By Peter O’Dwyer
Families struggling to cope with the rising cost of utilities could be set to benefit from cheaper gas prices thanks to the deregulation of Bord Gáis Energy.
New Bord Gáis customers could see a decrease of up to €140 in their gas bills if the newly deregulated company aims to compete with the cheapest providers in the market.
Consequently, competitors could also be encouraged to offer cheaper price plans in light of increased competition.
Following an announcement in May, the regulation of the gas supplier came to an end on Tuesday, meaning that it is now free to set its own gas rates without the approval of the Commission for Energy Regulation, as was previously the case.
This is likely to result in increased competition and lower prices for consumers, according to communications director of price comparison experts bonkers.ie, Simon Moynihan.
Bord Gáis Energy’s most likely move may be to offer discounted “dual fuel” rates.
“What they’re most likely to do is take their discounted electricity product and bundle it with a discounted gas product and they’ll have some sort of discounted dual fuel offer that they’ll launch in time for the autumn switching season,” said Mr Moynihan.
By encouraging customers to sign up for online billing and direct debit payment, the company may be in a better position to pass on improved rates too, he says.
With wholesale gas prices at their lowest level in four years (30% cheaper than this time last year) there is scope for the newly deregulated provider to lower prices should it wish to do so.
Having lost 45% of its customers in the last four years, it seems likely that they will look to win these back, said Mr Moynihan.
Competitors FloGas and Energia offer gas at prices up to €140 cheaper, setting this as the benchmark should Bord Gáis Energy wish to offer similar rates.
Speaking in May, Bord Gáis Energy managing director Dave Kirwan alluded to the company’s low cost electricity prices and the possibility of dual fuel offers, saying, “For the last three years, Bord Gáis Energy has offered the lowest standard electricity prices for domestic users in the deregulated electricity market. We are delighted that gas deregulation now offers us the ability to offer our customers new gas products which best meet their needs, as well as dual fuel energy offers for our customers.”