Irish household energy costs could be around 20% lower in 2035 if the country follows a balanced energy transition pathway that combines renewable deployment with greater investment in electrification, networks and flexibility, according to an analysis by Aurora Energy Research.

The analysis compares two potential outcomes for Ireland’s energy system in 2035 and argues that focusing primarily on renewable deployment and decarbonisation could result in higher costs for consumers. By contrast, Aurora says a more integrated approach could deliver both lower emissions and lower overall energy costs.

The findings come as Ireland faces high household electricity prices. According to Aurora, the country recorded the second-highest household electricity prices in the European Union in 2025, with average household electricity prices reaching €0.364/kWh.

Aurora’s analysis also highlights the composition of household electricity bills. Only around 38% of a typical household electricity bill is directly related to electricity generation, while network, balancing and other system costs account for the majority.

This means that increasing renewable generation alone would not necessarily deliver the lowest-cost energy transition, according to the research. Aurora argues that policymakers will also need to coordinate investment in electricity networks, system flexibility and consumer electrification.

Electrification and system integration key to reducing costs

Greater consumer electrification is one of the elements Aurora identifies as important to achieving a lower-cost transition. The research suggests that combining electrification with investment in networks and flexibility can help Ireland capture the benefits of increasing renewable generation while managing wider system costs.

The analysis comes against a backdrop of renewed pressure on energy affordability. Recent geopolitical tensions have pushed gas prices higher, adding further pressure to household energy bills.

At the same time, the Irish Government has established the National Energy Affordability Taskforce (NEAT) and is developing an Energy Affordability Action Plan, increasing the focus on how the country's energy transition can be delivered at the lowest possible cost to consumers.

Aurora therefore argues that affordability and decarbonisation should not be treated as competing objectives. Instead, the research points to system integration as a key factor in achieving both.

“The energy transition is often framed as a choice between decarbonisation and affordability, but that is the wrong question,” said Steph Unsworth, Research Lead Expert at Aurora Energy Research. “A successful transition must deliver both.”

Unsworth added that achieving the right balance between renewable generation, infrastructure and electrification could allow Irish consumers to benefit from lower emissions and lower energy costs.

Aurora's analysis ultimately suggests that the cost of Ireland's energy transition will depend not only on how much renewable generation is deployed, but also on how effectively new generation is integrated into the wider energy system and connected with consumer demand.