Bills mount for householders in Northern Ireland as Power NI announce 21.4% electricity hike

The latest in a series of utility price hikes – this time a 21.4% electricity tariff increase by Power NI – will have an adverse impact on already struggling householders.
Power NI's tariff increase will take effect from January 1Power NI's tariff increase will take effect from January 1
Power NI's tariff increase will take effect from January 1

That is the view of Northern Ireland’s Consumer Council after the announcement by the Province’s largest energy supplier.

It follows a soon-to-be-implimented price rise of 9% from SSE Airtricity and a hike of 29% from Budget Energy.

Firmus Energy is also increasing its gas prices by 38%.

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Power NI’s tariff increase will take effect from January 1 while the other changes, which are not the first price hikes this year for the companies, are set to kick in over the coming fortnight.

The Power NI increase will see the yearly electricity bill of a typical household rise by around £130 per year.

The company attributed the 21.4% tariff rise to soaring global wholesale energy costs and a lack of summer wind.

Consumer Council’s Raymond Gormley said: “This is only Power NI’s second increase in two years but the news will adversely impact those customers already experiencing financial pressures on their household budget, especially as the increase comes at the beginning of the new year.”

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He encouraged standard tariff customers to think about switching payment option or changing energy supplier.

Power NI said the tariff change, which has been approved by the Utility Regulator, was a result of price rises in the global wholesale gas markets.

A lack of wind during the summer has also been cited as a contributory factor, with lower rates of renewable electricity generation leading to a greater reliance on fossil fuel-fired power stations.

As a regulated supplier for domestic customers, Power NI, which is the region’s largest supplier, has to engage with the regulator to secure approval for price rises.

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William Steele, director of customer solutions at Power NI, said there was no option but to pass the costs on to customers: “We work very hard to keep our prices as low as possible, but regrettably there has been a rapid and sustained increase in wholesale gas prices over recent months.

“Like other suppliers, we have no choice but to pay these increased costs, which feed into the cost of wholesale electricity and have a knock-on effect on our tariffs.

“In these challenging times and with such a volatile market, we held off making this change for as long as possible, with this price change not coming into effect until January 2022.

“As soon as we see an opportunity to reduce prices, we will do so without delay.

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“For any customers who are worried about paying a bill, please get in contact and we can help you.

“We value all our customers, and we remain committed to helping those who are being impacted by the cumulative rise in cost of living.

“As well as working directly with our customers, we will continue to work closely with our charity partners, assisting them in helping those who are struggling and providing free energy advice.”

Commenting on the announcement, John French, chief executive of the Utility Regulator, said: “Power NI provided a submission to the Utility Regulator in October to increase their regulated electricity tariff.

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“Following a thorough analysis of all their costs, and in consultation with the Department for the Economy and the Consumer Council for Northern Ireland, we have accepted their submission to increase their tariff by 21.4%.

“This will unfortunately result in an increase to their standard domestic tariff of £131 per year.”

Mr French said: “The drivers behind this increase are that we have had one of the least windy summers since 1961, meaning generation from cheaper wind power has been very low.

“This low output from wind has meant that there has been an increased use of conventional gas, coal, and oil fired power stations.”

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Mr French said that it was “unclear” how long the higher global prices will last due to significant increases in the cost of gas, coal, and oil on global markets.

Mr French added: “But increasingly market analysts are predicting that we will be experiencing higher wholesale prices for the next 18 to 36 months.

“However, if wholesale prices begin to reduce, our system of regulation in Northern Ireland allows us to act to make sure that reductions are fully passed onto consumers as quickly as possible.”

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