Price increases for gas and electricity announced by Bord Gáis are difficult, but reflect the underlying volatility of wholesale prices in the market, according to the chairperson for the Commission for Regulation of Utilities (CRU).
Aoife MacEvilly said: “Even with competitive pressures, the reality is we’ve got very high and volatile wholesale gas prices, which is putting upward pressure on prices.”
Yesterday, Bord Gáis Energy said the average electricity bill will go up by 27% and the average gas bill will go up by 39%.
The company is ending its ‘winter price pledge’ and the changes will take effect from 15 April.
Ms MacEvilly said there are protections in place for customers and people should register as a vulnerable customer if they need to.
She also urged people to contact their providers to see if they can get a better deal on their bills and examine their bills to see if they can make savings by using some appliances at different times.
She said that arrears are growing and some customers are in real difficulties and the CRU is looking at enhancing protections, with actions including increased protections against disconnections and enabling customers to get onto payment plans.
“Some of the concerns we have is that maybe customers, for instance, don’t read their bills and maybe aren’t fully informed about how they use energy.
“All suppliers now offer Time Of Use tariffs for customers with smart meters. So you can think about how you might use energy in a different way, using cheaper electricity at night, for example, or at weekends to mitigate against the high prices,” she said.
Ms MacEvilly said the CRU does not regulate prices in the energy market but will examine every option that might have a better outcome for customers.
She said a price cap in the UK is rising by over £700 to an average of £2,000 from 1 April.
“Unfortunately price caps and competition cannot avoid or mitigate against the fact that prices on wholesale markets have risen to many, many multiples of what they were just a few short months ago,” she said.
Age Action’s Senior Public Affairs and Policy Specialist Nat O’Connor said he was shocked by the scale of the price increases announced by Bord Gáis.
However, he said it is part of a pattern seen over the past year and energy prices had risen by 20% before the Russian invasion of Ukraine.
He said Age Action is concerned that older people will not be able to heat their homes or will have to choose between heat and another essentials such as food.
Mr O’Connor said many older people have a real reliance on fossil fuels and many cannot afford to make the switch away from them.
Many are also living in poorly insulated homes, but only a third receive the fuel allowance, he added.
Nat O’Connor said the moratorium on disconnections remains in place and utility companies have vulnerable customer helplines that people should avail of.
But he warned that in the longer term the fact remains that people cannot afford to pay their energy bill.