Gas firm turns up heat on rivals by slashing prices



By Charlie Weston Personal Finance Editor

Tuesday October 05 2010

A SECOND gas company has slashed the price it charges to supply households in a move that is seen as a significant step-up in competition.

Irish-owned company Flogas has cut its prices to compete for consumers.

Two weeks ago British energy company Airtricity turned up the heat on Bord Gais by offering a discount of 20pc on domestic gas supplies.

But to benefit from the big cut, consumers have to sign up for a year and also get electricity from Airtricity

Flogas, which is owned by Irish Stock Exchange-quoted company DCC, said it would offer a 20pc discount on the price charged by Bord Gais.

However, those who want to get the benefit of this 20pc discount on the unit price of gas will have to pay a higher annual standing charge of €124.85. This is higher than the Bord Gais standing charge of €68.

Consumers who move to Flogas can also opt for a 15pc discount on the Bord Gais unit price by paying an annual standing charge of €68.

Director of price comparison site Bonkers.ie Simon Moynihan said the typical family spent €727 a year on gas with Bord Gais.

He said the best deal for a family that decided to switch to Flogas from Bord Gais would be to opt for the 15pc discount which would bring the annual bill down to €686.

He said the higher standing charge on the 20pc option meant the annual gas bill for a family would be higher, at €706.

Bord Gais is not allowed to compete with private operators by cutting its gas prices, as it is regarded as dominant in the market. But the gas company can compete on electricity supplies, where it offers a 13pc cut on the ESB tariff.


Mr Moynihan said a family that used both gas and electricity could make the biggest saving by getting gas from Flogas with the 15pc discount option, and by getting electricity from Bord Gais or Airtricity.

Switching to Bord Gais or Airtricity for electricity would cut €125 from the €1,000 a year average bill for a family.

More than 600,000 people have switched from the ESB for their electricity supplies.

The ESB is to be allowed to set its own prices when its market share falls below 60pc.

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