Consumers lose out as energy suppliers have no plans to pass on savings
Wholesale electricity prices fell 13 per cent in December, Bord Gáis index shows
Natural gas prices were down 40 per cent in 2019.
Energy suppliers have no immediate plans to cut household charges despite falls in wholesale electricity and natural gas prices.
The Bord Gáis monthly energy index shows that shows that wholesale electricity prices fell 13 per cent to €45.44 a megawatt hour (MWh – equal to 1,000 kilowatts of electricity used continuously for one hour) in December from €51.96 in November.
Meanwhile, independent supplier Naturgy recently reported that wholesale electricity charges fell 42 per cent the final three months of last year to an average of €41.81 per MWh, while natural gas prices were down 40 per cent in 2019.
Bord Gáis Energy, formerly State-owned but now part of British group Centrica, maintained that it was committed to ensuring that customers got their energy at the best possible cost.
“The global energy market is constantly fluctuating and movement in wholesale prices is just one of the factors at play when it comes to the end price of energy for consumers,” the company said. “We will continue to closely monitor the market.”
SSE Airtricity, a subsidiary of London-listed SSE, noted that it kept prices under review at all times and was committed to providing customers with value.
“We are continuing to monitor the market and when we can pass on any future savings to our customers, we will,” SSE Airtricity said.
The fourth household supplier, Energia, said it also monitored the wholesale market and broader trends, but would not comment on price changes.
Bord Gáis Energy cut natural gas prices by 4 per cent but increased electricity charges by 2.5 per cent in October. Electric Ireland hiked its charge for both by 4 per cent in April 2019, blaming higher wholesale costs, but made no change since.
Energia last cut prices in 2015. It increased prices by an average of 5.9 per cent or €2.26 a week a year ago for customers buying both electricity and gas from the company.
The Bord Gáis index shows that day-ahead natural gas prices fell 13 per cent last month to 32.3 pence sterling a therm (the unit in which the fuel is measured) as supply caught up with demand.
Both that company and Naturgy note that supplies of liquid natural gas – which is shipped around the world – are robust while there are large quantities of the fuel in storage.
Oil was the only exception to the general energy price falls last month, rising 4 per cent as global cartel, the Organisation of Petroleum Exporting Countries, and its allies agreed to cut output.
“In December, the Bord Gáis Energy Index closed at 96,” the company said.
Naturgy’s report indicated that wholesale electricity charges could continue falling this year in line with declining natural gas prices.
However, the company warned that spells of cold or stormy weather could push prices back up.
Natural gas prices heavily influence wholesale electricity costs, as the fuel is used to generate power.
About 60 per cent of the electricity used by Irish people is generated by burning gas. The Corrib field off the Mayo coast supplies two-thirds of this need.