Energy credits currently ‘highly unlikely’, Minister says

By Cillian Sherlock, Press Association

Government intervention on energy prices is currently “highly unlikely”, Ireland’s Public Expenditure Minister has said.

Consumers have seen hikes in home heating oil and motor fuel in the wake of the escalating conflict in the Middle East.

Jack Chambers said the situation around energy prices was “extremely volatile, uncertain and unpredictable” but warned that it would not be “responsible” to announce a reaction days into the crisis.

Speaking to reporters on Wednesday, he said: “The current position is that there isn’t any intervention on the table.

“We’ll assess the wider position over the weeks and months ahead to see if there’s any sustained or increasing price dynamic – but we have to be careful about what intervention we make and what impact that has on the wider fiscal position.”

Chambers said what is occurring at a retail level “has nothing to do” with the geopolitical situation and told reporters “pure opportunism” on fuel prices needed to be tackled by the State competition watchdog.

“Government will continue to assess the overall position in the weeks and the months ahead, but we won’t be taking any immediate response because it is uncertain – and we also have a new fiscal framework which we have to adhere to.”

He added: “Clearly, if things escalate to an extraordinary degree, we’ll assess that at a given point in time, but we don’t know what the medium-term position will be on this around the economic consequences, or the inflationary consequences, and how that might impact on our growth trajectory.”

Chambers also said any change of expenditure policy would have “trade-offs” in another area.

He further warned that interventions can become permanent and raise expectations.

The issue of energy prices also dominated Leaders’ Questions in the Dáil, where Chambers’ Fianna Fail party leader and Taoiseach Micheaál Martin acknowledged there was “a lot of uncertainty out there at the moment” and said “no one should take advantage of that” to increase energy prices.

“We’re keeping everything under review in terms of that price situation and impact on households.”

He was responding to Sinn Féin leader Mary Lou McDonald who said she had heard of a 94-year-old woman from Wexford whose half fill of home heating oil had jumped from €464 to €879 in the space of a week.

She added that motorists had seen 10c increases at fuel pumps as she accused companies of “clearly taking advantage of this crisis to squeeze even more profit from their customers”.

She told the Taoiseach: “You need to pick up the phone and tell the top brass in these companies to stop fleecing people.”

Martin said there should be no increase at the forecourts in relation to the situation in the Gulf, stating that impacts on prices should take a number of weeks to manifest.

He said the Commission for the Regulation of Utilities and the Competition and Consumer Protection Commission have been asked to investigate the matter.

The Taoiseach said the Government already took “very targeted measures” in the Budget, including in relation to the fuel allowance.

“One of the more fundamental challenges is the coupling of gas with renewables in terms of the price market and the structure that governs the European energy market.

“And that’s an issue that was put on the agenda two weeks ago, but will have an even sharper focus now in terms of the impact of this crisis on the energy market.”

He added: “I think it’s important the Government’s focus has been on targeting and using our resources to those most in need and those who need our support.”

He also said carbon tax receipts were used for a range of measures including retrofitting.

McDonald said this was an “exposition of the fact that you’re doing nothing”, adding: “That’s been a real subplot of the entire cost-of-living crisis.”

Labour leader Ivana Bacik said many people are at “breaking point” as the cost of essential items “skyrocketed” over five years.

She said the cost of home heating oil had gone up by 40 per cent in recent days as she urged for a cap on the price to be implemented.

She said: “No one expects you to end world war, but Taoiseach, will you act decisively to support people who are up against the wall, and will you intervene to support those who are struggling in the cost-of-living crisis?”

Martin said everything would be kept under review but argued that “price caps generally do not work”.