Budget 2027 · Energy and fuel
Budget 2027 energy: Fuel Allowance, carbon tax, heating oil and fuel excise
Energy is expected to be central to Budget 2027. Here are the current rates and what has been reported about heating oil, fuel excise and energy credits.
Updated 4 October 2026. Budget day is Tuesday 6 October 2026.
Before, now and Budget 2027
Energy and fuel: what's going up, what's going down
In Budget 2026, of the 2 rates shown: 1 went up, 0 went down and 1 stayed the same.
| What | Before Budget 2026 | Now | Budget 2027 |
|---|---|---|---|
| Carbon taxPer tonne of CO₂Petrol and diesel from 8 October 2025; other fuels from 1 May 2026Source: Citizens Information | €63.50 a tonne | €71 a tonne+€7.50 | Due 6 OctReported: RTÉ reported on 25 September that a lower carbon tax rate on home heating oil is being considered. Not decided. RTÉ News |
| VAT on electricity and gasHousehold bills9% rate extended to 31 December 2030Source: Citizens Information | 9% | 9%No change | Due 6 Oct |
Predictions
What's expected in Budget 2027
From named reports, with exact quotes. These are not decisions until Budget day.
1 widely expected1 likely1 unlikely
- Widely expected
Fuel excise cuts extended to early spring
The cuts on petrol and diesel were due to start unwinding in November. Minister Jack Chambers has said they will run on.
The cut to excise on petrol and diesel will now be extended beyond November until early spring, at a cost of €100m a month.
Irish Examiner, Elaine Loughlin · 28 Sept
Will it happen? - Likely
Lower tax on home heating oil, and the next carbon tax rise paused
A lower rate on kerosene has been described as almost certain. The next scheduled carbon tax increase may be postponed.
A reduced rate of tax on home heating oil has also all but been announced
Irish Examiner, Elaine Loughlin · 28 Septthe next round of increases looks likely to be postponed.
The Irish Times · 16 Sept
Will it happen? - Unlikely
No universal energy credits
The Government has favoured targeted supports such as the Fuel Allowance over cash credits for every household.
So far the Government has resisted the return of energy credits
The Irish Times · 16 Sept
Will it happen?
Questions
Energy and fuel: your questions answered
Budget 2026 did not include a general electricity credit. Government sources told RTÉ that a bonus week of fuel allowance is among the options being weighed for Budget 2027. Nothing is decided until Budget day.
Carbon tax is €71 a tonne. It applied to petrol and diesel from October 2025 and to other fuels from 1 May 2026. RTÉ reported that a lower rate on home heating oil is being considered for Budget 2027.
The cuts introduced in April 2026, 32 cent a litre on diesel and 27 cent on petrol, are due to end in early November. RTÉ reported that the Government is looking at extending them into early spring.
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