Richard Bruton (Dublin North Central, Fine Gael)

I propose to take Questions Nos. 20 and 23 together.

As the Minister for Jobs, Enterprise and Innovation, I am keen to ensure that the cost base for business is competitive to enable enterprises to grow and to support job creation. While there has been a welcome improvement in cost competitiveness in the past two years, including in the energy field, any reversal of these trends would be most unwelcome. However, the Government has no role in setting electricity prices and only certain segments of the market are regulated by the Commission for Energy Regulation, CER. I recently met the CER and asked that there be a clear distinction made between the elements of energy pricing within our control and those that lie outside it.

Last week, Bord Gáis Energy announced that it is to increase its residential electricity prices by 12% from 1 August due to the significant increase in the cost of commodities on the wholesale markets. As this increase relates to residential customers only, it does not require the CER's approval.

The Sustainable Energy Authority of Ireland, SEAI, published a report earlier this week on electricity and gas prices in Ireland based on EUROSTAT data. This report includes an analysis of the most recent trends in energy costs for businesses. While the report is detailed, the main findings are that, following reductions in electricity costs for businesses in 2009 and the first half of 2010, there was upward pressure on prices during the second half of 2010, with prices rising slightly faster than in the EU in general. Notwithstanding the increases, Ireland's electricity costs remained below the EU average for medium to large business consumers, but above the average for small business consumers. Gas price increases for businesses also increased in the second half of 2010, but remained below the EU average for all business customer levels.

I do not have data on the specific impact of increases in gas and electricity prices on business. The impact will vary depending on the size of the company and the nature of its activities. However, indicative data published in the National Competitiveness Council's "Costs of Doing Business in Ireland" report would suggest that, in the manufacturing and services sectors, utility costs, including water and waste as well as energy charges, account for less than 5% of companies' total costs.

It is important to point out that business and domestic customers can avail of competitive offerings from a number of electricity and gas suppliers and should seek the best value on offer in the marketplace to suit their circumstances. Competition helps to put downward pressure on energy prices, but businesses can also focus on mitigating energy costs through energy efficiency measures. The SEAI can provide advice and, subject to available resources, financial assistance in this respect. In addition, extensive tax relief is available to businesses under the accelerated capital allowances scheme for energy efficient technologies. Enterprise Ireland also works with its client companies on improving productivity and efficiency and offers a range of programmes in this regard. The home page of my Department's website includes links to the main supports available to businesses for job creation and productivity, including supports available from the SEAI and Enterprise Ireland.

The Government will do all it can to reduce the cost of doing business. We have been working on several elements, including rents, wages, commercial rates and other charges. The European Central Bank, ECB, announced an increase in interest rates on 7 July. An independent organisation, the ECB has sole responsibility for monetary policy decisions in the euro area and the Government has no control over setting interest rates. However, we have taken many steps to improve access for SMEs to credit, including restructuring the banks, a partial loan guarantee that is in development in my Department and other measures.

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