Oversight of immature power market pledged
BUSINESS consumers, suppliers and the authorities must all play their part in ensuring that competition develops effectively within the single electricity market (SEM) Electricity Regulator Shane Lynch said yesterday.
Speaking as the body published the results of its inquiry into business electricity tariffs, he said it was important that consumers, particularly SMEs, ‘learnt’ how to shop for power and that suppliers were as transparent as possible.
The inquiry was prompted following complaints by business customers who experienced a rise in their electricity bills after a rebate, intended to reduce pressure during the recession, ended in September last year.
That led to significant rises in tariffs of an average 30 per cent and as much as 50 per cent in some instances Mr Lynch said.
The inquiry was based on 17 written complaints but at a meeting at the Regulator’s offices in November there was widespread anger and dissatisfaction also at the apparent lack of awareness within the Regulator’s office of what was going on.
Bryan Gray, Chief Executive of the manufacturing lobby group NIM, said the report was disappointing and that energy costs would continue to hamper the local market and damage prospects for foreign direct investment (FDI).
“His report does not reflect the depth of concern in the business community about the level of energy charges here,” he said.
Stressing that the inquiry was set up specifically to look at the end of the rebate period and the way it was communicated to customers, Mr Lynch said it was clear there were lessons for all.
Comparing quotes between electricity suppliers was not straightforward and some customers found their electricity bills difficult to understand and missed the information about the rebate ending, he said.
Declining to name the three suppliers involved, he fell short of suggesting that they had taken advantage of the immature market.
“All the suppliers in question could improve and I think that they are aware of that,” he said.
“The market needs active suppliers and well informed customers to reach its full potential. We will meet with suppliers at the earliest opportunity to discuss how the operation of the market can be improved.
With many of the larger players already out in the marketplace, Mr Lynch said many of the remaining, smaller firms were the ones still tied to NIE Energy Supply.
“What we have seen over the last 10 years is progressively increasing competition at the large user end of the market.
“Of our 57,000 business customers in Northern Ireland, 66 per cent of them are still with their incumbent [original] supplier NIE Energy Supply.
“There’s a real opportunity now for SMEs, it’s important that they put some recources into this.
“We as regulators will do all that we can to facilitate that provision of information, but it’s important that they shop around and it’s important that they shop around on their terms because their business is up for grabs.”
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Thursday 24 May 2012
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