Beat the Price Increases and Save Money on Electricity in 2026
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The Public Service Obligation (PSO) levy for the period of December 1st, 2025, to September 30th, 2026, has been adjusted by the Commission for Regulation of Utilities (CRU). The levy for domestic customers is now set at €1.46 per month (excluding VAT), which amounts to €17.52 per year. Including VAT at the 9% rate, the yearly cost is €19.10. This new rate represents a 55% reduction from the 2024/25 period's charge of €3.23 per month.
Following a revised decision by the CRU, the PSO levy is significantly lower for the remainder of the 2025/2026 period.
Domestic customers will see their monthly charge reduced to €1.46 (excluding VAT) from the previous €3.23.
This change took effect on December 1st, 2025, and translates to an annual cost of €17.52 before VAT, or approximately €19.10 with the 9% VAT included.
This 55% reduction in the levy helps to partially offset rising network distribution costs on household energy bills.
Similar to the domestic rate, the PSO levy for businesses has decreased.
The amount a business pays depends on its Maximum Import Capacity (MIC), which is the maximum amount of electricity a business can draw from the network.
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The Public Service Obligation (PSO) Levy is a tariff imposed on all electricity customers. Its goal is to help pay towards Ireland's renewable energy objectives and is included as an extra tax along with electricity VAT.
The PSO levy is important because it helps the investment in renewable energy and allows for renewable energy producers to receive a guaranteed minimum price.
This is vital since renewable energy is a volatile business venture, and having a guaranteed price allows for Ireland’s renewable energy market to remain stable.
The PSO levy is charged to all electricity customers. It is applied directly to your electricity bill and is paid over the course of the year.
The government sets the level of the PSO levy each year, either increasing or decreasing it accordingly.
The biggest factor that determines how much energy customers are charged is the wholesale price of electricity.
In simple terms, the higher the price of electricity, less money is required to subsidise the generation of renewable energy.
If prices fall, the inverse effect occurs and the PSO levy increases to offset the lost revenue in the generation of renewable energy.
The PSO levy was first introduced in 2010 and in the table below you can see how it has fluctuated in amount in the following years, reaching over €100 in 2017.
PSO Levy Ireland
Euros per year
Source: CRU
Last Updated: February 2026
In Budget 2026, the government shifted away from universal electricity credits to focus on long-term tax measures and targeted supports:
Unlike previous years, there are no universal €250 electricity credits for the 2025/2026 winter season, as the government has pivoted toward permanent VAT reductions instead of one-off payments.
Even with the PSO levy reduction, you can still take action to decrease your own energy bills through energy efficient measures or by switching provider.
Since many suppliers offer discounted rates to new customers, switching can often save households over €400 per year. You can also look into getting a smart meter to take advantage of cheaper electricity with a time-of-use or dynamic tariff.
As of 2026, the PSO levy is not in a refund state. While it was zero or "negative" in 2022/23, it is currently a charge of €1.46 (ex. VAT) per month for domestic customers.
No, the PSO Levy is only applied to electricity bills. Gas customers pay a Carbon Tax, which increased to €71 per tonne in Budget 2026.
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