Energy experts said a decrease in wholesale costs, strong supplies of liquefied natural gas and a relatively mild winter across Europe meant there would be scope for lower domestic electricity and gas prices.
A recent report revealed that Irish households pay around €360 more a year for electricity than the average across the EU.
Meanwhile, no energy credits have been paid here this year.
Today’s News in 90 – Tuesday January 13
Daragh Cassidy, of price comparison site Bonkers.ie, said there had been a slow but steady fall in the wholesale price of gas over the past few months.
The latest figures show wholesale gas prices are 37pc lower than a year ago.
Gas is used to generate up to half of the State’s electricity.
“The fall is largely as a result of strong supplies of LNG [liquefied natural gas] into Europe as well as increased optimism, perhaps misplaced, around the prospect of some type of peace deal in Ukraine. A relatively mild winter up until Christmas has also helped,” Mr Cassidy said.
But he said any changes on wholesale markets would always take time to translate into lower energy bills.
Wholesale gas prices are just one element of producing electricity and gas for households and businesses. Network fees, supplier margins and government charges such as Vat and the carbon tax also play a big role in the prices households ultimately pay.
“I’m hopeful that if wholesale prices remain close to their current levels then it should allow suppliers to drop their gas prices a bit over the coming few months,” Mr Cassidy said.
Irish people face higher bills than their European peers. Photo: Getty
But he said any changes on wholesale markets would always take time to translate into lower energy bills.
Wholesale gas prices are just one element of producing electricity and gas for households and businesses. Network fees, supplier margins and government charges such as Vat and the carbon tax also play a big role in the prices households ultimately pay.
“I’m hopeful that if wholesale prices remain close to their current levels then it should allow suppliers to drop their gas prices a bit over the coming few months,” Mr Cassidy said.
Wholesale prices are still around 60-70pc above the level they were at before the war in Ukraine.
Mr Cassidy said prices were not going to return close to the levels they were at before the Russian invasion of Ukraine.
“But Irish households are still paying around double the price for gas compared to what they were a few years back. So I think some type of relief can be expected soon,” he said.
The outlook is looking good, but things can change
Dr Paul Deane, a lecturer on energy at University College Cork, said wholesale gas prices were stable at the moment.
This means there was a prospect of small cuts in prices.
At the very least, prices may not rise this year.
“Knowing what we know, the outlook is looking good, but things can change,” he said.
He said energy suppliers looked at wholesale prices on a rolling 12-month to 18-month basis, not just where they are when compared with this time last year.
“What is more likely is that prices will remain the same this year, but there is potential for a modest reduction,” Dr Deane said.
An analysis from the Nevin Economic Research Institute shows energy prices have undergone a “massive divergence” from other consumer costs over the last decade.
It has found Irish households pay around €360 more a year than the western EU average.
The Irish Congress of Trade Unions-backed think-tank said Ireland was a significant “cost growth outlier” within the 15 mainly western EU states that were members of the bloc before its expansion in 2004.
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