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Long-awaited energy poverty plan published as Ryan warns prices may not drop for two years

The plan includes a €10 million Government hardship fund for vulnerable energy customers.

LAST UPDATE | Dec 13th 2022, 4:03 PM

ENVIRONMENT MINISTER EAMON Ryan has said that households will not see a significant reduction in energy prices over the next two years.

Ryan said that the Government would decide next spring and summer whether or not additional energy credits for households were required.

“My expectation, unfortunately, for the next year or two years is we’re not going to see significant reduction in gas prices,” Ryan said.

“I think that’s the expectation across Europe, across the International Energy Agency. It’s due to international factors, not domestic factors. If that changed, if the war came to an end, we might see some differences.”

He said that he also didn’t expect energy prices to rise as rapidly as they had over the last six months.

“You cannot be certain as to what any one energy company will do,” Ryan said.

“But my expectation is that the majority of the cost of higher gas prices has already been put into the bills, so depending on what happens in the gas markets, I don’t expect we’ll see the sort of increases we saw in the last six months.”

He made the comments earlier today at the announcement of a new plan to help deal with energy poverty, with a new Government energy hardship fund set to be created.

The Energy Poverty Action Plan was approved by Cabinet earlier this morning, with it set to help people who are struggling with the high cost of electricity and gas.

One measure within the plan is the creation of a €10 million hardship fund within the Department of Environment, Climate and Communications, which will be made available over the winter months and into early 2023.

The fund itself will be mainly, but not exclusively, used to support people who use pay-as-you-go (PAYG) gas and electricity meters.

There had previously been criticism of the Government’s disconnection moratorium, which did not include PAYG customers and only covered bill pay customers.

Currently, PAYG customers are not subject to the moratorium and are automatically cut off from supply if they use up their €20 emergency credit without topping up. However, these automatic disconnections do not take place at the weekend or on Bank Holidays.

This led to calls by Solidarity TD Mick Barry for a ban on disconnections on “any day with a ‘Y’ in it.

The new fund within the Department is set to be used to bolster existing hardship funds which are run by individual electricity and gas companies.

However, The Journal previously examined these hardship funds and found that they were ad hoc in nature, with some companies not having specific funds set aside for customers facing difficulties.

While Electric Ireland has a hardship fund valued at around €3 million, energy company Energia said that it did not have a specific allocation but that it worked with customers on a case-by-case basis.

SSE Airtricity have an overall package of supports that totals up to €25 million, including a price promise for financially vulnerable customers that holds energy prices at June 2022 levels until the end of March 2023.

The Government will continue to issue advice for people to work with their energy provider, go to local Department of Social Welfare offices or seek assistance from MABS (Money Advice Bureau), Alone or St Vincent de Paul.

The definition of “vulnerable people” is also set to be expanded, with financially vulnerable people set to be included.

This means people who receive the Fuel Allowance, Working Family Payment, One-Parent Family Payment, Domiciliary Care Allowance, Carers Allowance or are on Job Seekers Allowance for more than six months will be listed as vulnerable.

Alongside the hardship fund, longer term measures are set to come into effect, including an additional €248 million going to the Warmer Homes Scheme up to 2027, as part of efforts to retrofit more low-income houses.

This money is set to come from the EU Regional Development Fund.

Additional research is also to be undertaken by the ESRI to better measure and respond to energy poverty in Ireland.

Ryan had initially signalled intent for this plan as far back as August, telling the Joint Oireachtas Committee on Environment and Climate Action that it would be introduced shortly after Budget 2023.

Additional reporting by Press Association

Author
Tadgh McNally & Christina Finn
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