Ireland must subsidise electricity until we have the infrastructure in place to reduce prices permanently, business group IBEC has warned.
The group has said Ireland has a “unique opportunity” to invest in cheaper green energy – but prices are set to remain stubbornly high in the short -term.
IBEC has set out a series of proposals to reduce electricity costs as part of its ‘Electing for Business’ general election campaign.
The paper identified Ireland's reliance on expensive natural gas and a range of “fixed-cost” regulatory charges that can make up 50% of an electricity bill as two of the key contributors to our high energy bills.
On Newstalk Breakfast, IBEC senior executive Conor Minogue said the group wants to help reduce energy costs for all users.
“Ireland, for the last 10 to 15 years, has had some of the highest [energy] prices in Europe and the OECD,” he said.
“This is obviously a major concern given that Europe itself is uncompetitive."
Subsidies
Mr Minogue said IBEC is encouraging the Government to subsidise energy costs for homes and businesses in the short-term, while investing in other long-term measures.
“What we see is, in the long run, there’s an opportunity here – a unique opportunity – [to invest] in renewables, interconnection, storage.
“That all brings the price down, but in the short-term, the signs are prices are going to remain high.”
Mr Minogue said this could be done by reducing Government charges and levies – potentially bringing down the overall cost to consumers by about €600 million a year.
Nationwide reductions
He said the move would offer homes and businesses a significant reduction in their energy bills.
“We've done a few calculations with some businesses, and we see it's roughly 6% to 11% reduction for users,” he said.
“It changes because different users use electricity in different ways, but as I said, this would actually benefit all users across the system, including households.”
Mr Minogue said this would push Ireland closer to European norms.
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