Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Communications, Energy and Natural Resources the basis on which the Energy Regulator passed on a further 1% over the requested 7.5% increase by Bord Gáis; the persons the Energy Regulator consulted with in their public consultation; his views on the matter in view of the already lowered living standards of persons in recent years, in particular the rise in fuel poverty; and if he will make a statement on the matter. [41080/12]

Pat Rabbitte (Dublin South West, Labour)
Link to this: Individually | In context | Oireachtas source

I have no statutory function in the setting of gas prices, whether in the regulated or non-regulated parts of the market. Responsibility for the regulation of the gas market is a matter for the Commission for Energy Regulation (CER) which is an independent statutory body. With effect from 1^st October 2011, gas residential consumers are the only segment of the gas market where prices are regulated.

Over the summer period of each year the CER conducts an annual review of the Bord Gáis Energy (BGE) tariff. The CER’s review for the gas year commencing 1^st October 2012 involved a detailed assessment by the CER of BGE’s own proposals on gas prices published on the 18^th July, followed by a consultation process inviting comments from interested parties - including the public - and culminated in the decision published by the CER on 4^th September.

In the CER consultation document published on 27^th July, the CER noted that the proposed allowed increase in revenue would go up or down depending on the movement in commodity prices, exchange rates and the ongoing 5 year review of network tariffs. The annual consultation process also allows BGE to update the regulator in regard to any changes in the intervening period. All documents are available on the CER’s website at

The increase initially sought by BGE in its submission equated to a 7.5% increase in tariffs. However, in the period following the publication of the CER’s consultation paper on the BGE tariff, gas commodity costs rose because the value of the Euro against Sterling further decreased. This is a key driver of prices given that Ireland purchases over 95% of its gas from Great Britain. To take account primarily of these external cost drivers, I understand that BGE subsequently sought CER approval for an increase in retail tariffs for the coming year of the order of 9.2%. The CER considered, however, that an increase of no higher than 8.5% was justified.

The Government is most concerned at the impact of higher gas and electricity prices on residential and commercial consumers. As indicated above, it is regrettably the case that in the main Ireland is at the mercy of international fossil fuel prices which dictate the retail price of gas and electricity. My focus is on those very limited elements of energy costs over which policy can exercise some control.

Accordingly, it is estimated that some €226 million overall has been spent on the Better Energy programme on energy efficiency measures since commencement. This includes funding of €142.25 million for some 330,000 measures in 130,000 households under the Better Energy: Warmer Homes scheme.

Better Energy: Warmer Homes delivers a range of energy efficiency measures to household that are vulnerable to energy poverty. The scheme is managed by the Sustainable Energy Authority of Ireland (SEAI) and delivered through a range of Community Based Organisations (CBOs), augmented by a panel of private contractors in order to ensure national coverage. Since the commencement of the Programme in 2000, energy efficiency upgrades have been delivered to 85,000 homes amounting to €84.5m in Exchequer funding. In addition, the Government is actively supporting the rollout of renewable resources of electricity which has grown from an estimated 9.3% of electricity consumed in 2007 to an estimated 17.6% in 2011.

There are a number of ways for consumers to take actions on electricity and gas prices, and measures in place to assist them. They can shop around to get the best possible price and service deal from suppliers bearing in mind that other suppliers can and do offer competitive prices and products. Consumers can also take steps to improve the efficiency of their electricity and gas usage which delivers demonstrable savings.

The CER is also working with energy suppliers to ensure that vulnerable customers are protected through, inter alia, the installation of Pay As You Go meters. The long term policy responses for Ireland to combat vulnerability to high and volatile gas prices continue to be increasing the use of renewables, achieving better energy efficiencies and reducing the reliance on gas in the fuel mix. Implementation of the measures set out in the Government’s Affordable Energy Strategy is also key to protecting the interests of vulnerable customers.