (which will reduce water heating costs by 30pc).
But price comparison site Bonkers.ie also recommends using your dishwasher (albeit a fairly modern, energy efficient one) as much as possible on the grounds that it is far more efficient at the job of washing dishes than you are. "In fact, a full dishwasher uses less than half the energy you do when washing dishes by hand and uses gallons less water too."
There's also the option of getting a Nightsaver meter, which ESB will install for free, and if you can shift more than 20pc of your electricity usage to the night time, You'll pay a little more for your daytime unit rates and your standing charge will be a little higher, but if you use more than 20pc at night you'll rack up the savings.
If you're not sure which gadgets in your home are the most power hungry, there are little, inexpensive gadgets you can buy which that clip onto the mains cable at your meter or you can invest in a wireless one, such as the Owl Micro Plus, which costs €55.
It's worth noting as well that, following a review last year, the CER recently revised its typical average annual consumption values that helps people compare prices, tariffs and suppliers.
Before, it estimated that the national average domestic consumption of electricity was 5,300 kWh a year (and 13,800 kWh for gas) but following a consultation, the CER revised these figures to 4,200 kWh for electricity (and 11,000 kWh for gas), which represents a decrease of 21pc (and a decrease of 20pc for gas).
The CER says that this is because we are more "conservation conscious" and also reflects the greater energy-efficiency our homes and appliances.
But it also means offers from suppliers show a lower level of savings, which will also show up in accredited price comparison websites like Switcher.ie and Bonkers.ie.
Sunday Indo Business