It has been a bad PR week for Ireland.
A political crisis brought us to the brink of a general election, an international study revealed that we’re the third most expensive country in the EU for broadband and now, Eurostat has shown that we have the fourth highest electricity prices across the 28 member states.
According to Eurostat, only Denmark, Germany and Belgium have higher electricity prices than Ireland.
Irish customers pay an average of 23.1 cent per kilowatt hour of electricity used, which is 13% higher than the EU average.
To place that in context, one kilowatt hour of electricity will get you about 10 minutes in an electric shower, 20 minutes of kettle-boiling or about an hour and a half of dishwasher use.
The Government gets a pass on why electricity prices are so high here.
The proportion of electricity costs that are made up by VAT and other taxes is relatively low, compared to other EU countries.
In fact, when VAT and other taxes are removed from calculations, Ireland has the second highest electricity prices in the EU.
A major reason why Ireland’s electricity prices are so high is that we largely rely on imports to meet our energy needs. Only Cyprus, Malta and Luxembourg have worse energy dependence that Ireland.
This reliance on imports puts Ireland at the mercy of wholesale gas prices, which have been volatile throughout 2017.
Ireland poor interconnection capabilities is another driving force behind high prices here. In 2015, the European Commission revealed that Ireland is below the EU's minimum interconnection target.
There are nine electricity suppliers in the Irish market - a huge number for such a small country - but consumers don't seem to be benefitting from this high level of competition yet.
In recent weeks, six out of Ireland’s nine electricity suppliers have announced price hikes.
Increases from Bord Gáis Energy and SSE Airtricity took effect on November 1st, increases from Energia, Pinergy and PrePayPower will take effect on December 1st and Electric Ireland’s increases will take effect on February 1st 2018.
Most suppliers are offering substantial discounts and cashback incentives to new customers who switch, and there is currently over €150 to be saved on average by doing so.
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