The increase was announced in the December 2011 Budget and is a Government tax. We have no control of the setting of carbon tax prices. All gas suppliers are obliged to pass on this charge to its customers.
The new rate will be effective 1st May 2012.
The new carbon tax is levied at a rate of €20 per tonne of CO2. This translates to natural gas as a rate of €0.00370 (ex VAT) or €0.00420 (inc VAT) per kWh consumed. All suppliers of natural gas in Ireland must levy the carbon tax charge on its customers.
Yes, carbon tax is subject to a VAT rate of 13.5%.
No, electricity is not subject to this carbon tax because the cost of carbon is already built into the electricity price.
The carbon tax is a Government tax introduced in the 2010 Budget applicable to all CO2 emission sources. The carbon tax was levied on natural gas customers from the 1st May 2010.
The imposition of a carbon tax is seen by Government as an effective way of encouraging behavioural change by incentivising companies to bring low carbon products and services to the market. Natural gas is the cleanest of all the fossil fuels as it has the lowest carbon content of any fossil fuel.
For the average residential customer (based on usage of 13,800 kWh per annum – as per CER guidelines) the carbon tax increase means an additional €14.63 annually or €2.44 per bi monthly bill. This represents a 1.67% increase in an average customer's natural gas bill.
For any consumption prior to 1st May you will be charged at €0.00314 (inc VAT) per kWh. Any consumption after 1st of May will be charged at €0.00420 (inc VAT) per kWh.
Further details about the carbon tax can be found at www.revenue.ie which includes information on the carbon tax methodology, figures and calculations.