Government Energy Package Relies On Short-Term Fuel Cuts While Leaving Households Exposed To Future Shocks

The Government’s response to rising energy prices, which centres on fuel tax cuts and limited targeted supports alongside them, falls far short of what is needed to protect households and reduce Ireland’s exposure to volatile fossil fuel markets, Friends of the Earth has said.

The measures announced today are limited to short-term relief and do little to address the underlying drivers of high energy costs.

Clare O’Connor, Programme Coordinator at Friends of the Earth Ireland, said:

This package primarily relies on cutting fuel taxes - one of the most expensive and least effective ways to respond to an energy crisis. It benefits higher-income households the most, weakens incentives to reduce fossil fuel use, and leaves the most vulnerable still struggling.

While extending the Fuel Allowance season does provide some targeted support, the payment remains far below what many households need to meet rising heating and electricity costs. More than 320,000 customers are already in arrears on their energy bills.

Extending the Fuel Allowance season by four weeks will not address the fundamental inadequacy of the payment for households facing sustained high costs. What’s missing is a serious long-term plan to protect people not only in this crisis, but from future price shocks too.

Friends of the Earth said the Government has missed an opportunity to introduce fairer and more effective measures, including targeted energy supports, action to reduce electricity prices, and measures to reduce dependence on fossil fuels.

The Taoiseach is right that this crisis is a reminder of the volatility of relying on fossil fuels. But that makes it all the more concerning that the Government’s main response is broad fuel tax cuts. Temporary relief has a role, but it cannot be the centre of the response if the aim is to protect households from future fossil fuel shocks.

Friends of the Earth is calling on the Government to urgently:

• Introduce targeted energy supports for households struggling most with high heating and electricity bills - particularly one-parent families, renters and people with disabilities - including emergency hardship support for households already in arrears and automatic access to the lowest tariffs for vulnerable households
• Prioritise area-based retrofitting and renewable heating in communities with high deprivation and the least efficient housing stock
• Publish the overdue Energy Affordability Action Plan without further delay
• Increase Fuel Allowance rates in line with actual energy costs
• Ensure no household is disconnected from energy supply because they cannot afford to pay during the current crisis
• Ensure that costs associated with purchasing and operating clean heating solutions, such as heat pumps, are not more expensive than fossil fuel-based heating. 
• Finalise Ireland’s overdue Social Climate Plan to unlock EU funding to protect vulnerable households from future price shocks

Notes to editor:

• CRU arrears data from December 2025 shows energy arrears at their highest level on record, with 14% of electricity customers and 26% of gas customers in arrears. The average electricity arrears balance is now 10% higher than in December 2024. 
• The National Energy Affordability Taskforce (NEAT) in its Terms of Reference adopted in June 2025, committed to publishing a National Energy Affordability Action Plan in December 2025. 
• Ireland has failed to meet the June 2025 deadline to submit its Social Climate Plan to the European Commission. The Social Climate Plan (covering 2026–2032) is meant to use the EU's Social Climate Fund to help vulnerable households and micro-enterprises manage increased costs for buildings and transport. Ireland can access up to €663 million of this fund.
• Ireland has the lowest share of renewable energy in heating in the EU (7.9%), leaving households particularly exposed to fossil fuel price volatility