Airtricity's Phoenix takeover may lead to cheaper energy for consumers
Householders could soon see energy bills fall after Airtricity became the first firm in Northern Ireland to offer a dual fuel service for domestic electricity and gas.
It follows Phoenix’s decision to sell its gas supply business to the rival power firm, which is one of the UK's largest energy suppliers.
The 130,000 domestic and business customers currently supplied by Phoenix Supply Ltd are unlikely to notice any immediate difference, however, as their existing contracts will simply be switched over to Airtricity.
But the acquisition means that some 230,000 customers will soon benefit from the Northern Ireland’s first ever dual billing service, as a result of electricity and gas being supplied by the same firm.
Kevin Greenhorn, CEO of Airtricity, says the company believes the development represents “an exciting new chapter”.
“This is a significant step forward for both Airtricity and Phoenix Supply as we seek to become the largest supplier of both electricity and natural gas in Northern Ireland,” said Mr Greenhorn.
“This is especially exciting as for the first time consumers in Northern Ireland, including Airtricity and Phoenix customers, will be able to enjoy the benefits of dual fuel products and services.
“Through this deal we will extend our commitment towards serving customers, employing people, and making investments in Northern Ireland to Phoenix Supply customers and staff.”
He added: “We look forward to completing this acquisition as soon as possible.”
Phoenix will continue to focus on building Phoenix Natural Gas, which operates the Greater Belfast gas network and is responsible for making gas available to around half the population of Northern Ireland, the company said.
Airtricity entered Northern Ireland's domestic electricity market in 2010 and it has attracted more than 100,000 domestic and commercial electricity customers since then.
The acquisition makes Airtricity Northern Ireland’s second largest energy supplier after Power NI, which has 700,000 electricity customers.
Kerstie Forsyth from Power NI said the company hoped to extend its current client portfolio soon.
“As regards offering both electricity and gas, this is something we are looking at being able to offer in the future,” she said.
The Consumer Council has welcomed the prospect of Airtricity offering a dual fuel tariff of both electricity and natural gas to its customers as long as it provides a “genuine saving” to them.
Economist John Simpson said he was slightly concerned that, instead of developing competition for customers in the Belfast area, two potential competitors have now become one.
The Utility Regulator said it welcomed the entry of a new investor as a vote of confidence in the gas supply market in Northern Ireland.
Facts and figures
Cost of the deal which has still to be approved by Irish regulator
Number of customers supplied by Phoenix
The number of customers to benefit from dual billing
Questions and answers
Q How many Phoenix Gas customers are affected by the takeover?
A Around 130,000 in total — 123,000 household customers and 7,000 industrial and commercial customers.
Q What happens if you are a Phoenix customer?
A Phoenix customers will be transferred across to Airtricity under the existing terms and conditions in their contract. This won’t happen until the deal has been formally approved by the Competition Authority in Dublin. That could take up to a month, after which the transfer process will begin.
Q What will happen to my bills?
A You will continue to get two separate bills for several months while a system is put in place to issue single bills.
Q Will Airtricity offer a single dual fuel tariff?
A Initially, customers will be billed at their current electricity and gas tariffs. Airtricity has, however, said it will review its dual fuel options with the Utility Regulator after the deal is approved.
Q Can Firmus Domestic gas customers switch to Airtricity?
A If you are outside the Greater Belfast area, in one of the so-called ‘ten towns’, you will not be able to switch over until 2015, under rules set down by the Utility Regulator. That means existing Airtricity electricity customers in those areas will not be eligible for dual fuel for three years.