Caitríona Redmond: No more energy credits – are you ready for higher bills?
The Commission for the Regulation of Utilities (CRU) issued figures in early February which showed that 10% of domestic electricity users were in arrears, with a slightly smaller percentage of domestic gas users also in arrears.
The Taoiseach has said that it’s highly unlikely the next budget will include energy credits or cost-of-living payments.
For some, this will come as no surprise, as the Government has repeatedly stated that the extra payments were designed to cushion society from the cost-of-living crisis, and they weren’t applied to longer-term payments like social welfare.
The level at which the extra bonuses were helping the wider population can’t be underestimated.
The Commission for the Regulation of Utilities (CRU) issued figures in early February which showed that 10% of domestic electricity users were in arrears, with a slightly smaller percentage of domestic gas users also in arrears.
The rate of increase on domestic energy bills has slowed; however, in the background, the energy market has fluctuated more wildly.
Energy companies use a strategy called hedging, which basically means buying energy when it’s cheapest and then passing on that saving to their businesses or customers.
As a result, while the European energy market may be moving up and down, customers have benefited from this hedging policy, and bills have not mirrored the frequent variances.
With the change in leadership in the United States and its shift in energy policy to “drill, drill, drill,” the cost of energy in Ireland may change.
However, it may not change significantly due to advanced buying and hedging by our energy companies.
Other issues that could impact future energy costs include extreme weather events, such as Storm Éowyn, which struck over three weeks ago.
Maintaining our electricity network into the future will incur additional costs as a result.
Ultimately, the domestic energy consumer, that is me or you, will have to pay for all these things.
Without the cushion of additional payments from the Government via the budget, how can we combat paying more for our energy in the future?
If the cost of energy remains the same as it is now, our household energy expenses are likely to be higher in the next 12 months, once we factor in the lack of Government subsidies.
Admittedly, the subsidy introduced in the last budget was not as high as in the previous two years, but it still provided a little extra insulation from difficult times, insulation that we may have been getting used to.
How do we adapt to this new, higher cost of energy? Firstly, we need to account for our existing energy costs.
We experienced an exceptional cold snap before Christmas, and the cost of heating our homes tends to be billed in arrears; sometimes as much as two months later.
This means that energy bills from the pre-Christmas cold snap are only now landing in our inboxes, which may be a shock for some, as last winter was not as cold.
That is the nature of energy prices; because we don’t feel the cost immediately, it’s easy to turn on the heat and worry about the big bill later.
Luckily, energy bills don’t have to be paid all at once, providing you can arrange with your energy providers. One way to manage this is through a level-pay or equal-pay agreement with your energy or utility provider.
To do this, you need to contact your provider by phone and ask them to help you calculate your average monthly bill over the course of a year.
You then enter into a monthly standing order or direct debit agreement with the utility service to pay the same amount year-round.
It’s much easier to budget for lighting and heating when you know the cost in advance, and this approach is a great way to manage your finances in general.
Alternatively, you can chip away at your energy bill as and when you have money. Did you know that you can make advance payments on your energy bills?
All utility providers are required to allow customers to make online card payments. You can log into your account online at any time, if you have your MPRN or GPRN and account number, then make a payment using your Visa debit or credit card.
This can be handy for people who are paid weekly, or for freelancers and the self-employed. If you keep your energy accounts in credit, your direct debit should never be pulled from your bank account.
From speaking to many utility service providers, the last thing they want to do is cut off or remove customers from their services.
If reaching out to your provider feels too overwhelming, the Money Advice and Budgeting Service (MABS) is an excellent resource for helpful and supportive advice.
Finally, all energy companies hold specialist registers for critically dependant customers. If you need a continuous electricity supply for medical devices or assistive technologies for independent living, you are entitled to additional protections.
If you qualify, contact your energy supplier directly for further information.
As the days get longer, now is the time to plan to make some home energy upgrades in warmer weather.
The Sustainable Energy Authority of Ireland (SEAI) has a wide range of grants available.
Depending on eligibility you may even qualify for a fully funded upgrade. It’s not a job for the fainthearted, but I am over one year on since my home insulation was fixed, and I am very appreciative of my warmer home and lower energy bills.
You can find more information on seai.ie.
Practicing Lüften may seem counterproductive when the weather is cold, but this German tradition of opening windows wide several times a day for short periods can improve household air quality and energy efficiency.
It can also reduce humidity and mould developing in damper houses. Simply open your windows fully for 5-15 minutes at a time and you will notice the benefits.
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