Ibec calls for access to subsidies 'to reflect scale' of energy crisis
Business group Ibec has warned the Government will have to provide easier access to subsidies "to reflect the scale of the crisis" as as firms struggle to paysoaring energy bills.
Businesses are braced for more energy hikes next year even after their gas and electricity bills climbed this year by 90% and 60%, respectively, according to a survey conducted by the business group.
"The research also shows that business exposure to high energy costs will continue into 2023 as more and more businesses exit contracts and lose pre-crisis hedging arrangements," said Conor Minogue, a senior executive for infrastructure, energy, and climate policy.
"While wholesale gas prices have fallen from the exceptional heights we saw in August, the market remains volatile and prices still remain well above normal levels," he said.
The Government unveiled the Temporary Business Energy Support Scheme and the Ukraine Enterprise Crisis Scheme in late September, part of its €4bn energy budget package in subsidies for businesses and households.
However, Ibec said that "in its current design" that many firms do not qualify for UECS and that "support levels are also below that seen in other European countries, putting Irish businesses at a competitive disadvantage".
Extending the temporary business support through 2023, redesigning the UECS, and helping firms adapt solar power projects would help firms, Ibec said.
Businesses and economists continue to closely monitor the prices on the European wholesale gas markets, which have soared since the Russian invasion of Ukraine in late February.
The price of gas for delivery in January was trading last week at €117.50 per megawatt hour. That is down from a peak of over €345 reached last August when Russia shut off gas supplies to the EU through the subsea Baltic pipeline, as part of the economic war that is raging between the West and Russia.
Ibec said that the huge cost of energy now makes investing in renewables feasible.
“Throughout this crisis, businesses have not lost sight of the long-term imperative to transition away from fossil fuels. And with costs so high, projects that were once financially unviable may now make sense," the business group said.