Friday 14 December 2018

Latest price hike will see a million Electric Ireland users out of pocket by €35

Stock image
Stock image

Charlie Weston and John Mulligan

More than a million households face a hike in electricity prices this week as Electric Ireland imposes rises in its rates.

Electric Ireland customers with average consumption will see their annual bills increase by €35 as a result of the 4pc hike from tomorrow.

The supplier has cited increased wholesale costs.

It has 1.13 million electricity customers, according to the energy regulator.

Back in October, Electric Ireland said it would be freezing all prices until after the winter.

But it added that the 4pc electricity price increase would take effect on February 1.

In the last three months of 2017, Bord Gáis Energy, SSE Airtricity, Flogas, Energia, Pinergy and PrePayPower all hiked prices.

And the levy on all electricity bills - called the Public Service Obligation (PSO) - shot up by 30pc. This added €25 to the average bill, pushing the levy to almost €105 a year, up from €80 last year.

It goes towards the additional costs of producing sustainable energy.

Mark Whelan, of the price-comparison site, said most consumers were only beginning to feel the impact of price increases now, as big winter bills began to roll in.

"Customers who are unhappy with the prices they are paying for gas and electricity should shop around and consider switching suppliers.

"There is an average of €379 to be saved by doing so at the moment," he said.

Householders have eased off on switching supplier, despite the price rises, and even though there are now nine electricity suppliers in the market.

There was an average of 26,154 switchers a month last year, down around 300 a month compared with the average monthly number of switches in 2016, according to the Commission for the Regulation of Utilities.

Mr Whelan said energy firms were attempting to stop customers switching by offering them retention deals.

Electric Ireland offers discounts of between 4pc and 8.5pc to existing customers to stop them moving to another operator.

This is a fraction of what is on offer for switchers, but Mr Whelan said it was having the effect of dampening down switching activity.

Meanwhile, a study from the ESRI shows that expressing prices as discounts from a standard unit rate made it harder for consumers to determine which package was better value.

The study also found that displaying an estimated annual bill made it easier for consumers to identify better-value offerings.

The regulator has since decided to require electricity suppliers to display an estimated annual bill in their marketing material.

Separately, EirGrid has moved to clarify that Dublin's electricity supply will not be affected by the planned closure of Viridian's power plants.

The statement came after Viridian, which owns the Energia retail brand, told the national grid operator that it may be forced to shut both its plants in Huntstown, Co Dublin.

The gas-fired plants, which generate up to 20pc of Ireland's total power output, may have to close after one failed to qualify for new payments that will be made once the electricity market is reorganised in May.

Viridian said it remained convinced that its plants were "critical to the security of supply in the Dublin area". However, EirGrid said power supplies would not be affected.

Irish Independent

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