SSE Airtricity announces 7.8% gas price increase from 1 April
SSE Airtricity, Northern Ireland’s market-leading provider of natural gas, is today announcing a 7.8% increase in its regulated natural gas prices from 1 April 2018 for its home and small business customers.
The price increase means a typical household natural gas customer will see gas costs rise by £39 annually, equivalent to 11 pence per day1. The increase has been examined and approved by the Utility Regulator.
The change in gas prices is as a result of a rise in external costs outside of SSE Airtricity’s control. These include increases to charges for using gas networks, which affect all suppliers, as well as sustained increases in the cost of wholesale natural gas on global markets2.
Today’s announcement follows the annual review by SSE Airtricity of costs associated with its regulated natural gas supply business. This gas price review, which is conducted at this time every year, was completed by SSE Airtricity in consultation with the Utility Regulator, the Department for the Economy, and the Consumer Council of Northern Ireland (CCNI)3.
Andrew Greer, General Manager of SSE Airtricity Gas, said:
“We’re sorry we have to announce an increase in our regulated gas prices. This decision is not taken lightly and is driven by rising external costs outside of our control, including cost increases for transporting gas to customers via the networks and continued increases in the global wholesale cost of natural gas.
“We’ve worked hard to help reduce the impact of these external costs, and our customers can be assured that this change has been examined and approved by the Utility Regulator.
“As always, we will continue to do everything to ensure we consistently deliver value to our customers in their gas supply, and to provide the greatest possible help and outstanding service that our customers expect from us.”
The price change applies to 150,000 SSE Airtricity home and small business customers or around 75% of the natural gas market in Greater Belfast. The change also applies to customers on the Gas to the West network where SSE Airtricity is the commissioning supplier for the new network currently being developed4.
SSE Airtricity is a wholly-owned subsidiary of the FTSE-listed and Scotland based SSE plc.
- Equivalent cost of price increases based on a household natural gas customer on standard 24hr credit meter tariffs (Home Energy Standard) with typical annual medium level domestic consumption of 12,500 kWh. Figures rounded to the nearest Pound value and are inclusive of VAT. Actual costs vary according to meter type, individual tariff and consumption.
- 6.125% change in forward global wholesale gas costs based on 12-month comparison of UK Natural Gas Futures, 1 April 2017 (43.181 pence per therm average during Q32016/Q42016) and 1 April 2018 (45.826 pence per therm average during Q32017/Q42017); source: Intercontinental Exchange (NYSE: ICE)
- Under the annual Natural Gas Price Control review process, the setting of SSE Airtricity’s regulated natural gas prices, including any changes to those prices, require the Utility Regulator’s formal approval. Annual price changes, if they are to be applied, take effect from 1 April each year. The Price Control process also allows for an interim or 6-month review by the Regulator of SSE Airtricity’s natural gas tariffs with any mid-year price changes, if required, taking effect from 1 October each year.
- SSE Airtricity provides natural gas to 150,015 Domestic and Small Industrial & Commercial customers in the Greater Belfast area (74.6% market share). Figures quoted based on latest Retail Market Monitoring Quarterly Transparency Report Q4 (Oct-Dec) 2017 published by the Utility Regulator, February 2018. SSE Airtricity provides natural gas to less than 10 Domestic customers on the Gas to the West Network, as at 31 December 2017.