Dáil Éireann Debate, Tuesday - 6 March 2012
319 Deputy Timmy Dooley asked the Minister for Communications, Energy and Natural Resources in view of the global cost of competitive pressures on large multinational employers here, if he will consider maintaining and extending the current level of large energy user customer credits beyond 30 September; and if he will make a statement on the matter. [12179/12]
View answerThe provision of secure, sustainable and competitive energy supplies is critical for the economy and for business and mitigating energy costs where possible remains a key priority. Global gas and oil prices have risen sharply since the start of 2011 driven by events in North Africa and Japan and high demand from China and India and other emerging economies.
Given Ireland's heavy reliance on imported gas and oil and small peripheral market size, the economy is a price taker in the global fossil fuel market and vulnerable to fossil fuel price fluctuations. Competitor countries are in many instances facing the same prospect and the objective in the context of higher global prices is that Ireland retains and where possible improves comparative competitiveness in terms of energy costs. I am committed to working with enterprise and with the energy sector to ensure that the costs of energy are as competitive as possible through those measures at our disposal, including sustained focus on energy efficiency and renewables to reduce our dependence and therefore lower our vulnerability to global price increases in such fuels.
The latest analysis of data published by EUROSTAT for electricity and gas prices is published by the Sustainable Energy Authority of Ireland (SEAI) and covers the period January to June 2011. The figures show Irish electricity and gas prices performing well at that point by reference to the EU average for medium to large business customers (above 2,000 MWh/annum). The VAT-exclusive electricity price in Ireland for these businesses ranged from 10% to 17% below the EU average and from 13% to 19% below the Eurozone average. The category includes the large multinational employers. The SEAI data also show that prices for business customers of gas were below the EU average by 4% to 25% for most business gas categories.
The Electricity Regulation (Amendment) (Carbon Revenue Levy) Act 2010 provided for the introduction of a Carbon Revenue Levy, payable by fossil fuel generators of electricity, the proceeds of which have been utilised for rebates to Large Energy Users (LEUs) to mitigate their electricity costs.
A recent Supreme Court judgment has found against the Commission for Energy Regulation's prohibition on the Carbon Revenue levy from being "bidded-in" by generators to the wholesale price of electricity in the Single Electricity Market. The consequences of the judgement are that generators will henceforth bid in the cost of the levy with potential impact on prices for the duration of the levy, which, under the Act, is due to cease at the end of 2012. My Department is assessing the judgement from all relevant policy perspectives in consultation with the Office of the Attorney General.
