IRELAND HAS THE highest household electricity prices in the European Union, according to new research from statistical agency Eurostat. 

Increases in prices last year means the average household is now paying around €480 a year more for its electricity compared to the EU average.

The new research shows that, at 40.42 cent per kilowatt-hour (including VAT and levies), prices here are almost 40% above the EU average of 28.96 cent. 

Germany has the second-highest electricity prices in the EU at 38.66c, followed by Belgium at 34.99c. 

Electricity prices in the bloc are lowest in Hungary (10.82 cent), Malta (12.82 cent) and Bulgaria (13.55 cent).

It comes after electricity and gas provider PrepayPower announced that it will increase prices next month.

The pay-as-you-go provider said it would raise electricity prices by 8.8% from 1 June, with gas prices to increase by 10.6%. For an average household, this will add an extra €168 per year for electricity and €171 for gas.

Daragh Cassidy, of price comparison site Bonkers, said Irish households have been paying electricity prices that are well above the EU average “for years”, adding that the reasons for this are complex. 

“We’ve a relatively small and dispersed population with a lot of one-off housing, so the costs for the upkeep of our electricity network are very high on a per capita basis,” he said. 

“The rapid growth of the population and the increase in the number of data centres operating here in recent years also hasn’t helped. This is putting pressure on the grid. And in recent years we’ve had to procure high-cost, emergency gas generation to plug the gap between electricity demand and supply.”

Ireland also relies on gas to generate over 40% of the country’s electricity. This heavy usage is one of the main reasons prices here are so high, according to researchers at the ESRI.

Cassidy said countries with cheaper electricity generally rely more on hydro and nuclear.

“Many of our power plants are also older and smaller than those in other countries, so we don’t benefit from efficiencies and economies of scale as much.”

Taoiseach Micheál Martin this week said Ireland should “consider seriously” the use of nuclear energy as part of its future energy mix.

“We’ve made significant progress on renewables, particularly onshore wind and solar, and offshore wind will be a major next step. But we should also look at alternatives, including nuclear, given advances in technology,” Martin said. 

Cassidy that Ireland can’t import a huge amount of cheaper electricity from abroad due to its isolation.

“We have only two interconnectors with the UK at present. Although the new interconnector we’re building with France will hopefully improve things when it comes online in 2028 as it will allow us to tap into cheaper French electricity,” he said. 

However, he said he does not foresee much changing in the short-to-medium term. 

“While more renewables should help bring prices down a bit, we need to be more honest about their true costs and the actual potential savings.

“Renewables require a lot of investment in the grid, as well as huge amounts of battery storage, the cost of which ends up getting passed on to consumers. And the highly variable and intermittent nature of wind and solar means they push up other electricity system costs.”