Measures to cushion the impact of rising energy prices and inflation




The government is adopting additional measures to help low- and middle-income people cope with rising energy prices and persistent inflation. Purchasing power is expected to fall by 2.7 percent on average. As a result, the government is increasing the one-time energy allowance for people earning around the level of social assistance benefit to €800. Finally, the government is pushing forward with €150 million in expenditure, which was previously planned for 2026, to assist low-income homes with energy-saving measures.

The former government declared at the end of 2021 that it would put aside €3.2 billion to decrease energy taxes. It also proposed a one-time energy allowance of roughly €200 per household to offset the impact of rising energy costs on people with earnings close to the level of social assistance benefit. The payment will also be available to elderly people with low incomes. This one-time payment has been increased to €800 per qualified household. The government and municipalities will make every effort to get this money to the individuals who need it as soon as possible.

This solution will reduce energy expenses for homes with an average use of approximately €140 over the course of the year. The administration also proposed lowering the excise duty on gasoline and diesel by 21% from April 1, 2022, through the end of the year. This reduces the price of gasoline by 17.3 cents per litre and diesel by 11.1 cents per litre.

The previous administration decided to set aside €150 million at the end of last year to assist homeowners in making their homes more sustainable. An additional €150 million is now available to implement additional energy-saving initiatives. The temporary package of actions will have an impact on the budget. This new package will cost €2.8 billion in total. The government believes it is critical that this expenditure be fully covered to avoid passing the bill on to future generations. The package will be funded in part by increased gas income. It will also make use of any remaining funds in the Brexit Adjustment Reserve.