Energy companies have been told that price cuts announced this week should “only be the start” of price reductions as wholesale costs fall.
SSE Airtricity announced on Friday that it would cut its electricity prices by 12 per cent and gas prices by 10 per cent from November 1st, becoming the latest provider to slash their costs.
Pinergy, Energia and Electric Ireland have also announced cuts this week.
Minister for Public Expenditure Paschal Donohoe said: “The reductions that have been announced at the moment are welcome, but they have to only be the start.
SSE Airtricity has today announced a decrease of 12% on domestic electricity rates and a 10% decrease on domestic gas rates in ROI.
For more information, please see 👉 https://t.co/I02IAR7OyS pic.twitter.com/umrVjlo6ocAdvertisement— SSE Airtricity (@sseairtricity) September 8, 2023
“Prices went up by a very significant amount over the last 12 months, and the announcements that are being made here today should be the beginning of the journey to see that, as energy prices across the world stabilise and fall, that their full benefits are passed on to Irish households and businesses as well, but it’s only the beginning.”
This week Taoiseach Leo Varadkar said the cuts were welcome but are not “not going to be enough”.
He said: “Certainly one thing I plan to do in the next couple of weeks is to meet with the energy companies and really ask them and put to them my view that there should be further reductions in the next few months, certainly if wholesale prices continue to be lower than they were.”
Figures published by the Central Statistics Office show that wholesale electricity prices, or what companies pay for electricity on the grid, fell by 17.9 per cent between June and July – and were 64 per cent lower compared with July last year.
This represented the lowest wholesale electricity price in two years.
Wholesale electricity prices in July 2023 fell to their lowest level since June 2021https://t.co/fJOHJ5nT9C#CSOIreland #Ireland #Wholesaleprices #Prices #Business #BusinessStatistics #IrishBusiness pic.twitter.com/VWzcmZt8W3
— Central Statistics Office Ireland (@CSOIreland) August 22, 2023
According to the latest Consumer Price Index, published this week, consumer prices for electricity went up 31.8 per cent and gas costs were up 45.6 per cent in August this year compared with 12 months ago.
Mr Varadkar said that the planned windfall tax showed the Government had “got tough” with energy companies, and said it “gives us some scope” to help householders with their bills during the winter months.
He said there would be budgetary measures to help people pay their energy costs, and did not rule out universal or targeted energy credits in the forthcoming budget.
This is despite warnings this week from the budgetary watchdog, the Irish Fiscal Advisory Council, that there was no justification for universal cost-of-living measures.
Sinn Féin TD Louise O’Reilly welcomed the cuts but said the party believed they can go further.
People Before Profit TD Paul Murphy said the recent reductions don’t “cut it” and price caps were needed.
He said: “Prices are still massively inflated from this time last year.
“We need caps on energy prices and on rents in this country which would mean energy companies cannot charge over a certain amount per unit of energy.
“We need retrofitting at no upfront cost to allow people to reduce their energy usage and to renationalise the energy system.
“The Government’s soft touch approach and measures do not cut it for people. This crisis is not going away. We need radical action to take on this crisis.”
