Introduction
The Commission has regulated the natural gas market since 2002. The Commission has a number of statutory responsibilities to regulate, examine and approve how Bord Gáis Energy Supply charges its customers. Prior to regulation, Bord Gáis Energy Supply was the only natural gas supplier in the Republic of Ireland. This meant that when competition in the natural gas market was introduced, Bord Gáis Energy Supply had the advantage of serving all customers. In order to allow competition to develop and to ensure customer protection in relation to how they are charged, the Commission has regulated Bord Gáis Energy Supply tariffs since its establishment. Since 2003, the Commission has done this by conducting an annual review of tariffs.
In addition to regulating supply tariffs, the Commission also regulates and approves the tariffs associated with the transmission and distribution networks.
The Commission approves tariffs based on the submissions made by Bord Gáis Energy Supply and Bord Gáis Networks. These submissions are examined to ensure that any changes in tariffs which are passed onto the customer are appropriate.
Your tariff includes the cost of purchasing gas, transporting it through the gas network, distributing and supplying to your home.
When approving tariffs the Commission aims to ensure cost-reflectivity on a sustainable basis. In practice, this means balancing what is charged to customers with what is needed to supply customers and make sure that the gas network is maintained.
What Drives the Price of Gas?
Independent Suppliers' Tariffs
Regulated Supply Tariffs
What drives the price of Gas?
The price of gas is dependent on a number of factors;
- The actual global wholesale price of gas;
- Foreign exchange rates;
- The price of using the network to transport gas to the customer’s premises; and,
- The operational supply cost and capital expenditures required to deliver a gas supply service to customers.
The global wholesale price of gas accounts for approximately 60% of the overall price of gas. The cost of using the transmission and distribution networks to actually deliver the gas accounts for approximately 30% of the overall price, and the operational and capital expenditure costs account for the remaining 10%.
Independent Suppliers' Tariffs
On 1st July 2007 the natural gas market was opened fully for domestic competition. Prior to this to encourage competition in the domestic market, the Commission awarded a franchise to Flogas Natural Gas to supply gas to domestic customers in the west of Ireland. The Commission does not regulate the supply tariffs of Independent Gas Suppliers. While the network portion of tariffs is the same for all domestic customers, they can offer different prices for the gas consumed.
Link to current Flogas Domestic Tariffs
Regulated Supply Tariffs
The Commission regulates the tariffs offered to customers by Bord Gáis Energy Supply. Prior to any change in the charges to customers, the Commission receives a full submission setting out its costs to serve customers, its cost to purchase gas and any other factor which impacts the proposal. The Commission then examines these costs to determine whether the requested change is appropriate. This process usually takes a number of months to complete. Once the review is completed the Commission publishes its decision in relation to any change and Bord Gáis Energy Supply then implements it.
See BGES web site for current tariff information