Electricity & Gas

Tariff Review 2022_2023 - Response and Decision Paper

Electricity Network Tariffs 2022/23 – National Energy Security Framework Response Proposals

The CRU has published its final Decision on Electricity Network Tariffs for October 2022 to October 2023. This follows a public consultation which closed on 01 September 2022.

As indicated in the consultation document published in August, there will be an increase in overall network tariffs resulting primarily from the impacts of inflation and the funding of responses to the security of supply challenges Ireland is facing.

A number of key measures were proposed in the consultation document. The following summarises the updated position on the measures proposed which are set out in the final Decision now being adopted by the CRU.

  • In line with the developing policy response from the European Commission, the CRU has decided to implement a number of demand response measures. This includes an acceleration of ESBN’s Beat the Peak scheme for both domestic and commercial customers. Suppliers are requested to develop demand response and energy efficiency initiatives and report to the CRU on these.
  • EirGrid will develop a process for communicating forecasts of system alerts and periods of low renewable generation to suppliers and customers to facilitate demand response.
  • In the context of feedback received during the consultation process on potential responsiveness to, and impact of, certain measures and informed by the draft European Commission Emergency Regulation , the Commission will not be implementing the Block, System Stress or Decarbonisation tariffs at this point in time. The €100 million proposed to be allocated to the new tariffs will now be recovered across all customer groups.
  • Peak pricing will be implemented across a number of small and large-scale consumer segments, resulting in a 10% increase in network charges during the peak period of 5pm-7pm, in alignment with the draft European Commission Emergency Regulation currently in development, and our National Energy Security Framework. This 10% increase during peak periods is offset by a corresponding decrease during off-peak periods. This is designed to act as an incentive to suppliers to promote appropriate off-peak products and services to customers.
  • The Large Energy User rebalancing subvention paid by domestic consumers, initiated during the last recession, will be unwound. This mitigates other increases in costs by an estimated average of €40 for the year for domestic consumers (-12%) as a direct result of the CRU’s decision to unwind LEU rebalancing.
  • Other demand response measures, outside of the network tariff consultation, will continue to be pursued including Mandatory Demand Curtailment targeted at high voltage consumers and Voluntary Demand Reduction (during times of system stress); enhancement of signals to Demand Side Units in the Single Electricity Market; communications exercises (behavioural campaigns and reactive alert notices in times of system stress); and other measures which may arise following the finalisation of the European Commission Emergency Regulation.
  • The CRU will continue to monitor the delivery and performance of demand response and flexibility over the coming Winter, with the support of the ESRI and the network companies. The result of this analysis will feed into future actions should the combination of the above interventions not result in sufficient demand response.
  • The new tariffs and charges are expected to be implemented from 1st October 2022, with pass-through of these costs varying across individual suppliers. Over the course of the year, it is expected that the net effect of the above changes will be to increase domestic bills by approximately €41 per annum.
  • In parallel, the CRU Decision to bring the PSO Levy to a negative value will result in an annual net saving of approximately €140 per annum for domestic consumers; and an annual saving of €475 for small commercial customers in the coming year. The PSO levy will initially be set to zero from this October, and for the first number of months of the coming tariff period of 2022/23, with the negative rebate to customers being delivered following the finalisation of the required implementing legislation and arrangements.