The Utility Regulator today welcomed the news that NIE Energy and Phoenix Supply Ltd are to decrease their tariffs by 10.8% and 22.1% respectively, as well as firmus energy’s undertaking to extend its price freeze. Chief Executive, Iain Osborne said: “Today’s announcement delivers on our commitment to consumers: that should underlying costs come down, they will see the benefits in lower energy bills as soon as possible. Although some costs are locked in by forward contracts, we have used the remaining flexibility to pass through falls in the wholesale costs of gas and coal. “This has been an exceptional year for energy prices and I am acutely aware of the difficulties faced by many households. The biggest single factor has been the unprecedented increase in wholesale gas costs. These were high in the Summer (when they are usually low), and fell through the Autumn (when they usually rise). “We have applied the usual rigorous scrutiny to submissions made by the energy companies. This rigour was recently recognised by Douglas McIldoon in his independent review of electricity tariff setting. “We will continue to monitor the situation very closely on behalf of consumers”.
Notes to Editors
1. The Northern Ireland Authority for Utility Regulation (the Utility Regulator) is the non-Ministerial Government Department responsible for regulating the electricity and gas industries and water and sewerage services in Northern Ireland.
2. Between September 2007 and September 2008, wholesale gas costs doubled. Generation costs make up around 60% of the electricity bills for domestic customers and 80% for business customers in Northern Ireland. Two-thirds of Northern Ireland’s electricity is generated using gas. The use of oil for generating electricity in Northern Ireland is minimal. NIE Energy remains close to fully hedged, but lower gas costs have reduced an element of the bill, called the Public Service Obligation, which is why a reduction is possible now. Phoenix Supply Ltd are also substantially hedged, which is why this reduction does not reflect the full fall in gas costs.
3. Information explaining the rationale behind the price decreases can be viewed or downloaded using the following links: Electricity Price Reduction - Gas Price Reduction
4. Iain Osborne, Chief Executive of the Utility Regulator is available for interview on Monday 15th December between 7 a.m. and 9.30 a.m