Industry spared but home electricity costs rise 50%

Irish households saw a jump of almost 50% in the cost of their electricity over four years while the price industry pays is lower and has not seen such an increase.

The latest figures released by Eurostat show that before taxes, Irish electricity is the most expensive in the EU for medium-sized households, and the third costliest when taxes and Vat is included.

The figures confirm the recent Irish Examiner revelations that the Fianna Fáil-Green party coalition in October 2010 deliberately decreased electricity costs for large energy users, and agreed that this could be recouped from householders.

The latest Eurostat figures going back to the beginning of 2008 show that householders at the end of last year were paying almost double what large industrial users were being charged for their electricity.

And while industry saw its price fall last year from €0.137 to €0.131 — down 4.37% over the 12 months — households, suffered an increase of 5.45% with the cost per kilowatt going from €0.241c to €0.254.

Eurostat recorded the price movements every six months from the start of 2008, when the price per kilowatt for households was €0.177 just as the economic crisis was biting. It was €0.130 for industry.

The second half of 2008 saw a substantial jump for both kinds of users, but while prices fell every six months until 2012 for industry, price movements were not as kind to householders.

They dropped to €0.112 in early 2009 following the government agreement for “the permanent rebalancing from October 1, 2010, of network tariffs towards large energy users to be paid for by higher prices to domestic consumers”, to help safeguard employment.

Industry complained to government that while domestic electricity prices were close to the EU average, for industry the cost was much higher. But the figures from Eurostat do not support this and find that while Irish householders were paying 20% more than the EU average, industry prices were about 14% higher.

The cost to industry benefits from a very low tax rate of just over 6% — the 13th lowest tax rate in the EU, while householders pay close to 18% in tax, levies and Vat.

However this is lower than the EU average tax rate of 32% tax and contributes to cut the overall cost, making the country the third most expensive for electricity to domestic users.

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