We need your help now

Support from readers like you keeps The Journal open.

You are visiting us because we have something you value. Independent, unbiased news that tells the truth. Advertising revenue goes some way to support our mission, but this year it has not been enough.

If you've seen value in our reporting, please contribute what you can, so we can continue to produce accurate and meaningful journalism. For everyone who needs it.

Shutterstock/Yevhen Prozhyrko
Cost of Living

Lower-income customers face 'real difficulty' from rising energy bills, says regulator

The chair of the Commission for the Regulation of Utilities said it is exploring every option.

PRICE CAPS ON household electricity and gas bills are unlikely to solve the problem of skyrocketing energy prices and household costs, the chair of the utilities regulator has said.

Bord Gáis Energy announced yesterday that both electricity and gas customers will face steep increases in their bills from next month.

The company — which was privatised in 2014 and is now owned by British gas giant Centrica plc — said the average electricity bill will rise by 27% and the average gas bill will increase by 39%.

It blamed the price rises on “the persistence of high demand on gas worldwide, reduced supplies, low storage volumes, geopolitical issues and late winter conditions”.

It’s likely to be the first in a line of bill increases by electricity and gas companies over the coming weeks.

Concerns are mounting about the impact of the latest price hikes — which follow hot on the heels of a series of price increases by utilities companies in 2021 — on lower-income households.

“There are some customers that are in real difficulty,” said Aoife MacEvilly, chair of the Commission for the Regulation of Utilities (CRU) this morning.

Speaking on Morning Ireland on RTÉ Radio 1, she said, “We’ll be looking at enhancing the protections, particularly protections against disconnections, enabling customers to get onto payment plans.

“We’re entering a period now where bills will be lower. The heating use is hopefully coming to an end. But coming into next winter, we will be making sure customers are aware of their rights and aware of the actions they can take to help lower their bills.”

However, about half of Ireland’s electricity is generated by gas-fired power stations, meaning customers are likely to remain under pressure due to elevated wholesale gas prices.

Asked why the CRU hasn’t recommended price caps, MacEvilly said the regulator is looking at every option that might have “a better outcome for customers”.

However, she added, “Unfortunately, price caps and competition cannot avoid or mitigate against the fact that prices on wholesale markets have risen to many, many multiples of what they were just a few short months ago.”

Electricity retailers like Iberdrola, Electric Ireland and a host of other companies have all increased their prices in the past eight months due to higher input costs due to higher wholesale gas costs.

The war in Ukraine is likely to compound those difficulties, given Europe’s reliance on Russia for much of its natural gas supply.

Sean Moynihan, chief executive of charity ALONE, said the increases are going to have a disproportionate impact on older people.

“When you have a fixed weekly income, like the State Pension, which is already below the poverty line, you have little or no disposable options you can drop out of your spending,” Moynihan said.

“Heating is most important for older people to help manage chronic health conditions, but now some people are having to weigh up their choices between heating or eating. No one should have to make these choices.”

The Government has already rolled out a number of measures aimed at cushioning the blow of sharp energy price increases on households, including a €200 energy credit, which is yet to be paid out.

Speaking yesterday, Sinn Féin’s social protection spokesperson Claire Kerrane said, “It is urgent that the Government take further action on soaring home heating costs and that they take it now.” 

“Sinn Féin are once again urging the government to establish a Discretionary Fund to support households who are struggling with energy costs and who are locked out of social welfare supports. We also need to see the Fuel Allowance extended to those in receipt of the Working Family Payment, which is a payment for provided to low-income working households.”

Energy Minister Eamon Ryan said yesterday that the Government was aware that there would be further price rises adding that the Government would try to cushion the cost increases.

While Ryan said that measures like the fuel allowance increase will not cover all of the increases, they would help: “The fuel allowance increase will kick in next week, again it doesn’t cover the full burden but it helps.”

Speaking to reporters in Washington about the increases, Taoiseach Micheál Martin reiterated that message, saying that this volatility within the energy sector was being caused by the Russian invasion of Ukraine.

“It’s also very important to say that the the war is having its impact and it’s a very, very tough impact on a lot of other people, particularly people on low incomes,” Martin said.

“This is one of the prices now that we’re paying, because of this illegal and immoral war.

“We will have to, obviously, collectively, across the European Union see how best we can work to shield our people and our citizens from these impacts – we won’t be able to do it all – but we’ll certainly continue to see how we can alleviate the pressures on people.”

— Addtional reporting by Céimin Burke and Christina Finn in Washington

Readers like you are keeping these stories free for everyone...
A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article. Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation.

Your Voice
Readers Comments
This is YOUR comments community. Stay civil, stay constructive, stay on topic. Please familiarise yourself with our comments policy here before taking part.
Leave a Comment
    Submit a report
    Please help us understand how this comment violates our community guidelines.
    Thank you for the feedback
    Your feedback has been sent to our team for review.

    Leave a commentcancel