ENERGY COSTS:Large numbers of people are finding it impossible to pay their increased electricity bills, but claiming a grant for insulating a house is a way to get some money back from the State, as well as to cut long-term costs
ONE OF the most depressing and shocking things about the downturn has been the number of people who have had their electricity cut off because of an inability to pay their bills in recent months. Almost 2,500 households a month – or 80 a day – had their supply disconnected by the ESB, Bord Gáis and Airtricity in the four months to the end of July, according to the Commission for Energy Regulation.
Many of these people had good jobs only two years ago but now find themselves in a position where they can no longer pay for the most basic services. Anyone who has found it tough to make ends meet this year will have been dismayed to read last month that, in spite of the fact that energy prices are stable on the international market – if anything, they are falling – the cost of domestic electricity is set to rise by 4.9 per cent next month.
The increase is to pay for the public service obligation (PSO) levy and the money raised will support home-produced and renewable energy sources. The Bord Gáis Energy Index, which measures prices in the wholesale energy markets, fell by 2 per cent last month to its lowest point since April. Natural gas fell by 7 per cent, while coal and electricity prices also fell, and analysts have predicted that energy prices are unlikely to rise in the coming months.
There is one way that some Irish consumers can get their own back in the face of these Government-generated price hikes, and that is through payments from the Sustainable Energy Authority of Ireland (SEAI), to which they are entitled if they upgrade their home’s energy ratings.
As many as 1,000 Irish homes are getting payments from the State every week to upgrade their energy ratings, according to the SEAI. Grants of up to €4,500 are available for roof insulation, wall insulation (which includes either cavity wall, internal dry lining or external insulation), the installation of a high-efficiency gas- or oil-fired boiler and an upgrade of heating controls or the installation of a thermostat. Roof insulation – which can be completed in less than a day and costs around €800 – is worth €250 in grants, while cavity-wall insulation, which costs in the region of €1,000, will get you €400.
External wall insulation is a significantly more labour-intensive and time-consuming process and will take more than three weeks to complete for an average-sized house. It costs around €15,000 for a three-bedroom semi, but a grant of €4,000 is available.
Of course, getting the grant is not without complications – a pre-approved contractor has to be employed and, once the upgrade has been done, forms need to be filled out before the grant can be applied for. At least, that is the current position.
One of the downsides of the SEAI grants is that householders have to come up with the cash and then get a rebate. For most of us, getting access to €14,000 from a bank is not easy. Problems with credit is one reason why the grants look set to be replaced by a discount-based scheme which will, according to its cheerleaders in the Department of Communications, Energy and Natural Resources, reduce the amount of energy needed to power the country and allow consumers improve their energy rating without stumping up the cash upfront.
A consultation document says customers are more likely to undertake energy-saving measures under this scenario. It has been described as the “most innovative, ambitious, energy-related initiative ever introduced in Ireland” and could reduce our energy use by 8,000 gigawatts over the next decade. The measures are designed to make “Ireland a cheaper, more competitive and environmentally friendly country”, according to the document.
There are, of course, easier ways to knock substantial sums off your annual energy bill, particularly if you are still an ESB customer. Recently Pricewatch got into a small row with an otherwise bright person who declared that they were sticking with the ESB this winter.
We are not set against the ESB, nor do we have any love for their rivals, but by switching to Bord Gáis Energy or Airtricity, consumers will knock at least 10 per cent off their annual electricity bill. And switching is genuinely easy. More than 680,000 customers have already changed their electricity supplier since the market was liberalised 18 months ago, so the people who have stayed with the ESB are effectively just throwing money away.
No infrastructural changes are needed to switch provider, so people can move from one provider with ease. And if the service offered by one of the ESB’s rivals is not up to scratch, switching back is simple.
The Commission for Energy Regulation (CER) sets prices for the ESB, but its competitors are allowed to undercut these charges. The CER has said it will deregulate the domestic electricity market when the ESB’s market share falls to 60 per cent, which is expected to happen by early next year.
Five ways to reduce your electricity bills
1 ENERGY-EFFICIENT LIGHT BULBS
Switch to these and you will see your lighting bills fall by a staggering 80 per cent. While the bulbs in the past were weak and anaemic, they have improved dramatically in recent years.
2 NOT SO HOT I
Washing your clothes at 40 degrees instead of 60 uses 40 per cent less power and you will not notice any difference in the quality of the cleaning.
3 NOT SO HOT II
Turning your thermostat down by just a single degree will knock as much as €120 off your annual heating bill.
4 INSULATE YOUR ATTIC
This will cut your heating bill by 25 per cent while lagging your hot water tank will save the average house €2.50 a week – if you live for the next 50 years lagging today will save you €6,500.
5 STANDBY COSTS
Leaving the TV and stereo on standby and the mobile phone charger plugged in will cost you around €100 in wasted electricity every year. Leave the computer plugged in for a while so you can carry out a home energy audit on .powerofone.ie.
