The government has announced that the Temporary Business Energy Support Scheme (TBESS) will be extended until May 31, 2023 and a number of enhancements to it will be introduced.
The qualification threshold for the TBESS will be reduced from a 50% increase in gas and electricity costs to a 30% increase, which will apply to costs incurred from September 1 last year.
In addition, from March 1, the level of relief will rise from 40% to 50% of eligible costs, subject to a monthly limit which is also set to rise to €15,000 per month per trade or profession.
An overall cap of €45,000 per month will also apply where the business operates across more than one location.
The changes are part of a €1.2 billion cost of living support package which was announced by government today (Tuesday, February 21), in an attempt to alleviate the ongoing challenges that families, businesses and vulnerable people are facing following the Russian invasion of Ukraine.
Speaking about the measures announced, Tánaiste Micheál Martin said:
“Targeted welfare and education supports will further shield families from the impact of inflation, while businesses will benefit from an expanded TBESS scheme.
“This comes on top of a substantial package of supports in Budget 2023, and while energy inflation shows signs of moderating, it is important people and workers don’t face a cliff edge on fuel and energy costs in the coming months ahead of another budget in October,” he added.
It was also announced that the temporary reduction on VAT from 13.5% to 9% on gas and electricity, which was due to expire on February 28, will be extended until October 31.
It’s estimated that this measure will come at a cost of €115 million.
The Irish Farmers’ Association (IFA) Poultry Committee previously called for this extension with poultry chair Nigel Sweetnam warning that if it was reversed, poultry farmers could face significant cost increases with a knock-on impact for consumers.
A grant is also set to be introduced for businesses using Liquified Petroleum Gas (LPG) or Kerosene, although details have yet to be announced on this.
Petrol and diesel excises
In addition to the changes to the TBESS, it was also announced that a phased restoration of the excise rates on green diesel, petrol and diesel will take place in three stages over the coming eight months.
By June 6, rates will be restored to 1c/L on green diesel, 6c/L on petrol and 5c/L on diesel.
These rates will then increase by a further 1c/L, 6c/L and 5c/L on green diesel, petrol and regular diesel respectively, by September 1.
By October 31, a third jump of another 3c/L of agri-diesel, 8c/L for petrol and 6c/L for regular diesel will have taken place, and rates will be fully restored.
Overall, the goverment has estimated that the extension, combined with the phased re-introduction of these rates will cost approximately €383 million.
Other measures
A host of other measures, worth €470 million, which are aimed at supporting social protection recipients were also announced in the package.
A once off €200 lump sum will be made in April to those on the working family payment, lone parents, low-income families, carers, those on disability payments and pensioners among others.
Childcare supports announced include a €200 lump sum child benefit payment to be made in April and a second worth €100 to be paid in June, reduced charges to school transport and the extension of the Hot School Meals programme to all DEIS primary schools from September.
A full list of the measures announced, which are subject to state aid approval by the European Commission, can be found on the government’s website.