Bord Gais announces massive energy price hike as Eamon Ryan urges households to reduce fuel use and consider switching

BORD Gais has become the first energy supplier to announce a price increase this year, with a major increase due next month.

The company is increasing its average electricity bill by 27 percent and its average gas bill by 39 percent since April 15.

The increase would add around €350 a year to the average household’s annual gas bill and €340 to the average annual electricity bill.

But this comes from price increases that have increased people’s electricity and gas bills by around €540 since autumn 2020.

Bord Gais raised electricity prices three times last year, and gas prices twice.

The move is expected to exacerbate the cost of living crisis that is hitting the country.

Taoiseach Michael Martin today acknowledged that rising prices will hit the poorest families hardest.

However, before the massive price increases, Minister Ryan said that the Government could not help but implement every price increase.

“We can’t afford every single increase in costs,” said Secretary Ryan.

“The most important measure is to try and start reducing the use of these fuels. Switching to springs will help, the use of gas will naturally decrease in the heating sector. “

Secretary Ryan was speaking to reporters in Washington DC, where Taoiseach said “the entire population” cannot be shielded from the impact of the war in Ukraine.

“Certainly we cannot protect the entire population from the full impact of this war,” he said.

“We will do everything we can to protect those with the lowest incomes and those under the most pressure.

“The idea that we can continue to produce a package of 1 billion euros every two weeks… there are limits to what the government can do, that is what I am saying.”

“Governments will not be able to fully protect citizens from this shock. It is a new reality, it is a reality brought about by war in continental Europe,” he added.

The government said it would consider other possible measures to support consumers and businesses after the Bord Gais price hike.

The European Commission is expected to report back on any possible cuts to VAT or further cuts to rising gas or fuel prices by the end of the month, it said.

The Commission is then expected to present its proposals by the end of May and Mr Martin says the Irish Government has pushed for “more flexibility” with respect to the EU’s energy and VAT directives.

Environment Secretary Eamon Ryan is said to have informed ministers of the price increase just before it was publicly announced at a Cabinet meeting that took place almost today as ministers were scattered around the world. for Saint Patrick’s Day.

In a statement released later, the Government said it would keep energy supply and prices “closely and positively reviewed and consider other possible measures to support consumers and businesses”. Karma”.

The government says it has raised the possibility of reducing VAT on fuel to below the current lower level of 13.5pc with the European Commission.

“The substantial retail price increase announced by Bord Gais Energy today is an issue of strong Government concern, particularly with the impact on low-income households. Russia’s invasion of Ukraine has seen unprecedented price increases and volatility in the energy market,” the statement said.

The statement notes that the Union has taken a number of actions to lessen the impact of the price increases including a €125 increase in fuel allowances being paid to 372,000 households this week; a €5 increase in the weekly fuel allowance together with a €5 increase in the Living Alone Allowance and the Qualified Adult payment; cut 15 and 20 cents per liter of excise tax on gasoline and diesel; and €200 electricity credit.

The punitive price hike comes after global oil and gas prices surged following Russia’s attack on Ukraine, although crude prices have since fallen back to pre-war levels.

Bord Gais said it realized the increase would put a huge strain on household budgets.

It is offering additional supports and services to help partner with the Money Advice and Budgeting Service (MABS) and other charities.

Bord Gais Energy CEO Dave Kirwan, said: “We know that today’s announcement is not welcome news. As part of Centrica plc, and with decades of local experience, we will accompany our customers through these unprecedented times. ”

He said wholesale energy costs have continued to rise over the past two years, particularly over the past 12 months.

“This, coupled with the expectation that costs will remain high and volatile for some time, means we are forced to increase our prices.”

He said the company is offering an energy support fund of 1.25 million euros in addition to the services we already have in place.

The level of increase from Bord Gais is far beyond what was expected. Some pundits were expecting most power supplies to post a 10pc gain.

It comes after 35 different price hike announcements last year.

Inflation is at a 21-year high of 5.6pc.

In 2020, the average electricity bill was around €1,100, but now it’s around €1,500, up €400 before Bord Gais most recent increase.

Two years ago, the average annual gas bill was around €800, but now it’s around €1,200, an increase of €400.

Daragh Cassidy of price comparison website Bonkers.ie says the news from Bord Gais is not surprising given the sharp rise in gas prices we’ve seen on wholesale markets in recent months.

However, the scale and scale of the increase is unprecedented, he said.

Mr. Cassidy said it was the first notice of price increases from any energy supplier this year.

Last year, there were more than 35 vendors, he said.

Bonkerse.ie CEO said: “The outlook is bleak for energy customers.