Around 125,000 Electric Ireland customers have fallen behind with their energy bills, its executive director, Pat Fenlon, told politicians on Tuesday.
Addressing the Joint Oireachtas Committee on Environment and Climate Action, Mr Fenlon predicted that Electric Ireland’s wholesale electricity costs would soar to €2 billion this year from €300 million in 2020.
He told members that around 125,000 of the State-owned company’s customers have fallen behind with their bills, an increase on the 100,000 who were in arrears during Covid-19. Pre-pandemic the number in debt was around 150,000.
The business has 1.27 million customers, 1.1 million of them households, implying that around one in 10 are in arrears.
Mr Fenlon stressed that Electric Ireland only cut homes or businesses off as a last resort. “There is a regulatory moratorium on disconnections for the winter period for vulnerable customers,” he noted in his opening statement.
He said the company would review a €3 million hardship fund meant to aid customers struggling to pay bills. “And we will review how we can help customers over the winter period,” he added.
Charities St Vincent de Paul and the Money Advice and Budgeting Service (MABS) administer the fund and issue energy credits to customers.
Electric Ireland is part of the ESB Group, which owns generating plants. However, regulations demand that both businesses operate separately, so ESB cannot use profits from power plants to offset Electric Ireland’s rising costs.
Data centres
Meanwhile, Joe Duignan, ESB Networks regulation and commercial manager told the committee that the company had connected no data centres since the Commission for the Regulation of Utilities (CRU) introduced new rules guidelines for this last November. “We have issued no connections offers to data centres since then,” he confirmed.
Under that system, ESB Networks and national grid operator, Eirgrid, must take into account a data centre’s location, whether it has a backup generator that can supply electricity and whether it can reduce energy demand at peak times when they consider applications for connections.
Electricity and gas customers may have to foot the bill for the cost of ensuring that 100,000 clients of three businesses that left the Irish market, Panda Power, Bright Energy and Iberdrola, continued to get energy supplies.
Electric Ireland and Bord Gáis Energy acted as suppliers of last resort, meaning customers of the three businesses that left transferred to them, unless they chose other options.
David Vickers, Electric Ireland’s pricing and trading manager, said that the company was in talks with the CRU on compensating it for taking on this role. “The costs will be socialised across the whole market,” he said.
The regulator confirmed that suppliers of last resort and network companies could seek to recover any costs that arise when businesses leave the market.
Regulators have not decided on a mechanism for this, but it will be passed on to all electricity customers and possibly added to the standing charge, or network cost, on their bills. This is unlikely until the regulator decides on network costs for 2023/24 period, which begins next October.
