Taoiseach Leo Varadkar has said that energy price reductions seen so far are “nowhere near enough” and signalled the Government would take action if bills did not come down fast enough.
It came as TDs criticised Electric Ireland for reducing energy costs by 10 per cent for small to medium-sized businesses, but not for households.
The cut comes into effect from Wednesday.
Figures released by the Central Statistics Office indicate wholesale electricity prices fell in January by 41.4 per cent compared with the previous month, and by 19.5 per cent compared with the same month last year.
Although wholesale costs have fallen, there can be a delay before this affects the prices paid by customers.
During Leaders’ Questions, Labour leader Ivana Bacik asked whether asking energy companies to cut their prices was the best the Government could do, particularly as Electric Ireland is under state ownership.
She told the Taoiseach: “You’re not doing anything for people who are seeing this inequity. It’s really amounting now, Taoiseach, to a quadruple whammy.
“We’ve seen the magnitude of energy providers’ profits, we’ve seen the inertia and delay in your approach to windfall tax.
“We’re also seeing a third thing – extortionate charges on households – and now, fourthly, the inequity where we’re seeing reductions in wholesale prices has been passed on to businesses, but not to families and households.”
Mr Varadkar acknowledged that people and businesses were still under pressure from “very high” utility bills.
“A lot of those big bills around electricity and gas have only been arriving in the last couple of weeks,” he told the Dáil.
“In the run-up to Christmas and around Christmas, people thought maybe it wouldn’t be so bad. And then the winter bills started arriving in January, February and people got a really big shock and more bills to come, unfortunately, in March and April.”
Mr Varadkar said the Government had kept the VAT rate on electricity gas at 9 per cent, and updated the Temporary Business Energy Scheme as part of its spring cost-of-living package announced last week.
He said a €200 energy credit announced as part of Budget 2023 is due in the coming weeks.
Mr Varadkar continued: “Pinergy has announced reductions for retail customers, and Electric Ireland has announced reductions for its business customers. But it’s not enough. It’s nowhere near enough.
“Wholesale prices are now coming down. I understand that there is a lag between the wholesale prices coming down and retail prices for homeowners and businesses coming down, I get that, but it shouldn’t be too much of a lag.
“It took a few months for prices to go up. It should only take a few months for prices to go down.
“And we expect to see electricity and gas companies reduce their prices over the course of the next months for businesses and for residential customers as well.
“It won’t just be about polite encouragement.
“There’s windfall tax coming that will be legislated for in this house and in the Seanad, and that will allow us to recoup some of the profits and give them back to people in the form of reductions in bills.
“(We) have to work out the exact mechanisms around that, but that’s what we intend to do. We’ll be saying to state-owned companies, for example, that if you make hyper profits, we have the power to take some of that off you in the form of a special dividend and use that money to help people as well.”
Mr Varadkar said this final measure is “under consideration”.
Social Democrat TD Jennifer Whitmore later told the Dáil that the “time has come” to ask energy providers for clarity on when homeowners can expect to see a reduction in their energy costs.
People Before Profit–Solidarity TD Mick Barry said people are at “the pin of their collars” on rising costs, and it is “blatantly unfair” to reduce bills for small businesses and not for households.
“An electricity price cut for one should be an electricity price cut for all,” he said.
Last week, the Government decided against introducing a fourth €200 electricity credit for householders as part of its €1.3 billion spring cost-of-living package, and instead targeted measures towards those on welfare and families of school-age children.
