Network, regulatory, policy and other costs account for more than half of what Irish people pay for electricity, new research shows.
The Republic has the most expensive electricity in the European Union, with households paying 40 cent a kilowatt-hour, almost €1,700 a year, on average, for their power, 40 per cent more than the European average.
Network charges, the cost of incentives to lure investment in new power plants, the impact of policy and regulations, and other expenses now account for 55 per cent of what households pay for electricity, research by a new think tank, Trifecta Ireland, shows.
And the non-electricity costs can make up an even greater share of bills paid by some industries, Trifecta Ireland chief executive Conall Bolger noted at the launch of the organisation’s report titled What Can Move the Needle on Bills before 2030, on Wednesday.
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The report proposes 17 measures that could cut electricity costs in the shorter term while investment in power plants and long-term improvements to the national grid and distribution networks are under way.
Bolger noted that the changes focused on aiding electricity customers. “We need to use existing networks more efficiently, we need to make the system more flexible, and we need to get more out of what we have,” he said.
The proposals include mass retrofitting of social housing, reforming the system for paying power plants to remain on standby when they are not generating electricity, more focused supports for families in energy poverty, and various measures to encourage electrification and to give homes and businesses flexibility to use electricity at times when it is cheaper.
Work on a long-delayed cross-Border power line that could cut €150 million a year from electricity bills will begin next year, Minister for Energy Darragh O’Brien pledged at the launch.
Planning and political controversies have delayed construction of the North-South Interconnector, a high-voltage electricity line running from Co Meath to Co Tyrone that was first proposed 20 years ago.
O’Brien said on Wednesday that work should begin on the project next year as it now has full planning permission.
“It’s going to be built,” the Minister emphasised. He told a conference that the power line would be subject to “no more reviews” and noted that four studies had weighed whether it was possible to run the line underground rather than on pylons.
“It will deliver reductions in energy bills of up to €150 million annually,” added O’Brien.
Trifecta’s Ireland research drew on more than 40 State, civil society and energy industry organisations. Funded by the family of Irish renewable energy industry pioneer, Eddie O’Connor, Trifecta Ireland focuses on how to provide an electricity system that is affordable, clean and secure.
