Dáil Éireann Debate, Thursday - 11 June 2026
3. Deputy Pa Daly asked the Minister for Climate, Energy and the Environment the number of recent reports which confirm that Ireland has the highest electricity prices in the EU (details supplied); the measures he is taking to reduce prices; if he will reintroduce electricity credits; and if he will make a statement on the matter. [44296/26]
Amharc ar fhreagraThe Minister knows we have the highest electricity bills in Europe. Families are struggling with increased costs year-on-year. The Government is continuing to preside over a system where costs are driven up by poor planning, over-reliance on imported gas and an energy model that prioritises the large corporate demand, particularly from data centres, over ordinary customers. Can the Minister explain why we are paying so much, what the Government has done that allows infrastructure and policy failures to push up the prices and what reliefs it is going to provide now? I ask the Minister not to say, "the task force".
The Deputy is going to tell me what I am going to say now. The household energy price index, HEPI, report, which is referenced in the Deputy's written question, although he did not mention it in his remarks, tracks energy prices across European capital cities. When adjusted for purchasing power standard, PPS, this report shows that Dublin was the ninth highest for electricity prices in May 2026 and the 14th highest for gas prices. The report notes that purchasing power standards are an approach that eliminates general price level differences between countries. Meanwhile, the latest data from Eurostat, which compares electricity prices across the EU, shows Ireland ranked fifth highest for electricity prices and eighth highest for gas prices among European countries in purchasing power parity terms.
That is still too high. I do not deny that at all. It is important to note, however, that price setting is a commercial and operational matter for each energy supplier. Retail prices are influenced by several factors, including wholesale energy prices, system operational costs and supplier hedging. We are deeply aware, however, of the pressures placed on households and businesses by high energy costs. We have taken a number of steps to support households and businesses facing those increased costs. This includes the €750 million package of fuel supports announced in March, which is the largest per capita of any EU state. Budget 2026 had a range of other measures. These included the extension until 2030 of the 9% VAT rate currently applied to gas and electricity bills. There were also enhanced social protection payments, including an increase to the fuel allowance rate and an expansion of the eligibility rules, which applies to about a quarter of Irish households, and a record allocation of €640 million in Sustainable Energy Authority of Ireland, SEAI, retrofitting schemes. Those schemes are critically important. Since 2019, we have invested over €1.8 billion in retrofitting and we have been able to provide energy upgrades for 268,000 homes. These upgrades protect those homes and families from energy shocks and reduce their costs and energy consumption.
The Minister said, and we all agree, that energy bills are too high, whether we have the highest, the second highest or the fourth highest costs. We all know that energy companies are, of course, going to raise their bills year-on-year. They have an obligation to shareholders, and they want to make a profit not only this year but an increased profit next year and the year afterwards. The question is: when is the Minister is going to step in and tell them that enough is enough? I ask this because there is a lack of progress here. Energy suppliers had a recent spate of price hikes. One company raised its prices twice last summer. Once again, however, the Minister points to the insufficient measures, I think, contained in budget 2026. He did not, however, refer to the possibility of allocating energy credits, which we said would have been a temporary measure. The energy regulator warned that the withdrawal of these credits would lead to a spike in arrears, and that is exactly what happened. Is the Minister going to consider reintroducing energy credits as a temporary measure as part of budget 2027, given our prices are so high?
I am going to mention the work being done by the national energy affordability task force. I will report on that in July. That will give options for further changes and will feed into budgetary deliberations. I am not writing anything off regarding the budget. I will wait to receive that report. In the meantime, however, we have to ensure we accelerate the retrofitting programme I spoke about. If we look at solar, for argument’s sake, over 112,000 homes in this country now have solar systems. This reduces their bills permanently. It is also good for our climate as well as being good for people’s pockets and household bills. We want to keep accelerating this development.
Our continued overdependence on imported fossil fuel means we are going to continue to be over-reliant on them until we reach the tipping point on renewables. This means we will be at risk of volatility in the international fossil fuel markets. We are making good progress in this regard. About 50% of our electricity, month on month, is generated by renewables. We need to get that figure up to 80%. This is why we need to continue to accelerate the progress.
I am not writing anything off for the budget. We will decide that as a Government. The national energy affordability task force will conclude its work in July in advance of the budget.
Some progress is being made in offshore renewables but there is no State investment in it and we are way behind with it. Even one of the Government’s own Ministers said it had been sitting on its hands and navel-gazing about offshore wind for many years.
Who was that?
The energy credits were supposed to be just a temporary measure while the structural failures were being sorted out. It is not just Sinn Féin or other Opposition parties saying this. The International Energy Agency, IEA, has queried and called into question the huge gap between the retail price and the wholesale energy costs here. Even the Taoiseach himself has admitted that price gouging is going on. We have the biggest gap in the world and it costs three times more to buy energy here than it does to produce it. The ESRI agrees with us. It highlights that wholesale prices have fallen much more slowly here than in other European countries. I see what the Minister said about the VAT rate, the network charges and the other levies but it seems that nothing is being done to address this situation.
I have specifically asked the CRU to look at that pass-on of wholesale price reductions to retail, and that gap. I have written to the commission specifically on that matter to say it is something I want looked at. I am writing nothing off. I am not suggesting for a moment that the measures in the last budget were going to soften the blow of all price increases. They did not but they helped.
We are going to seek to help again where we can. We need to consider structural reform. I assure the Deputy, with regard to offshore renewables, that the only delay has been on the planning side. I am hopeful that we will get two planning decisions through this year and that we can move towards construction in this decade. That is what I have always said. The original plan was electrification by 2030. That was not possible because of delays in the planning process. That is why I brought forward, in the term of the last Government, the Planning and Development Act, which, I remind the Deputy, his party opposed at the time. We will be working on measures in advance of the budget, and that will be informed by the final national energy affordability task force report.
