ELECTRIC IRELAND HAS announced that both gas and electricity prices are set to rise by over 20% starting in May.

The increases come as a host of other energy companies, such as Bord Gáis and Energia, have also announced price hikes due to a volatile energy market.

Residential Electric Ireland electricity prices are set to rise by 23.4%, which would equate to an additional €297.58 per year onto the average cost of electricity

Gas prices are also set to rise, with an increase of 24.8% being announced by Electric Ireland this morning. This equates to an additional €220.25 per year to the average cost of gas from the provider.

Both of these increases are set to come into effect on 1 May.

In a statement, Marguerite Sayers, Executive Director at Electric Ireland. said that prices needed to be increased due to “unprecedented and sustained volatility” in the energy market.

“We are acutely aware that the rising cost of living is causing difficulty for households across the country,” Sayers said.

“Unfortunately, the unprecedented and sustained volatility of wholesale gas prices over the last 12 months means that we now need to increase our prices. 

“We delayed the increase as long as we could in the hope that wholesale prices would drop back to early 2021 levels, but regrettably this has not happened.”

Sayers added that international gas prices were beyond the control of Electric Ireland and that they have a “huge impact” on its costs.

The company have said that it will be introducing supports for customers facing financial challenges, which include flexible payment plans, payment holidays and Pay As You Go meters.

The Government is currently set to roll out a €200 energy credit for electricity bills next week, but some households are unlikely to see benefits until either May or June.

Inflation concerns

Addressing the Oireachtas finance committee today, Central Bank of Ireland Governor Gabriel Makhlouf said the bank is aware that Irish people are facing “very real” price increases.

But Makhlouf — a member of the Governing Council of the European Central Bank, which is charged with maintaining price stability across the Eurozone — said “increases in official consumer prices for energy and fuel are yet to reflect in full the developments of recent weeks and the implications of the conflict in Ukraine”.

He said that rising energy prices and household utilities bills were responsible for about half of Irish price inflation over the past year. Irish consumer prices grew by an average of 5.7% in the year to the end of February, according to the Central Statistics Office, the fastest pace in over 20 years.

“Around half of the current inflation comes from energy,” Makhlouf said.

He added, “And we know that people on lower incomes, older people, rural households, tend to spend a greater proportion of their income on fuel and energy.

“So that’s the sort of simple fact… If those costs are increasing, it is those particular household groups that are going to be impacted the most by the inflation that we’re seeing.”

Asked by Sinn Féin finance spokesperson Pearse Doherty for his opinion of where and when Irish inflation will peak, Makhlouf said, “I’m going to resist the temptation of trying to predict a number.”

But he added, “I definitely can see prices higher than where they are right now. Absolutely.”

— Additional reporting by Ian Curran