Price changes
As a business energy user, you’ve likely been monitoring the energy market and no doubt have heard a significant amount of media commentary.
The last two years have been a period of unprecedented market volatility, with cost of global energy rising sharply. The primary factor that contributed to the increase in energy prices was the war in Ukraine and the reduction in gas supplied to Europe from Russia in the period preceding the invasion and since then. This increased the requirement for Europe to import energy from alternative sources at much higher prices.
While natural gas was the main energy commodity affected by the war, it continues to be a key input into the price of electricity in Ireland so higher gas prices influence the electricity market. However, in recent months we have seen a marked decrease in wholesale prices as the uncertainty around supply last year dissipated and alternative supplies were exploited.
With increasing costs for Networks running the nation’s gas and electricity systems, pass through charges have increased for the coming year (2023/2024) for both gas and electricity.
For further information please see CRU for Electricity and Gas.
At Bord Gáis Energy, we understand that that this is not welcome news and that your business may be facing many challenges, but we want to assure you that we’re still doing all we can to help our customers.
PSO Change
The Public Service Obligation (PSO) is mandated by the Irish Government and approved by the European Commission. Due to current electricity market price trends and volatility a higher PSO payment will be required in 2024/2025. Given the relatively smaller payment that would be due to customers for the coming PSO year 2023/24, the CRU has decided to use this to mitigate some of this volatility. This will result in the PSO levy being set to zero from 1 October 2023 to 30 September 2024.
For further information please visit cru.ie.
The PSO rates for businesses from 1 October to 30 September 2024 are:
- PSO where MIC < 30kVA = €0
- PSO where MIC => 30kVA = €0
What are Pass-Through costs?
Pass-Through costs are set by ESB Networks / EirGrid / SEMO (TUoS, DUoS, Market Operator, Imperfection Charges).
Network charges in both gas and electricity are increasing from 1 October 2023.
For more information see: Business Tariffs explained
Why are energy costs remaining high?
The last two years have been characterized by significant volatility in energy prices. Only in the past 9 months are we beginning to see energy prices falling but there are range of factors keeping the energy costs at relatively high levels such as:
- Significant reduction in imports of Russian gas has increased Europe’s reliance on Liquefied natural gas (LNG), making prices more sensitive to the cost of LNG across the globe
- Risk of demand spikes if there is a cold winter in Europe. Without Russian gas, the flexibility of the market to cope with prolonged demand is reduced
- Remaining dependencies on Russian gas flows to Europe via pipeline and LNG
- Europe’s reliance on a smaller number of suppliers has increased the supply risk in the gas market
- Increased shift to renewables and away from fossil fuels at higher costs
While this continues to be a difficult time, Bord Gáis Energy has over 45 years’ experience in the energy market. We are part of the Centrica group and we promise to do our best to find a way through these unprecedented times with our customers.
Carbon Tax
The 2010 Finance Bill introduced a carbon tax to be applied to mineral oils, natural gas and solid fuels supplied for combustion in Ireland.
If you’re a gas customer, your carbon tax for natural gas will be increasing from 1 May 2023 to €0.00877 per kWh (ex VAT). For further details see ‘Your guide to Budget 2022’ on www.finance.gov.ie.
We're here to help
If you’re worried about meeting your energy repayments on receiving your next bill, please call us on 01 611 01 92. We can offer you flexible payment options that work for you and your business.
Depending on market conditions, we've also a range of fixed gas and electricity price plans for all meter types that can protect you against the volatility in the market. Call our Business team on 01 611 01 33 to see what options best suit your business.
If you have any questions, please feel free to contact us on 01 611 01 33, Mon-Fri, 8.30am – 6.30pm or email us at businessdirect@bordgais.ie. We’ll be happy to answer any questions and work this through with you.
We understand this might be a challenging time for your business and we'll continue to be here to help in any way we can.