GAS PRICES, which are being cut by 12 per cent next month, may be reduced by another 10 per cent in the autumn, according to the energy regulator.
The Commission for Energy Regulation (CER) says it should be able to pass on a 9-10 per cent reduction in tariffs before the winter, provided the international wholesale price of gas remains low.
A further reduction would effectively take consumers back to where they stood before last September, when prices soared by 20 per cent.
This increase, and a cold winter, resulted in massive gas bills for many householders after Christmas.
However, hopes of a further price drop may yet be dashed. According to CER, many analysts fear further volatility in the energy market, of the kind which led to massive spikes in oil and gas prices last year.
If this happens, it is unlikely that consumers would benefit from further reductions in the tariffs.
Electricity tariffs charged by ESB and other providers are also set to drop next month, by 10 per cent.
The CER this week confirmed its intention to reduce the prices charged by Bord Gáis to domestic and small business users by 12 per cent from May 1st “in view of the exceptional difficulties currently facing the economy”.
The reduction has been made possible by steep falls in the price of wholesale gas, the strength of the euro against sterling – the currency in which gas is sold – and the fact that consumption was so high, at the higher tariff, during the cold winter.
Fine Gael’s energy spokesman Simon Coveney criticised the level of the decrease and claimed consumers were still being ripped off. He said the price of wholesale gas had dropped by up to 40 per cent since last December, so a reduction of about 20 per cent in domestic tariffs was therefore called for.
“Ireland is in deep recession. We need to bring some relief to businesses and household owners in terms of energy costs,” Mr Coveney told RTÉ radio yesterday.
However, energy regulator Dermot Nolan said CER was passing on all it could. Prices should have risen by 40 per cent last September but this would have been too much for consumers to bear and so the commission had smoothed out the price changes.
The CER intends to undertake a further review of gas prices over the summer, to be implemented at the start of October.
