A VAT cut on household fuel, a cut to the Public Service Obligation (PSO) levy on energy bills and another 'lump sum' payment for those on Fuel Allowance could be on the way.

They were among the measures discussed by senior members of Government on Monday night to help combat spiraling prices sparked by the invasion of Ukraine.

Cabinet will meet on Wednesday to discuss and sign-off on the plans.

Under the proposals, 370,000 people in receipt of the Fuel Allowance could soon be given a 'lump sum' payment of €99.

VAT on energy bills could also be reduced temporarily from 13.5% to 9%.

Such a reduction would be worth around €50 on gas and €60 on electricity.

A proposed cut to the PSO levy on energy bills could also knock €50 off household bills per annum.

Chief economist with Davy stockbrokers, Conall Mac Coille, says the plans are right at the edge of what will benefit people.

"The average bill for a household for gas and electricity [is] potentially well over €2,000 at this point.

"So it's helpful at the fringes and will help people's disposable incomes.

"It'll be interesting the detail on the Fuel Allowance because the cut in the VAT rate and the levy sound like they're pretty broad brush, and not targeted at the people who'll be really squeezed on low incomes.

"In the context of the sort of 60% to 70% increase we've had over the past 18 months, it's helpful at the margin.

"But again, you are going to see a big squeeze on household bills in April and May as some of the recent gas and price increases are introduced by some of the companies.

"And again the increases that are still to come are of the order of 20/30%".

Additional reporting: Adrian Harmon