ENERGY companies have been urged to slash the price of electricity and gas after it emerged that the wholesale cost of gas has sharply dropped - Charlie Weston and Paul O'Donoghue
A gas supply deal reached between Russia and Ukraine has sent wholesale gas prices crashing, with Irish prices down by 2pc yesterday alone.
The deal means that Russian supply of gas into Ukraine, which had been suspended, will resume for the crucial winter period and is guaranteed until March 2015.
Gas supplies delivered into European countries from Russia via Ukraine are now more secure. This is of significant importance to Irish gas prices given that Russia provides approximately a third of the EU's gas demand, with half of that coming via Ukraine.
Irish wholesale gas prices are now down by 26pc since the start of the year, and the vice-chairman of the Consumers Association Michael Kilcoyne has called on energy utilities to pass on the cost reductions to consumers.
"Electricity prices are up 50pc in the last four years. They are quick enough at passing on cost increases," he said.
Energy expert Simon Moynihan of price comparison site Bonkers.ie said the lower international gas prices would make price increases unlikely this winter.
Electric Ireland did announce a 2.5pc price cut in October, but no gas company has announced any cut in prices in advance of the winter.
"We are unlikely to see household gas prices go down for the winter. This is because gas for winter supply to households would have already been secured through future contracts," said Mr Moynihan.
However, he added: "It is telling that wholesale gas prices are down 26pc this year and yet household gas prices went up by just over 2pc in April when transportation costs were blamed."
Energy expert Joanne Daly at independent gas and electricity supplier Vayu said that the deal was good news for Irish consumers.
"Concern over winter supply is greatly reduced and we're seeing a drop in prices in line with this with all contracts traded so far today falling in value," she said.
"I would imagine that this would filter through [to consumers], but it will depend on the suppliers."
A spokesman for Commission for Energy Regulation said that the CER "hoped" that falling wholesale prices would be passed onto the consumer.