asked the Minister for Energy the way in which he intends to price the output of natural gas to the various users in the future to ensure the most productive use of this resource.
Ceisteanna—Questions. Oral Answers. - Gas Pricing Policy.
9.
I am at present reviewing gas pricing policy and hope to reach conclusions on this subject in the fairly near future.
Where does the Minister stand in relation to the Fianna Fáil commitment in the Programme for National Recovery, which says that the system which creams off maximum short term profit for the State through high prices for natural gas would be changed to a system of flexible pricing with gas at favourable rates in key areas? How does he gel his party's view of pricing with that of the NESC report on the pricing of natural gas which favoured all users being charged a price which would clear the market?
The terms of reference of my review of the gas policy are exactly as those read from the Fianna Fáil Programme for National Recovery. That section of the programme is the guiding principle in my review and I have not come to a decision on it yet. However, I am seeing how it can be implemented.
Would the Minister answer the second part of my supplementary? How does he see that as being consistent with the NESC recommendation that users of natural gas should be charged a price that would clear the market, in other words, all users being charged the same price?
There are varying pricing structures at the moment, from industrial to residential to other uses, ESB, NET and so on, and I am reviewing the overall scheme. I will be making announcements on this in the near future.
Does the Minister not accept that——
We must move on. I am calling Deputy McDowell.
In view of the Minister's reference to electricity pricing on a comparative basis, can he tell me if his Department keep records of comparative price information in relation to sources of energy? If so, could he explain why when I asked about electricity matters, my question was disallowed on the basis that this was a matter for the ESB? How can it be a matter for the ESB in one case Would he do me the courtesy of giving me the information I sought?
There is a question on today's Order Paper dealing with that subject and I will be answering it later.
I should like the Minister to clarify one aspect of his reply to Deputy Bruton in relation to the pricing of natural gas. Does he accept that there has to be a market clearing price for natural gas rather than the artificial pricing for various sectors? Does he accept that natural gas has to make a return to the State which would be a return from the marketplace rather than an artificial pricing which is the alternative?
The overall principle, as the former Tánaiste will be aware, is that at present Kinsale gas is being looked at on the basis that it is sold at a price not lower than the oil equivalent. What I am looking at is the potential for an injection into the economy, particularly into the industrial area, of natural gas at a lower price which would be a boost to industry. This matter is being reviewed but I have not yet reached a final decision on it.
A final short supplementary.
Does the Minister not accept that if we have a system where discounted prices are being given to selected users, we are talking about the inefficient use of a very scarce resource and we are further talking about a hidden subsidy to industrial users the precise extent of which this House will never know?
It will not be on the basis of individual users because there is no power under the Act to do that, but to particular sectors of the economy. We see the potential of using natural gas as a boost to industry at a time when it is facing strong competition from abroad. We believe this is an area which deserves a review which we are undertaking.