In a major move to shield Irish households from a fresh round of inflation, Tánaiste and Minister for Finance Simon Harris has announced that he is seeking “further and targeted” measures to tackle energy affordability. The move follows warnings that electricity and gas prices are set to jump significantly over the coming months, despite a multi-million euro support package already in operation.
While wholesale energy prices had stabilized earlier in the year, recent geopolitical tensions in the Middle East and supply chain disruptions have once again pushed costs upward. Energy experts and government ministers have warned that electricity bills could rise by up to 9% starting this summer, with gas bills likely to see even sharper increases.
For the average Irish household, which already pays approximately €1,729 per year for electricity—roughly 70% higher than pre-2022 levels—this news has sparked widespread anxiety. The ESRI recently confirmed that Ireland’s heavy reliance on imported gas makes its citizens more vulnerable to these price shocks than almost any other European nation.
Speaking this morning, the Tánaiste confirmed he has asked officials in the Department of Finance to develop a range of options for the Cabinet. These measures are expected to go beyond the €750 million package announced earlier this spring. “We cannot allow a situation where families are forced to choose between heating and eating as we head into the second half of the year,” the Tánaiste stated.
The proposed measures are expected to include an extension of the reduced 9% VAT rate on gas and electricity, which was originally slated for review. There is also growing speculation about a new round of “targeted” energy credits, potentially focusing on low-income families and those in receipt of the Fuel Allowance, rather than the universal credits seen in previous years.
The government’s decision comes amid fierce criticism from opposition parties. Sinn Féin has called the existing supports “a drop in the ocean,” arguing that the government should have done more in the last budget to reform network charges and the PSO levy. Meanwhile, social justice groups have highlighted that “energy poverty” is at an all-time high, with thousands of households struggling to clear arrears from previous winters.
The National Energy Affordability Taskforce is currently working on a long-term “Action Plan,” but the Tánaiste’s request suggests that the government realizes long-term plans will not solve the immediate crisis facing voters.
Cabinet is expected to review the Finance Department’s proposals within the next fort-night. For now, the message from Government Buildings is clear: more help is on the way, but the “era of cheap energy” remains a distant memory for the Irish public.
