30-Second Overview
Ireland's Electricity PSO Levy has been reduced by 66% for 2026/2027, with the new rates taking effect on 1 October 2026 and remaining in place until 30 September 2027. The reduction means lower annual electricity charges for businesses of all sizes:
- Small businesses: Save €44.64 per year.
- Medium businesses (100 kVA MIC): Save €552 per year.
- Larger businesses (200 kVA MIC): Save €1,104 per year.
- Large energy users (500 kVA MIC): Save €2,760 per year.
Although the reduction is welcome, the PSO Levy represents only a small proportion of most business electricity bills. Wholesale electricity prices, network charges and contracted supply rates have a much greater impact on overall electricity costs.
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What is the Electricity PSO Levy?
The Public Service Obligation (PSO) levy is a regulated charge that appears on electricity bills in Ireland. The levy is collected by electricity suppliers on behalf of the Government and helps fund renewable electricity schemes, including wind, solar and other low-carbon generation projects.
The amount of PSO levy is reviewed every year by the Commission for Regulation of Utilities (CRU) and applies for the period from 1 October to 30 September.
For businesses, the levy is charged differently depending on the size of the electricity connection:
- Small commercial customers (MIC below 30 kVA) pay a fixed monthly charge.
- Medium and large businesses (MIC of 30 kVA or above) pay according to their Maximum Import Capacity (MIC).
Electricity PSO Levy Rates 2026/2027
The Commission for Regulation of Utilities (CRU) has reduced the total Electricity PSO Levy from €125.38 million in 2025/2026 to €41.48 million for 2026/2027, a reduction of €83.90 million (66%). The revised rates took effect on 1 October 2026.
| Customer Category | PSO Levy 2025/2026 | PSO Levy 2026/2027 | Change (%) |
|---|---|---|---|
| Domestic | €1.46 / month | €0.51 / month | - 65% |
| Small Commercial (MIC < 30 kVA) |
€5.65 / month | €1.93 / month | - 66% |
| Medium/Large Commercial (MIC ≥ 30 kVA) |
€0.70 / kVA / month | €0.24 / kVA / month | - 66% |
All figures exclude VAT. The revised PSO Levy rates took effect on 1 October 2026 and apply until 30 September 2027.
How Much Will Businesses Save on the Electricity PSO Levy?
The 66% reduction in the Electricity PSO Levy delivers savings for businesses of all sizes. The table below compares annual PSO charges for 2025/2026 and 2026/2027, based on different Maximum Import Capacity (MIC) levels.
| Customer Category | Annual PSO 2025/2026 | Annual PSO 2026/2027 | Annual Saving |
|---|---|---|---|
| Domestic | €17.52 | €6.12 | €11.40 |
| Small Business (MIC < 30 kVA) |
€67.80 | €23.16 | €44.64 |
| Medium Business (MIC = 100 kVA) |
€840 | €288 | €552 |
| Larger Business (MIC = 200 kVA) |
€1,680 | €576 | €1,104 |
| Large Energy User (MIC = 500 kVA) |
€4,200 | €1,440 | €2,760 |
💡 The exact savings depend on your business’s Maximum Import Capacity. To view the energy regulator’s decision paper, visit: Public Service Obligation Levy 2026/27
Why Has the Electricity PSO Levy Been Reduced for 2026/2027?
The Electricity PSO Levy has fallen by 66% for 2026/2027, primarily because of higher forecast wholesale electricity prices and increased repayments from renewable electricity generators. The CRU's decision identifies three key factors behind the reduction.
1. Higher Forecast Wholesale Electricity Prices
The CRU expects wholesale electricity prices during 2026/2027 to be 16% higher than those used in the previous year's calculation. Higher wholesale prices allow renewable generators to earn more revenue directly from the electricity market, reducing the financial support required from the PSO Levy.
2. Increased Repayments from Renewable Generators
Ireland's Renewable Electricity Support Scheme (RESS) requires participating generators to repay money into the PSO fund when wholesale electricity prices exceed their guaranteed strike prices.
For 2026/2027, these repayments are forecast to total €43.37 million, reducing the amount electricity customers need to contribute.
