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What is the PSO Levy?

What is the PSO Levy?

The PSO Levy, or Public Service Obligation Levy, is a government subsidy that is charged to all electricity customers in Ireland. The money collected from the PSO Levy is used to subsidise renewable energy generation and peat burning power plants. The PSO Levy is also used to secure the Irish electricity supply.


How much is the PSO Levy?

The Commission for Energy Regulation sets the level of the PSO Levy every year. The PSO Levy was set by the CER at €5.90 per month on 1 October 2016. Every domestic electricity customer pays this charge. The PSO levy is subject to VAT, so customers actually pay €6.69 every month regardless of how much electricity they use.


The PSO Levy on Your bill

The PSO Levy appears on all domestic electricity bills and can usually be seen in the bill breakdown as a line under the Standing Charge and the quantity of units for which you are being charged.

As most bills are bi-monthly, the charge is generally presented as €11.80, which covers two months. Some suppliers calculate the PSO Levy at 19.38 cent per day, and for billing cycles that cover differing periods, you may see a different amount.


PSO Levy History

Since the PSO Levy was first charged in 2010, it has fallen twice - in 2011 and in 2015. The PSO Levy is currently €70.75 for the 2016 – 2017 period.

PSO Levy History
Period Monthly Cost Annual Cost
2010 - 2011 €2.73 €32.76
2011 - 2012 €1.61 €19.33
2012 - 2013 €2.32 €27.84
2013 - 2014 €3.57 €42.87
2014 - 2015 €5.36 €64.37
2015 - 2016 €5.01 €60.09
2016-2017 €5.90 €70.75

Prices quoted do not include VAT.


How is the PSO Levy determined?

The amount that customers are charged for the PSO Levy depends on a range of factors, the biggest of which is the wholesale price of electricity.

In general, if the wholesale electricity price (also known as the SEM price) is high, less money is needed to subsidise renewable energy generation, peat burning power plants, and security of supply gas power plants. That’s because they receive more money on the open market for the electricity they produce.

When wholesale prices are low, more money is needed to subsidise PSO schemes because they make less money on the open market.

Because the main objectives of the PSO Levy are the promotion of renewable energy generation, the security of our energy supply and the use of indigenous fuels like peat, it has been determined that certain types of power generation should be protected from sharp market fluctuations.

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