Average Northern Ireland gas bill to go up by £11

gas Phoenix Gas wanted to raise bills by £24

Related Stories

The average household gas bill in Northern Ireland is set to increase by £11 a year following a decision by the Competition Commission.

The ruling strikes a compromise in the row between Phoenix Gas and Northern Ireland's Utility Regulator.

Phoenix wanted to raise every customer's bill for the period 2012 to 2013 by £24 a year.

The utility regulator disagreed and wanted to reduce bills by around £1 a year instead.

That would have slashed the price of gas for big businesses in Northern Ireland.

Phoenix, which operates and maintains the gas network, said that would not allow them to make enough money to attract future investment into the firm, which is owned by their parent company Terra Firma.

After reaching a stalemate, the issue was referred to the Competition Commission, and now it has announced its final judgement.

The average household gas bill will go up by £11 a year, once Wednesday's announcement is implemented.

Utility Regulator Shane Lynch said that "for large businesses, this will add tens of thousands of pounds to their annual gas bill".

Mr Lynch now has to modify Phoenix's licence to operate to reflect the Competition Commission's ruling.

The Competition Commission stated: "We think it is appropriate for Phoenix to be able to earn the agreed rate of return on its investments. We also think that removing elements of Phoenix's regulatory asset base, which it had earned under the rules applying at the time, could damage investor confidence."

They also point out that the ability to attract investors in the future is particularly important in Northern Ireland because the gas network still needs to be developed as significant areas of the country still remain unconnected to the grid.

The conclusion of the Competition Commission that it thinks "the long-term public interest is best served by a stable environment that encourages confidence and investment" will also have wider implications.

NIE is currently in a dispute with the regulator along similar lines, as it is being blocked from raising the price of electricity in Northern Ireland.

Having rejected the regulator's proposals, it has yet to refer its dispute to the Competition Commission and may well have been waiting to see the outcome of the Phoenix dispute before making its next move.

More on This Story

Related Stories

More Northern Ireland stories

RSS

Features & Analysis

  • SyedTanks instead of toys

    Lyse Doucet on the plight of children in Syria and Gaza


  • Silhouette of manSuper-shy

    Why do Germany's super-rich so often keep their heads down?


  • Children playing in Seoul fountainDay in pictures

    The best news photos from around the world in the past 24 hours


  • Gin drinkerMother's ruin

    The time when gin was full of sulphuric acid and turpentine


Elsewhere on the BBC

  • EscaladeBling's the thing

    The ostentatious Cadillac Escalade cruises into 2015 with fuel-gulping gusto

Programmes

  • The smartphones of shoppers being tracked in a storeClick Watch

    How free wi-fi can enable businesses to track our movements and learn more about us

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.