Belfast Telegraph

Huge 39.1% price rise rocks Phoenix gas users

By Claire McNeilly

More than 19,000 households in Northern Ireland could plummet into fuel poverty after an unprecedented hike in the cost of gas, it has been warned.

Phoenix Supply has confirmed a 39.1% increase in gas prices from the beginning of next month — adding an extra £173 to average annual bills.

That means consumers, many of whom are already struggling to make ends meet, can expect yearly expenditure on natural gas to rise from £430 to £603.

Phoenix has blamed the hike on significant increases in wholesale energy costs as a result of a surge in international oil and gas prices.

But the Consumer Council said the imminent increase will see the number of “fuel-poor” homes surge from 345,730 — one in every two households here — to 364,730.

Its chief executive Antoinette McKeown also said it will result in gas bills here being 22% higher than elsewhere in the UK and 17% more than in the Republic.

“We recommend that all gas customers check if they can get a better deal by switching,” Ms |McKeown said.

“Phoenix has limited control over prices as this is a regulated |industry, but it does have control over action to alleviate the impact on consumers experiencing hardship.”

Managing director of Phoenix David Strachan said he understood the hike — which will add £3.28 a week to average household bills — was “unwelcome news”.

“The revised tariff sets natural gas prices at around 12% below the level they were back in 2008,” he said.

“Our customers can be assured that we are committed to delivering gas at the lowest sustainable price, both now and in the future, and if worldwide energy prices fall we will move quickly to reduce our prices accordingly.”

Shane Lynch, Northern Ireland’s Utility Regulator, said prices for winter are 77% higher than for the previous winter.

“We regret having to approve any price rises and are conscious of the impact on household budgets. In recent months wholesale fuel costs have been volatile, influenced largely by events in Japan and Libya,” he said.

Mr Lynch added that setting prices was a “two-way street” and he would continue to operate in the best interests of householders.

Firmus Energy, Phoenix Supply’s principal competitor, last month vowed to freeze its prices at their current level until October.

It has also made a commitment to keep prices below Phoenix’s for at least two years after a customer switches — although Firmus will also have to review its prices in six months.

Mark Prentice, managing director of Firmus, claimed yesterday that 65,000 homes in greater Belfast could make savings by switching.

He added: “Our energy customers will now pay natural gas prices which are 33.5% less than Phoenix, which could equate to a saving of over £220 for an average home over two years.”

However, 55,000 pay-as-you-go gas users will not be able to switch supplier until September 2011.

Representatives from the Northern Ireland Fuel Poverty Coalition (FPC) have described the news as “very, very worrying”.

FPC member Pat Austin, who is also chair of National Energy Action, said : “This is very bad news, particularly when fuel poverty here is at the worrying level of affecting every other person here.”

Factfile

  • Phoenix Gas customers = 135,000
  • Customers registered to switch to Firmus = 2,400
  • Number of customers who could switch = 65,000
  • Number of customers who can’t (pre-payment) = 55,000

The charts

Charts showing the change in gas prices over the past two years for Phoenix customers. The first chart details the difference in costs compared with Firmus for Phoenix customers not paying their bills by direct debit, and teh second, for those who do pay by direct debit

Click here to view larger chart



Click here to view larger chart

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