Dáil Éireann Debate, Thursday - 26 September 2013
162. Deputy Michelle Mulherin asked the Minister for Communications, Energy and Natural Resources the reason and the basis on which the Energy Regulator decided to deregulate Bord Gáis energy prices at 55% market share notwithstanding the conventional wisdom that in order for competition to work best in this sector for the benefit of customers no generator should have in excess of a 40% share; and if he will make a statement on the matter. [40252/13]
View answerResponsibility for the regulation of gas markets is a matter for the Commission for Energy Regulation (CER) which is an independent statutory body. These regulatory powers are granted to the CER under the Gas (Interim) (Regulation) Act 2002 and subsequent Irish and European legislation. Ireland’s gas market, both wholesale and retail, is characterised by increasing competition, regulated by the CER. Since 1 October 2011, the only segment of the market where retail gas prices are regulated by the CER is Bord Gáis Energy’s residential customer prices. The Deputy will be aware that a sale process is in progress under which the energy supply business of Bórd Gais Eireann will transfer to the private sector. Prices in the unregulated parts of the retail gas market are wholly commercial, are set by the suppliers and are variable in accordance with supplier offerings.
The CER has published a roadmap setting out the criteria that must be met to allow it to deregulate the residential gas market. The criteria are:
- at least 3 suppliers, of which two are non-Bord Gáis Energy suppliers must be operating in the market - each of these must have a market share in excess of 10% of customers;
- there must be customer switching rates in excess of 10% per year; and
- the threshold for deregulation of Bord Gáis Energy is 60% (customer share) with rebranding of its retail business and without rebranding the threshold is 55%.
I understand that steady progress is being made, with the regulator continuing to monitor progress closely. I have no statutory function in regard to the regulation of prices in the gas market.
