Electric Ireland is the first energy supplier to implement an electricity price increase since Bord Gáis Energy in late October 2019.
A rise in the cost of basic household utilities is never good news for consumers, but today is unfortunately one of those days for Electric Ireland customers around the country.
Not six months after announcing a decrease in its electricity and gas prices, Electric Ireland today announced it would be reversing its electricity price decrease by increasing the average residential electricity bill for customers.
If you’re an Electric Ireland customer you can take a look at the changes below and see how much it might end up costing you.
What’s changing
From 1st October leading energy provider Electric Ireland (EI) will increase the cost of its electricity, with the average residential electricity bill going up by 3.4%.
The increase will see EI customers pay an extra €2.88 per month on the average residential electricity bill, or €34.56 annually including VAT.
Electric Ireland only recently announced a price reduction on its gas and electricity prices which came into effect on April 1st; an 11.5% and 2.5% reduction respectively.
However, today’s announcement will overturn the previous electricity price decrease of 2.5% and see it rise again just as we come into the colder months of the year.
That being said, the energy supplier has stated that it will freeze its gas prices for the entire winter, meaning the aforementioned 11.5% decrease for customers announced in April will be maintained. This decrease saw customers save around €78 on their average annual gas bill.
Electric Ireland continues to offer a 5% discount to customers experiencing financial hardship through industry pre-payment meters and through the Household Budget Scheme.
Executive Director, Electric Ireland, Marguerite Sayers, said:
“At Electric Ireland, we always try to offer our customers a very competitive rate by keeping our standard rate as low as possible. In April, we reduced energy bills for gas and electricity customers by circa €100 annually because fuel costs were falling at that time. Unfortunately, due to other electricity system and market costs outside of our control, we now have to increase our electricity prices from October 1st. This will mean an increase of €2.88 per month on the average residential electricity bill.
On a positive note however, we are freezing gas prices through the winter period as we have done in previous years. Gas prices were already reduced by 11.5 per cent in April, which means a continued reduction of €78 on an average annual gas bill. We also have one of the lowest standard rates in the market for electricity and gas which we automatically apply for all our customers.
Sayers added:
In addition, we remain the only Irish supplier to offer an enduring discount rate of up to 8.5% for gas and electricity, a discount that does not disappear after a year. This protects customers from price shock at the end of a contract period and benefits large numbers of loyal Electric Ireland customers, rather than just offering discounts to new customers which is a typical approach in the market.”
The reason for the increase
Electric Ireland has said the reason for the price increase is due to costs impacting the broader electricity system and market.
In other words, Electric Ireland is being charged increased network operator charges and is in turn passing these on to the consumer.
However, the decision to increase the price of its electricity could very well open the floodgates for other suppliers to raise their prices coming into the colder winter months too, and at a time when families are already cash-strapped due to the pandemic.
Today’s announcement is joined by the increase in the PSO levy which will see consumers pay even more for their electricity use in what is a double-whammy of price increases for consumers.
Thus far, consumers have been paying an annual charge of €38.68 (€3.22 per month inc. VAT) for the levy, but come the start of October, will see it jump to €88.80 (inc. VAT) for the 2020/2021 period.
To find out more about the PSO and what it is you can read our guide here.
The last supplier to increase the cost of its electricity was Bord Gáis Energy, which implemented a 2.5% price increase to its standard electricity unit rate at the end of October last year.
This was followed by a subsequent passing on of savings to consumers from energy suppliers in the months that followed due to falling wholesale energy prices.
Switch and save
As always, the only way to offset any price increase is to make sure you switch suppliers when you’re out of contract. Loyalty to any given supplier no longer pays, unfortunately.
The average energy customer who switches today on bonkers.ie could save up to €454 on their annual energy bill, and that’s not taking into account those who haven’t switched in some time.
So whether you want to switch your electricity, gas or get the best dual fuel plan available, you can use our price comparison tool here and switch and save in seconds.
