31-07-2025
- Business
- Irish Independent
No energy credits in upcoming Budget 2026 but VAT and fuel allowance measures possible
Energy Minister Darragh O'Brien also confirmed he wanted to retain the lower VAT rate on gas and electricity that was introduced as a cost of living support three years ago.
His remarks came as latest figures showed a record 301,000 households in arrears on their energy bills.
Mr O'Brien said the numbers were a concern and he urged anyone in arrears to talk to their gas or electricity provider and avail of the arrangements for people unable to pay, stressing that only a 'tiny' number of domestic customers were disconnected.
The Minister said he had chaired the second meeting of the Energy Affordability Task Force on Thursday to look at the wider issue and the interventions needed.
'I will be bringing an interim report to Government in advance of the Budget and we will assess that as to what measures can be taken,' he said.
'I think the vat reduction from 13.5pc to 9pc is a very important one, one that I would like to see extended into next year. That decision will be taken at Budget time.'
Mr O'Brien said the universal energy credits had totalled €3.5bn which ate into funding available for other measures.
'That level of one-off payments is very significant and the more you put into that, the less that you can put into medium and long-term sustainable measures to change our energy system and to ensure that we have secure and affordable energy and green and clean energy too.
'There won't be any energy credits in the budget but we are looking at other measures targeted at those who need them most.'
He said he would discuss the level of fuel allowance with Minister for Social Protection, Dara Calleary.
'Vulnerable families, low income families – that's the focus of what we'll do in the budget,' he said.
He would also look at growing the Warmer Homes Scheme which provides free retrofits and energy upgrades for low-income households, as well as making grant-assisted works more affordable and accessible for more people.
'We have seen a levelling off of energy prices but we're still the eighth most expensive in Europe. Prices are too expensive within Ireland.'
