Energy prices are on the rise in Ireland — but what can you do?

Energia announced last week that it will increase its gas and electricity prices from April 5. Residential electricity prices will rise by 8.6%, while gas prices will go up by 5.7%.

The increase will add just over €100 a year to the average household’s annual electricity bill and around €48 to the average annual gas bill.

At around this time last year, Energia, along with most of the other energy providers, actually reduced their tariffs. This time however, increased network transmission charges and increased international energy prices are being cited as the reasons for the price hikes.

Daragh Cassidy, head of communications with independent price comparison and switching website Bonkers.ie, points out that Energia is the now fourth supplier to announce a price hike in the last few weeks.

“Last winter’s price freeze has well and truly come to an end for many customers as we move into spring and all eyes are now on the country’s biggest gas and electricity suppliers, Electric Ireland and Bord Gáis Energy, to see what they do.”

Today’s price increase follows recent price hike announcements from SSE Airtricity, Pinergy and Glowpower. “Energia is one of biggest energy suppliers in Ireland behind Electric Ireland and Bord Gáis Energy so this increase will be felt by many customers nationwide,” says Mr Cassidy.

“And it comes at a time when energy use at home has probably never been higher due to us all being stuck indoors due to lockdown, and when many might be struggling financially due to losing their job. The saving grace is that the increase doesn’t come into effect until April, when hopefully the weather will be a bit milder and the evenings brighter.”

Energy prices fell dramatically at the height of the pandemic but began to tick higher as the world economy opened up. On top of that, Mr Cassidy says that the energy regulator has in recent months raised the charges for maintaining and running the country’s gas and electricity networks.

“These charges make up around 30% of the price we pay for our energy and the increase is now unfortunately being passed on to customers too.”

Households looking to offset the price increase are advised that the quickest and easiest way to save money on their energy bills is to compare prices and switch to a cheaper supplier.

“At the moment someone who is paying standard rates and who switches supplier could save themselves around €500 a year on average,” says Mr Cassidy. “It’s super quick and easy to switch and can all be done online in the space of a few minutes. Businesses seldom reward loyalty so if you want to get the best deals and the best prices, whether it be for your energy, broadband, car insurance or your mortgage, you have to be prepared to go find them.”

SSE Airtricity announced at the end of February that it intended to increase its residential gas prices by 4.5% and its residential electricity prices by 6.2% from April 1st. They too cited increased network transmission charges as the reason for the hike.

And on March 1, Pinergy announced that it would increase its standard residential electricity prices by 4.2% on April 1. If you’re a Pinergy customer, the 4.2% change will result in a standard unit rate increase of 1.1c. This translates to an average increase of approximately €53 for a typical household’s estimated annual bill, based on average energy consumption figures.

That’s the bad news. The good news is that the national roll-out of smart meters is now well underway. The plan is to have every premises in Ireland upgraded to a new electricity meter by 2024. And with the rollout of smart meters comes the launch of smart electricity tariffs.

“Unlike older meters, smart meters can communicate directly with your energy supplier and send them real-time data about your energy usage. Data will usually be sent over to your supplier once a day around midnight. However, you’ll have the option to provide data on your consumption to your supplier every 30-minutes if you want, allowing for more valuable insights into your energy usage.”

Smart meters will allow you to see exactly how much energy you’re using in real-time via an in-home display unit, a smartphone or a tablet. This means you’ll have way more information and insight into your energy usage throughout the day, which should help you to reduce your consumption.

Because smart meters can communicate in real-time, they will also bring an end to estimated bills. Moreover, ESB Networks won’t have to come visit your home to take a meter reading four times a year. Instead, each bill will be based on accurate, up-to-date energy usage — meaning you’ll only ever pay for what you’ve used.

“Your monthly or bi-monthly electricity bills will also become smart too,” says Cassidy. “Your bills will provide information on energy consumption, year-on-year comparisons of your energy usage, helpful graphs, as well as hints and tips to help you manage your energy better.”

Smart meters will give you access to a wider range of tariffs and services, many of which could save you money. “Back in 2009, around 8,000 smart meters were installed around Ireland as part of a trial to test their effectiveness. The results showed that households were able to reduce their consumption by up to 3% on average, but in some cases reductions of as much as 8.8% were recorded during peak times.”

If the trial is anything to go by, you should be able to save money with a smart meter. The Commission for the Regulation of Utilities estimates that households should be able to save about €20 to €30 a year through reducing their energy consumption alone.

To coincide with the rollout of smart meters, smart tariffs or ‘time-of-use ‘tariffs are being rolled out by some of the main electricity suppliers. These could help households save even more money on their bills.

At the moment, unless you have a night saver meter, you’re charged the same price for your electricity throughout the day. With the rollout of smart meters, energy suppliers will be able to offer consumers electricity deals with different tariffs to encourage you to move your energy usage to times when electricity is cheaper to produce.

The rollout of smart meters began in Cork, Laois and Kildare in late 2019 and expanded to parts of Dublin and Meath at the beginning of 2020. It will continue on a phased basis until 2024, by which time every home, farm and business in Ireland should have a new smart electricity meter installed.