Flogas has joined the ranks of energy companies announcing price reductions. Beginning March 25th, the supplier will lower the variable rate for natural gas by 25% and decrease the variable rate for electricity by 15%. On average, this translates to savings of €274 on electric bills and €429 on gas bills. However, smart meter tariffs will remain unchanged for the time being. Flogas is also reducing its standing charge for gas by 10%. This marks the second time in just over four months that Flogas has implemented price reductions, following similar moves by Energia, Bord Gáis Energy, and Electric Ireland.
In November, Flogas implemented price cuts of 30% for both gas and electricity. Daragh Cassidy, from the comparison site bonkers.ie, noted that despite these substantial reductions, which exceed those announced by competitors in recent months, Flogas’s prior high rates meant that its new prices are now comparable to those of its competitors. “Today’s reductions have aligned its standard rates with the rest of the market for the first time in about two years,” stated Mr. Cassidy. “However, Flogas’s energy prices still remain significantly higher than they were approximately three or four years ago, before the impacts of Covid and the war in Ukraine caused upheaval in energy prices.”
“Looking ahead, the encouraging news is that wholesale gas and electricity prices are still on the decline. Although they remain relatively high, if this trend persists and there are no significant economic shocks, it’s highly probable that we’ll witness a third price reduction from Flogas of a similar magnitude in the latter part of the year.”
According to the latest figures from the Central Statistics Office (CSO), wholesale electricity prices dropped by 68% last year, reflecting a continuous decline from their peak in 2022. In December alone, electricity prices plummeted by 27.6%, marking a 67.8% decrease compared to the previous year. The CSO’s energy products index has declined by 22.7% since November 2023 and by 60.3% compared to December 2022. Energy prices, which surged following the onset of the Covid pandemic, experienced a sharp increase after Russia’s invasion of Ukraine in February 2022, reaching their highest point in August of the same year.
Between August 2021 and August 2022, wholesale electricity prices surged by 194.9%, reaching a peak of nearly €400 per MWh (Megawatt Hour), compared to an average of approximately €38 per MWh throughout 2020. Despite significant declines in wholesale prices over the past year, consumer groups have voiced concerns that energy providers are not promptly passing on these savings to consumers. According to the latest consumer price index from the CSO, electricity prices for consumers only decreased by 15.2% last year.
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