Energy companies exchange people with a discount of €200

A large number of households say they are being neglected by their energy suppliers after receiving less than expected in the government electricity loan.

The Energy Regulator has confirmed that it has received a number of complaints on the matter.

To help tackle the cost-of-living crisis, the government gave each household a €200 electricity loan earlier this year.

However, some households have complained that they only get a €192.08 credit on their electricity bill.

The €200 loan, intended to help mitigate rising energy costs, was listed on the bills as a €176.22 line of credit. However, the full discount should be €200 when VAT is taken into account.

At the beginning of the year, VAT on fuel bills was 13.5 percent.

In another attempt to help struggling households, VAT on energy bills was reduced from 13.5 percent to 9 percent from early May.

Some consumers say bills issued just after May had the lower VAT rate applied to the government loan, even though the billing period lasted mostly through May.

And they’re upset that some utilities have pushed back bills until April to reflect the lower VAT rate.

They say this is unfair and has let them down at a time when utility bills have skyrocketed 50 per cent over the past year.

A spokesman for the Commission for the Regulation of Utilities (CRU) said it had received a number of complaints on the matter.

When asked if this was the issue, they explained: “The government loan was made available to every eligible household electricity account from April.

“Since May 1, 2022, VAT on gas and electricity bills has been reduced from 13.5 percent to 9 percent. This VAT change affects the total amount of credit that customers receive.

“If your bill was issued before May 1, 2022, you will receive a government credit of €200 on your utility bill (€176.22 plus 13.5% VAT).”

The CRU said if the bill is issued on or after May 1 this year, households will receive a €192.08 credit on their electricity bill (€176.22 plus 9 percent sales tax).

“Please note that while this may be less than you expected as a credit, you will benefit from the reduced VAT rate on your total energy bill.”

A number of consumers have complained that applying the lower VAT rate to the loan is unfair.

One customer claimed that Electric Ireland delayed issuing their invoice until the lower VAT rate came into effect. “My billing cycle is bi-monthly through the 25th of the month,” they said. “The bill for April 25th was late which was strange. The bill came in on May 19th. VAT was calculated at 9 percent.”

ESB-owned Electric Ireland admitted it paused its billing process and reissued for May.

“As of May 1, 2022, the government reduced the VAT rate for electricity from 13.5 percent to 9 percent. To ensure our customers are charged the correct, lower VAT rate, we have paused our billing process to facilitate this change. The settlement was from 28./29. April to May 16 paused.”

It insisted that customers would only be billed for a normal 60-day billing cycle.

“In these cases, a customer’s next bill will be issued in a shorter timeframe, but again only involves the use of a normal billing cycle of approximately 60 days,” Electric Ireland said.

How do I know if I received the full €200 credit?

All domestic electricity customers should receive a credit of 200 euros.

The credit is €176.22 before VAT.

It will be paid to all domestic electricity accounts on bills issued through April and May.

If your bill was issued before May 1st, you should have received the full €200 government credit on your utility bill. This consists of the credit of €176.22 plus VAT at 13.5%.

VAT on energy bills has been reduced to 9 pcs from May 1st. This means that if your invoice was issued on or after May 1st, you received a credit of only €192.08, made up of the payment of €176.22 plus VAT for 9 pcs.

You may find that your supplier canceled the original government credit and re-credited your account at the lower VAT rate.

You should be able to determine how much credit you received by checking your bill.

The Commission for the Regulation of Utilities (CRU) oversees the system.

Complaints can be made to the CRU at Energy companies exchange people with a discount of €200

Fry Electronics Team

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