Oireachtas Joint and Select Committees

Tuesday, 4 October 2022

Joint Oireachtas Committee on Climate Action

Energy Prices: Discussion

Mr. Joe Duignan:

There are a few elements to the distribution charges. As Mr. Tarrant has said, all the charges are approved by the regulator and then we charge them on to suppliers. How the supplier passes that on is up to them so they can have different bundles and packages and so on. That is different for them. With our charges, if we go back one and half years ago before the current situation with the price of electricity, typically the distribution element of the tariff for a customer would be in and around 22% or 23%, or in that ballpark. It has not moved since in terms of the euro amount. What has moved is the wholesale price of electricity. The overall bill has gone up but the distribution element has not. I would say that this 22% or 23% element has dropped significantly.

The Deputy asked about the fixed and variable elements. Again, from a distribution to perspective, our tariff is about one third fixed and two thirds variable. In other words, one third is a standing charge, on average, across customers, and the other two thirds are variable. Our actual costs for providing the infrastructure are more fixed than variable. They are quite low. In comparison with other European jurisdictions, the trend is to have higher fixed costs for the network element of the bill. That trend is going up even higher, but ours have been stable now, at about at about 30% or thereabouts, for a while.

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