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Electric bills about to soar with two hikes in two months

HARD-pressed consumers and businesses are facing a double whammy of two electricity price rises within the next two months.

A new environmental levy will hit all electricity customers, regardless of their ability to pay. Each home will have to pay a new levy of €32.76 to subsidise the higher cost of using more environmentally friendly ways of generating electricity.

Small businesses will have to pay an extra €99 annual levy and big businesses will be hit with a 5 pc rise for overall usage.

A chorus of condemnation has greeted the hike -- businesses declared jobs will have to be axed to contain costs while the St Vincent de Paul organisation warned the levy would hit the poor indiscriminately.

Electricity users will also have to brace themselves for a price rise on top of the levy. The levy will be introduced in October but a price rise is also looming as another review of costs is under way.

The levy is part of a series of future green taxes which are expected to add up to more than €500 a year in extra costs for each household. These green 'stealth' taxes are part of the agreed programme for Government hammered out between the Green Party and Fianna Fail.

Householders are expected to be hit eventually with domestic water charges of at least €175. They also face a €275 hike in carbon taxes on petrol and diesel. Carbon tax on home heating oil is likely to increase bills by €55 a year.

The Commission for Energy Regulation (CER) is pressing ahead with the 5pc PSO levy, despite calls for a levy to be deferred because of the recession. The electricity bill hikes come despite the ESB making a profit of €580m last year.

Energy Minister Eamon Ryan is planning a price review in September which would be separate from the levy in October.

A spokeswoman for the minister said he had no power to interfere with the electricity price rise. But the CER has confirmed it would implement any change in policy on the PSO levy if the Government made such a decision.

Fine Gael condemned the levy and predicted price rise.

"It is anticipated that this will also lead to an increase in prices, particularly for domestic users. Both hikes hitting around the same time are likely to see household bills go up by 10pc in a month," said energy spokesman Leo Varadkar.


The Industrial Development Authority has warned that multinational companies had expressed concern about proposed increases in electricity costs. Around 150 companies represented by IBEC's Industrial Products and Services Group said the rise could add between €34,000 and €500,000 to their electricity bills.

The Commission for Energy Regulation received submissions from Pharmachemical Ireland which said the price increase would lead to a loss of between 550 and 800 jobs among its member companies.

A St Vincent de Paul spokesperson said: "The addition of an average of 5pc on household electricity from October is yet another blow to the most hard-pressed in society."