|
Electricity customers will have to pay 60 million extra
for wind power and 90 million more for peat generation from
next autumn, if a proposed levy on energy bills is introduced.
The Commission for Energy Regulation (CER)
is proposing to introduce a public service obligation on all
electricity bills to pay for incentives for green energy and
to support peat-fired power plants.
The measure is likely to lead to electricity consumers paying
a combined total of 195 million extra for 12 months from
October, which means the electricity generated from these
sources costs 195 million above the market price.
Wind energys share of this is 60 million. Wind generators
are paid a guaranteed minimum price as an incentive to attract
investment in green energy. The guaranteed price paid to such
generators means that the wind power on the system will cost
60 million more than the market price.
Price supports for peat-fired electricity generators come
in at 90 million.
Customers are not currently paying a public service obligation,
as electricity prices were high enough to support green energy
and peat. However, the market price for electricity has fallen
- partly because oil and gas costs have dropped over the last
two years - and also because demand has eased.
This means that the regulator has to re-introduce the charge.
It is estimated that the levy will cost the average household
an extra 40 a year.
Large industrial users are likely to have to pay 86 million
extra, which could mean a five-figure increase for individual
companies.
The public service charge covers wind, peat and contracts
for electricity sold by Aughinish Alumina and Tynagh Energy,
who will share 20 million.
The breakdown is - peat, 90 million; wind, 60 million;
contracts (Aughinish/Tynagh), 20 million; other, 25 million
- for a total of 195 million.
The Government recently introduced
a carbon windfall tax, from which it expects to raise
75 million from power plants and it intends passing this
money back to large energy users, as most of them are big
employers, to ease their costs.
However, Viridian Power and Energy, the independent power
supplier which operates the two Huntstown power plants in
Dublin, has warned that the carbon windfall levy will increase
energy bills.
The company said in a statement that it will distort the
market and inhibit competition and argued that it is unfair.
The levy targets a small number of generators in the market,
which include the main private investors Viridian and Endesa,
the company said.
It added that those with lucrative public service contracts
- such as Tynagh Energy and Aughinish - will be excluded from
the windfall tax.
Source - The Irish Times
|
