Ministers signal second energy credit likely but warn no guarantee blackouts will be avoided

Minister for the Environment Eamon Ryan has signaled a second electricity bill credit for all households will be paid in the autumn to help with soaring utility bills.

He made the remarks ahead of a Cabinet meeting where Ministers discussed the energy crisis and how the public sector can conserve power.

All households received a €200 electricity credit earlier this year.

Asked if a second credit could be paid before Christmas Mr Ryan replied: “yes”. He added: “We held back. A lot of people were arguing we should have done a mini-budget in the summer, and we said at the time ‘no’ because the time this is going to hit is in the late autumn, early next year.

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“So I think it was absolutely right for us to hold our fire to wait to see what the real situation was in the autumn, and that’s when we need to provide supports. That’s the right time to do it,” the Minister said.

Minister for Public Expenditure and Reform Michael McGrath said the electricity credit was an “option on the table” while, speaking later in the day Taoiseach Micheál Martin refused to be tied down on the sum householders could expect saying “I’m not doing the budget now.”

He promised that the Goverment would use the upcoming budget “to do everything we possibly can” to support households and businesses experiencing major increases in their energy costs.

He said there will be a three-pronged approach to the energy crisis with the key one being alleviating the pressure on families and businesses; another being ensuring security of supply and finally using excess revenues from the energy companies to support the measures to help people with soaring energy costs.

The latter measure will be possible if EU energy ministers agree on market reforms designed to bring down the cost of electricity at an emergency meeting on Friday.

Mr Martin said the budget will have a series of measures to help people.

He mentioned the proposed public pay deal as “an important measure for one sector” and he said there will also be a “tax dimension” in the Budget, widely expected to be relief for middle income workers.

He also said there will be cost reductions for services.

Mr Martin highlighted previous cuts in public transport fares and bringing in free school transport in rural areas as well as a drop in health care costs like the Drugs Payment Scheme (DPS) and hospital charges.

He said: “we’re looking at measures that bring down the costs for people, but also have other impacts on climate and enhancing utilisation of public transport.”

The Taoiseach defended the Government’s issuing of energy conservation advice at a time when people want more detailed information on how it will support them financially in paying their bills saying:

“Energy efficiency is a no-brainer in this situation.”

He said other European Union member states have had to take more radical approaches to energy efficiency that Ireland.

Mr Martin said the Government is offering “sensible advice” given the high cost of energy “irrespective of what supports come out”.

“Obviously, the Budget will give the full comprehensive nature of those supports and work is ongoing in relation to that”.

Asked about the difficulty for households in following advice to reduce energy usage at peak times in the evenings, Mr Martin said: “every family will have its own different circumstances... it’s just a general theme of energy efficiency.”

Power blackouts

Earlier Mr McGrath conceded that the Government cannot give an “absolute guarantee” that power blackouts will be avoided this winter.

The Fianna Fáil TD said: “We’re going to do everything possible to ensure continuity of supply and we’re working very closely with the regulator, with the grid operator, on all of the options available to Government.

He said steps are being taken to address the risk over the medium to long term but added: “in the very short term in relation to this winter, it is tight”.

On measures to respond to the energy crisis in the upcoming Budget Mr McGrath said work was at an advanced stage.

“We are deeply concerned at the very significant escalation in energy prices. We know it’s going to present a very real problem for many thousands of households and indeed businesses.

“So at the moment we’re calibrating our approach,” Mr McGrath said.

“We will take account what is decided at an EU level later this week, and then we will make final decisions as we approach budget day.”

He also said: “we recognise it will need to be a significant intervention by Government on budget day. We want to administer supports to people as quickly as possible. It is going to be a difficult autumn and winter period.”

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Mr Ryan also highlighted this week’s emergency meeting of European Union ministers at which proposals to hit the revenues of energy companies and decouple the cost of electricity from the price of gas will be considered.

On how the proposals could benefit Ireland Mr Ryan said: “Half our electricity is made from gas, and the price there is set by what the Russians are doing so we can’t change that. But the other half, the real cost of producing the electricity, is way below what that market price set by gas is.

“So by taking that difference and giving it back to the householders that helps reduce the bills. It doesn’t cut all the cost but it can make a significant difference,” Mr Ryan said.

He said Ireland is very supportive of the proposals and added: “we hope we can get the European Council to agree them and if so we’ll very quickly apply them.” He said the effect on the market would be the same as a windfall tax.

A senior researcher in clean energy futures has warned the energy crisis “will deepen” and there will be further price increases before Christmas.

Ireland was one of the most fossil fuel-reliant countries in Europe, and there was a need to reduce this reliance as much as possible, Dr Paul Deane of Science Foundation Ireland’s MaREI Centre in University College Cork told RTÉ Radio’s Morning Ireland.

Householders should be given information on how to analyse energy loads, so they would know when the best times to use the dishwasher, the tumble dryer or when it would be best to defer use of the electric shower, he said.

“This is not about stopping everybody using energy; it is about smarter use at different times.”

Retail Excellence, the group representing thousands of Irish retailers, has warned “major intervention” will be needed from the Government on energy costs “to keep businesses’ lights on this Christmas”.

The organisation’s managing director, Duncan Graham, said “unprecedented energy bills [are] threatening thousands of livelihoods around the country. It is critically important that we see a major intervention from the Government in the forthcoming budget.”