THE COST OF living crisis is now the single biggest worry for the public according to some opinion polls.
The scale of the problem was brought home by the latest Consumer Price Index, which has measured prices at an average of 5.5% higher than the same time last year.
The rising cost of living is being driven primarily by increased energy costs and many other price rises are also being pushed up by this.
The “centrepiece” of the government’s newly announced measures to combat the crisis is the €200 energy credit for households. What is this credit and who will benefit from it?
How does the credit work?
The once-off credit will be automatically applied to all electricity customer accounts in the March/April billing cycle, so you won’t have to do anything to avail of it.
The government has said that giving a credit to people’s electricity accounts was the quickest and most straightforward way to help all households.
The Commission for the Regulation of Utilities is in charge of overseeing the scheme and it is operated by ESB Networks.
ESB Networks will make payments to energy suppliers who will in turn credit all their domestic electricity account holders with the €200.
How much exactly is this energy credit?
As of last night, the credit is to be €200 including VAT. Before Christmas the plan was that a credit of €100 excluding VAT would be applied in March.
However, the inflationary situation is changing so quickly that the government was forced into increasing the credit before the previously announced credit even took effect.
Excluding VAT the value of the new payment is €176, so the move isn’t quite a doubling of what was previously announced.
The total cost to the exchequer of the energy credit will be €378 million. Before the increase, the credit was slated to cost €215 million.
So this is a once-off credit, as in just one bill?
If your bill is more than €200 then the credit will be eaten up in a single bill, yes.
If however your bill is less than the €200 credit then the balance of the credit will be carried over into the next bill and you’ll get the benefit of the rest of it then.
Basically each customer account will benefit from €200 credit only, whether that’s over one billing cycle or more.
It is estimated that about 2.1 million account holders will benefit from the scheme
Does that mean every customer gets exactly the same credit?
Yes that’s right, the credit is not means tested and the only requirement to benefit from it is to have an electricity account.
This is something that has been criticised by opposition parties and some advocacy groups.
Sinn Féin, for example, has said it would have kept the original energy credit at €100 but also given people an additional cash payment based on their income.
The proposal would see people earning up to €30,000 receive a €200 cash payment and people earning €30,000-€60,000 receive a €100 cash payment.
The Social Democrats have also argued that the €200 energy credit should not apply to holiday homes.
So some people may benefit twice from the credit?
Yes, if someone has a holiday home and is therefore an electricity customer in two properties then they would benefit from the credit twice.
The government has argued that the credit is being paid through utility companies who don’t know if a property is a holiday home or not, so there’s no easy way of just cutting holiday homes out.
I use a prepay meter and don’t have a bill, will I benefit?
Yes, the government has said that pay as you go customers will benefit from the scheme as their prepaid cards should be credited with the €200.
I pay electricity through my rent, will I get the credit?
The credit is reflected on the account holder’s bill, so if that account holder is the landlord it is they who will see the benefit.
There might therefore be a discussion to be had between a landlord and a renter in the event that electricity is included in the monthly rent.
The government has said that it is working with the Residentials Tenancies Board (RTB) to publicise details of the scheme so that renters who hold accounts benefit.
The department also points to the RTB’s disputes mechanism is available should a dispute arise.
I’m a gas customer with Electric Ireland, will I get a credit on my gas bill?
No, the credit is for electricity accounts only, so whichever electricity supplier you have that’s where you should see the credit reflected.
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