3. More Renewable Electricity Generation
Despite the lower levy, the PSO fund will support approximately 5,003 MW of renewable generation during 2026/2027, compared with 4,607 MW in the previous year. This demonstrates that the reduction in PSO charges is not the result of reduced renewable electricity support. Instead, it reflects higher expected wholesale revenues and the way newer renewable support schemes operate.
Will Electricity Bills Fall for Businesses?
Not necessarily. Although the Electricity PSO Levy has fallen by 66%, it represents only one component of a commercial electricity bill. Whether your overall electricity costs increase or decrease depends on several factors:
- Wholesale electricity prices: Changes in wholesale markets influence electricity supply rates.
- Electricity network charges: DG5 and DG6 charges increased from 1 October 2026, while DG7 charges decreased.
- Your electricity contract: Fixed-price and wholesale tracker contracts respond differently to changes in electricity markets.
- Electricity consumption: The amount of electricity your business uses directly affects its total costs.
The reduction in the PSO Levy will help offset higher network charges in 2026/2027 for businesses with DG5 and DG6 meters. However, it does not guarantee a reduction in overall electricity bills.
💡 Pro Tip: Securing a competitive electricity contract and reviewing your Maximum Import Capacity (MIC) can deliver greater savings than the PSO Levy reduction alone.
How to Reduce Your Business Electricity Costs
The reduction in the PSO Levy is welcome but businesses can achieve greater savings by reviewing their electricity contracts and securing competitive supply rates.
Utilityfair provides a free comparison of business electricity prices from all Irish suppliers. Our Energy Advisors review your electricity usage, rates and contract options to identify potential savings. We will:
- Compare electricity prices and contract options across all suppliers.
- Review your meter category, consumption and Maximum Import Capacity (MIC).
- Manage the switching process, saving you time and hassle.
- Monitor contract renewal dates to help avoid expensive out-of-contract rates.
👉 Ready to Start Saving?
Get a free comparison of business electricity prices from all Irish suppliers. Complete our enquiry form using the buttons below or call 01 547 0999 to speak with a Utilityfair Energy Advisor.
Frequently Asked Questions (FAQs)
The Public Service Obligation (PSO) Levy is a regulated charge on electricity bills that helps fund renewable electricity generation in Ireland. It supports schemes for wind, solar and other renewable energy projects. The levy is approved annually by the Commission for Regulation of Utilities (CRU) and collected through electricity suppliers.
From 1 October 2026, the Electricity PSO Levy is €0.51 per month for domestic customers and €1.93 per month for small businesses with a Maximum Import Capacity (MIC) below 30 kVA. Businesses with an MIC of 30 kVA or above pay €0.24 per kVA per month. All rates exclude VAT.
The reduction is primarily due to higher forecast wholesale electricity prices and increased repayments from renewable electricity generators. Higher wholesale prices reduce the financial support required by renewable generators, while repayments under the Renewable Electricity Support Scheme (RESS) help lower the amount collected from electricity customers.
The calculation depends on your Maximum Import Capacity (MIC). For the 2026/2027 PSO year businesses with an MIC below 30 kVA pay a fixed monthly charge of €1.93. Businesses with an MIC of 30 kVA or above pay €0.24 per kVA per month.
For example, a business with an MIC of 100 kVA pays €24 per month, or €288 annually, excluding VAT.
For the 2026/2027 PSO year small businesses with an MIC below 30 kVA will save €44.64 annually. Businesses with an MIC of 100 kVA will save €552 per year, while those with an MIC of 200 kVA will save €1,104. A large energy user with an MIC of 500 kVA will save €2,760 annually. All savings exclude VAT.
Not necessarily. Although the PSO Levy has decreased by 66%, it represents only one component of a business electricity bill. Wholesale electricity prices, network charges, contracted supply rates and electricity consumption have a greater impact on overall costs. The reduction will help offset higher network charges for businesses with DG5 and DG6 meters.
The Electricity PSO Levy is reviewed annually by the Commission for Regulation of Utilities (CRU) with changes taking effect on 1 October every year. The rates apply from 1 October until 30 September each year.
