The Northern Ireland Authority for Energy Regulation has welcomed a new licence deal between Phoenix Natural Gas and the Regulator. Speaking on behalf of the Northern Ireland Authority for Energy Regulation, Dermot MacCann, the Deputy Chief Executive of Ofreg, said ’ The Authority sees the agreement with Phoenix as good for both gas customers and Phoenix. It provides greater stability on that part of the customer’s final bill, which is regulated by the Authority. For domestic customers this is over 50% of the final bill. The remainder of the consumer’s bill reflects the cost of gas purchased by Phoenix. This to a large extent reflects movements in the market price of gas, which like oil and coal can go both up and down. On the half of a customer’s gas bill which is regulated the Authority has agreed a long-term price for domestic customers around 5p (or 12%) below what Phoenix are charging today and some 20p less they were entitled to charge under their current licence. The Authority envisages prices on the regulated part of the bill rising by no more than inflation and indeed, with the potential for efficiency improvements and other downward pressures on prices built into the agreement with Phoenix, it sees potential for increases of less than inflation if not decreases. On that part of the bill, which reflects gas purchase costs by Phoenix, the Authority would envisage gas prices in Belfast remaining competitive with other fuels. In the short-term Phoenix’s recent deal with its gas supplier Centrica and in the longer term a fully competitive gas supply market should ensure that this happens. Furthermore the Authority see the reductions agreed with Phoenix on the regulated part of the bill helping to moderate any future price rises resulting from the current high market price of gas.’
Notes for Editors
OFREG (the Office for the Regulation of Electricity and Gas) supports the Northern Ireland Authority for Energy Regulation (NIAER) the regulator of the Electricity and Gas industries in Northern Ireland. NIAER’s powers are derived from the Electricity (Northern Ireland) Order 1992, the Gas (Northern Ireland) Order 1996 both as amended by the Energy (Northern Ireland) Order 2003.
For further information contact Terry McErlane at Weber Shandwick Telephone 028 90761007 or 07770886911