What's the deal with Electric Ireland's Low User Tariff?

What's the deal with Electric Ireland's Low User Tariff?

What a fuss 

Today Electric Ireland had the dubious honour of being splattered across the front page of the Herald and labelled a “rip-off”. They were also the number 1 story on the Irish Times website because according to the paper of record "over 100,000 face higher bills for not using enough electricity".

It must have been a slow day because this is old news. Electric Ireland announced their Low User Standing Charge way back in December and the rate actually took effect from the beginning of February. Maybe it's making news now because it’s appearing for the first time on some bills.

So who will have to pay it and what the heck is it?

Well, most people won’t have to pay it. It’s a kind of holiday home tax. Electric Ireland says that they lose money on vacant properties and need to start charging a subsidy for months where usage is very low or non-existent.

Here’s how it works. If you use less than 2 units per day on average for a billing period (two months) you’ll be charged an extra €9.45 on your bill. If you use more than 2 units per day you will not be charged anything extra. The charge works out at 15.5 cents per day, which is around what a unit of electricity costs.

To put the charge in perspective, Irish households use 5,300 units of electricity per year - that’s 15 units of electricity per day. So this charge is unlikely to appear on your electricity bill unless you have a second home that stays empty for long periods. Even then, you might not see the charge because an alarm or a fridge will probably use enough electricity to get you above the threshold.

That's certainly not to say that Electric Ireland won't be making a few extra quid from this. I'm sure they will, but people at home shouldn’t be too worried. It would take monumental effort and a whole lot of candles to get household usage down to a meagre 2 units per day.

But if you do see the charge pop up on your bill, and you don’t want to pay it next time around, you can always switch. Airtricity and Bord Gais have said they won’t charge it, so there you go.

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