'It’s astronomical': Further energy bill hikes 'almost a certainty'

The announcement from SSE Airtricity came just a day after energy regulator CRU announced new measures aimed at supporting households this winter. File photo

An unprecedented hike of 30% in SSE Airtricity prices for over 300,000 households means further rises are "almost a certainty", according to advocates.

SSE Airtricity announced its fourth price increase since the start of 2021 on Friday, adding almost €600 to the average annual electricity bill and over €510 to the average gas bill from October 1.

With the previous price increases announced by SSE Airtricity, its 250,000 electricity customers will be paying €1,100 more and its 80,000 gas customers paying €1,000 more each year.

The company said that some 60,000 of its customers will have their electricity costs maintained at May 2022 levels until 31 March 2023, which it said would help offset the increase for vulnerable customers.

Last year, energy suppliers hiked their prices a total of 35 times and the trend has continued into this year. The latest Electric Ireland price increase took effect earlier this month and it’s feared the other major suppliers will soon follow suit. 

Daragh Cassidy, head of communications at Bonkers.ie, said price increases such as this are "clearly unsustainable" but that further hikes from suppliers, including SSE Airtricity, are "almost a certainty".

"Since the start of last year, some suppliers have announced even bigger price hikes that have added over €2,500 to households’ annual gas and electricity bills. It’s astronomical."

With the Budget looming, the Government is being urged to provide relief to hard-hit families.

Celine Clarke, head of advocacy and communications at Age Action, said: “There was a strong argument, even before this latest price increase, to increase the State pension and introduce an energy guarantee and other measures from 1 October immediately after the Budget.” 

Charities have said that a rise of €17 in core social welfare payments such as the State pension will be necessary “just to stand still” in the face of rising inflation, with many calling for at least a €20 increase.

The Government has mooted a potential €15 rise in social welfare payments but this remains uncertain.

The Irish Examiner reported last week that among the considerations are a double once-off payment in the autumn, a permanent increase of at least €10 to all welfare rates and the Christmas bonus.

Ms Clarke also said that widening access to the fuel allowance would be essential to protect vulnerable consumers in the coming months.

“Now is the time to index welfare payments with the rate of inflation,” she added. “We need to make some effort to mitigate the worst effects of these price rises.” 

The announcement from SSE Airtricity came just a day after energy regulator CRU announced new measures aimed at supporting households this winter. It included the extension on the moratorium on disconnections to three months over the winter, and payment plans of at least 24 months for customers who are in debt.

Dermott Jewell, policy and council advisor for the Consumers’ Association of Ireland, said such measures were welcome but urged the Government to look at the “underlying situation” of energy companies making huge profits while customers face higher bills.

A windfall tax on energy companies is something the Government has been looking at ahead of the Budget according to Green Party leader Eamon Ryan, with the funds to be set aside to help households with surging bills.

However, Mr Cassidy from Bonkers.ie questioned how such a windfall tax would work for the suppliers, whose parent companies are headquartered overseas, such as SSE Airtricity and Bord Gáis Energy. 

“The Government needs to decide now how it plans to help households over the coming months,” Mr Cassidy said. “Is the temporary reduction in VAT being kept? Is another energy credit going to be paid? Is the Government going to place a windfall tax on energy companies?”