Plan to cut power bill by almost €48
Regulator’s proposal would see household energy costs drop by almost €4 per month
HOUSEHOLDS can look forward to a welcome drop in their power bills after a Government commission recommended that the Public Service Obligation levy be cut by almost half.
It means annual electricity bills will be cut by nearly €48 – almost €4 a month – if the proposal is approved.
The cut is due to the a reduction in Ireland’s green energy subsidy.
The Commission for Regulation of Utilities recommended the cut as the rising wholesale price of gas used in power stations pushed up the domestic price of electricity.
That means the price paid to wind-farm and hydro-electric producers has risen in tandem, reducing their need for help from the PSO fund of €472million this year.
The cash is also used to subsidise peat-burning power plants which are slowly being phased out.
The CRU has recommended the fund be cut by 40% from October to almost €260million, bringing lower bills for everyone.
Switch website Bonkers.ie spokesman Robyn Hamilton said: ‘Should this year’s proposal pass unrevised, it will mean the lowest PSO levy charge we’ve seen since the 2013/14 period, which saw customers charged an extra €42.87 on their annual electricity bills.
And the head of rival switching website switcher.ie Eoin Clarke said: ‘From a consumer perspective, a decrease in the PSO levy – which all consumers must pay – will come as welcome news.
‘Last winter, almost all energy suppliers hiked prices, and last week SSE Airtricity announced what is likely to be the first price rise of the summer, so a decrease in the levy is the first reprieve for consumers in some time.’
The PSO levy is raised by the Government to make sure the electricity supply is secure and to support renewable power in the fight against climate change.
It adds almost €105 to each electricity bill annually and will be cut to just €57.60, if the Government approves the latest recommendation.
In a consultation paper released yesterday, the CRU suggests reducing the PSO by €3.43 a month for households.
It also suggests reducing the charge by €12.30 a month for small- and medium-sized businesses.
Consumer and business groups have been given until June 29 to respond to the CRU’s consultation paper.
The regulator will reach a decision in August and introduce the new levy in October.
The exact levy amount for next year will be announced later in the summer after it is approved by the Government, and will start from October 1.
SSE, in both Britain and Ireland, is being hit by new competition in the market and profits fell this year, despite higher energy consumption during the Beast from the East.
Meanwhile, two major Irish wind power projects have been put up by sale by investors this week.
AMP Capital, which co-manages the State-backed Irish Infrastructure Fund, is selling 110 megawatts (MW) of wind farms on both sides of the border.
The southern wind farms are located in Cork, Donegal, Roscommon and Sligo.
Major investment firm, BlackRock, has announced it is selling wind farms across Europe. It includes around 45MW of Irish projects.
One megawatt of wind energy powers about 600 homes, according to the Irish Wind Energy Association, so the two groups of windfarms would power almost 100,000 homes. news@dailymail.ie
It adds €105 to each bill