Gas customers may face another major hike in their bills after the energy regulator today proposed to award Bord Gais a price increase of almost 34 per cent.
Under draft proposals drawn-up by the Commission for Energy Regulation (CER) it proposes to award Bord Gais an increase of 33.8 per cent, representing €704 million in revenue, in prices to home and small commercial and industrial customers.
"The reality unfortunately is prices have grown for us over the last 12 months by 50 per cent, so going forward we have to commit ourselves to €150 million worth of more purchasing than we did last year and we have to pass that back to the consumer," David Bunworth, head of energy supply for Bord Gais, said.
"I realise that is regrettable but there is no other choice for us but to recover those costs." Bord Gais has said the rise would mean an increase of 84c a day for the average residential customer.
The company had applied to the CER for a 38.3 per cent increase from October due to the sharp rise in the cost of buying gas. IBEC said the proposed increase in the charges of 33.8 per cent was due to Ireland's 90 per cent dependency on imported fuels.
David Manning, IBEC's energy executive, said: "This increase has serious negative implications for the manufacturing industry in Ireland. This is an issue of critical national importance which the Government must address with a suite of measures to alleviate the cost burden."
IBEC said the Government should ensure increased competition in the electricity and gas supply market and called for excise duty relief on fuels.
The commission said the main reason for the increase in customer tariffs was related to the costs of buying gas, which have increased by just under 50 per cent.
Bord Gais said it was now required to buy more gas at current market prices as its long-term contracts for buying gas are running out.
The commission said following a period of consultation it would make a final decision on the size of the price increase in late August.