Energy bills higher despite fall in wholesale prices

Energy bills are up to 20% higher in Ireland than in 2017, despite wholesale energy prices falling in that time.
Energy bills higher despite fall in wholesale prices
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Energy bills are up to 20% higher in Ireland than in 2017, despite wholesale energy prices falling in that time.

The figures have prompted calls for energy providers to cut their rates to ease the burden on under-pressure consumers.

An analysis of the Irish energy market since winter 2017 shows that energy suppliers, in most cases, have not reversed price increases implemented over the past two-and-a-half-years, despite wholesale energy prices plummeting on a global scale.

Wholesale gas prices fell by 37% in March alone, prompted by a 55% drop in oil prices. At the end of March, the Bord Gais Energy Index closed at a ten-year-low. Wholesale electricity prices are also tumbling.

But these savings have yet to be passed onto consumers in any meaningful way, according to Daragh Cassidy of price comparison site Bonkers.ie.

Since 2017, SSE Airtricity has increased electricity prices by 16% and gas by more than 6%. Electric Ireland has increased electricity by 11.99%, though its gas prices are 0.6% cheaper than in winter 2017.

Flogas gas prices have soared by 27.9% and the company has not announced a single reduction in that period, while Energia has increased electricity prices by 14.41% and gas prices by 5.12%.

Bord Gáis electricity prices have increased by 14.6%, though the company has announced two price cuts in the last six months. Its gas prices are now 0.4% lower than in 2017.

Mr Cassidy said most of the energy suppliers have increased prices three times, largely due to the increased price of gas, which . Gas makes up 40-45% of electricity generation so it impacts on electricity prices.

Since mid-2019, the price of coal and gas have fallen heavily on wholesale markets. While this has been reflected in a series of price reductions from the main providers - Electric Ireland, SSE Aitricity, Bord Gáis and Energia have all announced price cuts in recent months, but Mr Cassidy said they do not compare to the previous price increases.

He said: "The price decreases that have been announced so far have been fairly measly and in many cases leave prices far higher than there were a year ago when wholesale prices were far higher.

“Due to Covid-19 energy customers are facing a double whammy - a decrease in pay, as well as rising energy bills, as more time spent at home means higher energy usage.

Energy suppliers need to play their part and pass on further price decreases to consumers.

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