What is the PSO levy?

Simon Moynihan

Staff Writer

The PSO levy, or Public Service Obligation levy, is a Government levy that is charged to all electricity customers in Ireland. The money collected from the PSO levy is mainly used to subsidise and support renewable energy generation in Ireland.

How much is the PSO levy?

The Commission for Regulation of Utilities (CRU) sets the level of the PSO levy every year, which runs from 1st October until 30th September. 

The levy is currently €34.08 (ex VAT) or €38.68 (inc. VAT) for the 2019/20 period.

Every domestic electricity customer pays this charge.

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.

PSO levy history

Since the PSO levy was first introduced in 2010, it has fallen four times - in 2011, 2015, 2018 and 2019.

The PSO levy is currently €38.68 for the 2019/20 period which is the lowest it has been in several years.

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.

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

In general, if the wholesale electricity price (also known as the SEM price) is high, less money is needed to subsidise renewable energy generation and peat burning 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.

Thus when the wholesale price of electricity rises then PSO levy tends to fall and vice versa.