Irish electricity prices have failed to decline alongside other European Union countries following the energy crisis sparked by the war in Ukraine, according to the Economic and Social Research Institute (ESRI).
The research body told an Oireachtas committee that while Irish energy costs have dropped from crisis peaks, consumers still face significantly higher bills than their EU counterparts. A May Eurostat survey revealed Irish households pay the third-highest electricity costs in Europe, spending approximately 30% more than the average EU home.
The ESRI described it as “challenging to confidently identify” why Ireland’s prices remain elevated, though it pointed to the country’s continued reliance on gas-fired electricity generation. Unlike other EU nations, Ireland has not diversified away from gas power to the same extent.
Energy Minister Darragh O’Brien acknowledged the problem stems from European-level pricing mechanisms that tie electricity costs to wholesale gas prices, regardless of renewable energy production. He has established an affordability task force and raised the issue with the European Commission, though he warned any changes would require “medium term” EU-wide discussions.
The ESRI warned that substantial electricity grid investments will be needed to meet growing demand and improve renewable energy capacity, potentially shifting costs from variable to fixed charges for consumers.