Hundreds of thousands of consumers are going to see their bills rise in the coming weeks with SSE Airtricity to increase its household gas and electricity prices after wholesale energy prices shot up again in January.
The cost of electricity on the wholesale market in January was 67.8 per cent higher than it had been at the same time last year, reaching its highest level in more than two years. Wholesale gas prices increased significantly over the winter too.
SSE Airtricity said the price hikes will see a typical electricity customer’s bill increase by 10.5 per cent, while a typical gas customer’s bill will rise by 8.4 per cent.
The company is one of the biggest energy providers in the State. It has about 460,000 electricity customers on the island, as well as 310,000 gas customers. The increases will take effect from April 2nd.
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The change will see the average electricity bill increase by about €172 per year, while a typical gas bill will go up by €113.
Dual fuel household bills will increase by 9.5 per cent on average, equivalent to around €285 per year.
The supplier cited the wholesale costs as well as increased network transmission charges – or grid fees – as reasons for the hike.
“We know this news will be disappointing for customers,” SSE Aitricity managing director Stephen Gallagher said. “Network charges increased by around 20 per cent in October and wholesale costs are 18 per cent higher compared to this time last year.
“While we shielded customers from the impact of increased networks and other costs for six months, including the winter months, such regulatory charges are outside of our control, and we can no longer absorb these costs.”
Daragh Cassidy, spokesman for price comparison group Bonkers.ie, said the increases would be “unwelcome” for households, but were not altogether unexpected. “In recent weeks wholesale gas and electricity prices have increased significantly again,” he said.
“Last autumn, the CRU also sanctioned a big increase in network charges or grid fees for the upkeep of the electricity and gas networks, and some of that increase is now being passed on to consumers as was always feared.
“The only small reprieve is that this hike is coming at the end of winter when energy bills typically become less of a burden for households.
“Before today, SSE had the lowest standard rates in the market as it was one of the few suppliers to reduce prices three times over the past two years. So even after this hike, its prices will remain relatively competitive.”
Mr Cassidy added that the question now is whether other suppliers will follow suit.
“Despite today’s news, there is still good competition among energy suppliers in Ireland for new customers and many are offering big discounts for a year to those who switch,” he said.
