Irish people are now paying over €500 a year more for energy than most of the EU.

New figures from Eurostat show that Ireland has the second-highest electricity prices in the EU – almost 30% above the EU average.

When looking at the prices before taxes are included however, Ireland has by far the highest prices in Europe.

That is because Ireland’s VAT rate is significantly lower than many other EU countries.

When it comes to gas, Ireland’s prices are the fifth highest in Europe.

It means Irish households paying around €183 per year more for their gas and around €350 more for electricity.

On Newstalk Breakfast, bonkers.ie spokesperson Daragh Cassidy said one of the reasons electricity is so expensive in Ireland is our small, dispersed population.

“There’s a lot of one-off housing in Ireland,” he said. “That means the cost of the upkeep of our grids is much higher.

“If you compare us, for example, to the UK, we would have a grid that is maybe four to five times the size on a per capita basis, because we have so much one-off housing – there’s consequences to that.

Weak grid

Mr Cassidy said another reason is “economies of scale”.

“A lot of our power plants, they're smaller, they're not as efficient as other power plants in other countries - we have a weakly connected grid,” he said.

“What that means is a lot of our electricity is generated in Ireland.

“In some ways, that's great from a security point of view, but it means we can't import a huge amount of electricity from other countries, where it's cheaper.

“We have one grid connection with the UK.

“Now we are building another one with France, the Celtic interconnector - that's coming on stream in 2027 and will hopefully help things.”

Bar chart on electricity prices for household consumers. 27/10/24 Image: Eurostat

Mr Cassidy said another reason for high prices is that electricity prices are similar to housing prices – there is a “supply and demand” element to them.

“We have a lot of pressure on the grid as a result of data centres and increase in the population,” he said.

“In order to meet demand in recent years, we've had to procure last minute, high cost, high emission, emergency generation, electricity generation, and that's a push up prices.

“Finally, we still rely on gas to deliver electricity, whereas other countries tend to rely more so on hydro or nuclear.”

Switching

The communications expert said Ireland has a “competitive market” for electricity and it is worth looking into switching providers.

“I think in Ireland, a lot of the issue is on the generation side, it's not necessarily on the retail side,” he said.

“That's not to say some of the retailers and the suppliers couldn't be selling a bit cheaper, but people can switch.

“Our prices are 30% above the EU average, but you could get prices actually slightly below the EU average if you were to switch, that's because you can get a discount of up to 30% or more for a year.”

“It’s not dissimilar to what you have to do, unfortunately, with a lot of utilities, if you want to get the best deals, you usually have to switch."

Mr Cassidy said another thing people can do to save money on electricity is to make use of a smart meter.

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Main image: Powerlines in sundown. 21/02/17 Image: Heinz Tschanz-Hofmann / Alamy Stock Photo