Ireland's Electricity Prices Highest in EU, CEO Cites Gas Reliance and Market Size

Dara Lynott, CEO of the Electricity Association of Ireland, stated that Ireland's electricity prices are influenced by market size and the country's reliance on gas. This follows Eurostat figures showing Ireland had the highest household electricity prices in the EU in the second half of last year, at 40.42 cent per kilowatt-hour, nearly 40% above the EU average of 28.96 cent.

Lynott explained that while Ireland's prices were 1.5 cents per kWh higher than Germany's, adjusting for purchasing power places Ireland as the fifth most expensive. He noted that approximately 50% of Ireland's electricity generation comes from gas traded on energy markets. The country aims to transition to 80% renewables, requiring significant investment in offshore and onshore wind energy, grid expansion to connect 100,000 houses, and ensuring temporary emergency generation.

Increased renewable use is already showing benefits, with wholesale electricity prices dropping by 60% on windy days. Lynott emphasized the need to accelerate renewable development to achieve cheaper electricity more frequently. He also clarified that grid fees, roughly a third of the average bill, are collected by suppliers and passed to entities like ESB Networks, the government (taxes), and foreign fuel suppliers. Energy companies are investing €2 billion annually until 2030 to build renewable infrastructure and batteries, facilitating the transition from fossil fuel dependency. Lynott advised customers to actively seek better rates from suppliers, noting that only 30% of 2.1 million smart meters are activated.