Following today’s announcement by Airtricity Gas Supply NI of an 8.7% tariff increase for Greater Belfast gas consumers, the Utility Regulator explained the key reasons for the increase.
Two main factors contributed to the increase:
1. The increase in gas distribution charges paid by all gas suppliers, which represents about half of the increase. This reflects the impact of the Competition Commission’s determination on the Phoenix Natural Gas price control and the impact of inflation.
2. A tariff adjustment to recover the company’s gas supply costs over time.
Commenting on the announcement, Utility Regulator Chief Executive, Shane Lynch said:
“Although this is the first gas price increase for two years, we recognise the impact that it will have on consumers at a time when household and business budgets are stretched. We never approve proposals for tariff increases without extensive scrutiny. Our scrutiny during this tariff review has reduced the extent of the increase sought by Airtricity. If gas costs decrease, we will act as soon as possible to ensure that this reduction is reflected in consumer bills.
“A significant part of the increase was the Competition Commission’s determination on the Phoenix Natural Gas Ltd price control. The Utility Regulator’s determination on the Phoenix Natural Gas Ltd price control would have resulted in a smaller increase for natural gas consumers.
Mr Lynch added.
“The tariff increase will still leave the standard domestic average tariff for Greater Belfast gas consumers lower than their equivalents in Great Britain or the Republic of Ireland. It is also important to note that consumers who choose natural gas enjoy a significant running cost savings over those who use oil to heat their homes.”
ENDS
For further information, please contact Greg Irwin on 028 90 316348 or 07794 695911.
Notes to editors
• The Utility Regulator is the independent non-ministerial government department responsible for regulating the electricity and gas industries and water and sewerage services in Northern Ireland.
• For further information on the comparison with GB and ROI, please see question 3 in the Q&A document.
• A Q and A document and a briefing paper are available.