Cost of Business Advisory Forum calls for examination of 'pass through' energy costs

Enterprise minister Peter Burke.  Energy pricing has been identified as the biggest driver of business costs in Ireland, as the final report of the Cost of Business Advisory Forum published on Friday outlined 63 recommendations aimed at reducing business costs, strengthening competitiveness, and easing regulatory burdens. Picture: PA

Energy pricing has been identified as the biggest driver of business costs in Ireland, as the final report of the Cost of Business Advisory Forum published on Friday outlined 63 recommendations aimed at reducing business costs, strengthening competitiveness, and easing regulatory burdens.

The forum aimed to look at practical ways to cut the cost of doing business. It set out recommendations focused on price transparency, switching and access, regulatory reform and simplification, and targeted measures to address bottlenecks.

The price of energy was highlighted as the biggest non-pay-related cost. Among the report's recommendations on energy, it recommends examining the scale and impact of non-wholesale pass through costs on electricity bills, with its focus on both SME and domestic customers. It also recommends amending the mandate of the Commission for Regulation of Utilities to ensure consideration is given to affordability for non-domestic customers in the formulation and approval of multi-annual network investment plans. It calls for the feasibility of a new scheme to reduce prices for large energy intensive business users, and to consider the introduction of accelerated capital allowances for energy audit measures.

“From the outset, I was clear that this Forum should be output-oriented and not just a discussion group. The recommendations found in this report reflect this approach and provide a strong foundation for practical reforms to reduce the cost of doing business and regulatory burden," said enterprise minister Peter Burke. "I am committed to advancing those recommendations within my remit that support competitiveness, sustainable job growth and the long-term success of our retail and SME sectors.” 

Ibec executive director of membership and services Sharon Higgins said the report provides a clear roadmap for addressing many of the cost pressures facing Irish businesses. "The report’s 63 recommendations directly align with Ibec’s key priorities to inject long-term productivity and operational resilience into Irish business. However, the ultimate value of this report depends on decisive implementation.

"While tangible progress on addressing business costs will require significant delivery across the majority of the report recommendations, delivering immediate relief requires a sharp focus on some key areas - such as energy, infrastructure & planning, and regulation."

The forum gathered input from business representative bodies, social partners, regulators, State agencies and Government departments examined key non-pay cost drivers affecting enterprise, including energy, insurance, legal services, water and wastewater services, infrastructure and planning, tax administration and regulatory compliance, and banking and financial services.