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Energy Regulation (Continued)

Tuesday, 11 June 2013

Dáil Éireann Debate
Vol. 806 No. 1

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 52. Deputy Michael Moynihan Information on Michael Moynihan Zoom on Michael Moynihan asked the Minister for Communications, Energy and Natural Resources Information on Pat Rabbitte Zoom on Pat Rabbitte the measures he will take to enhance competition in the energy market; the actions he will take to protect Ireland from external energy price shocks; if he will examine the remit of the Commission for Energy Regulation; and if he will make a statement on the matter. [27899/13]

Minister for Communications, Energy and Natural Resources (Deputy Pat Rabbitte): Information on Pat Rabbitte Zoom on Pat Rabbitte The Government remains firmly committed to increasing competition as the best means of exerting downward pressure on prices in the electricity and gas markets in Ireland. Currently, there is competition in both the electricity and gas markets, with many players competing in both the wholesale and retail segments of the electricity market and in the retail segment of the gas market. Business and domestic consumers can choose from a range of suppliers in both electricity and gas, thereby availing of the benefits of competition.

  Electricity and gas costs in Ireland are influenced by various drivers, with global gas and oil prices being the most significant factors. Among other factors over which we have little or no control are exchange rate movements, the cost of capital, EU legislative obligations and unfavourable international events, as well as our small size, geographical location, low population density and population dispersal. Given the reality of how much these factors affect prices, it is clear there is little scope for protecting Ireland from external energy price shocks.

  The main opportunities to mitigate the impact of external price increases are in focusing on greater energy efficiency and diversity of fuels. Energy efficiency represents a significant opportunity for both businesses and households to reduce their energy costs and mitigates the impact of external price rises. Achieving the Government’s target of generating 40% of our electricity from renewable sources by 2020 would provide greater diversity of fuel supply and would also help to offset the impact of volatile fossil fuel prices.

  The remit of the Commission for Energy Regulation, CER, is set out in the Electricity Regulation Act 1999, as amended. More generally, with the deregulation of electricity and most gas retail prices, the primary focus of the regulator, as far as prices are concerned, is its joint oversight with the Northern Ireland regulator of the all-island single electricity market, its scrutiny of electricity and gas network costs, which feed into retail prices, and its general consumer advice and protection role. The statutory functions of the regulator require it to consider and decide on very complex issues.

  Additional information not given on the floor of the House

The CER's ability to strike an appropriate balance between competing demands is noteworthy. The CER is required, first, to promote efficient, orderly, fair and competitive markets, second, to facilitate investment, and third, to protect consumers’ interests. Striking such a balance requires considerable knowledge, skills and expertise. While the roles of regulators are continually monitored, I have no specific plans to review the remit of the CER in the near future.

Deputy Michael Moynihan: Information on Michael Moynihan Zoom on Michael Moynihan I thank the Minister for his reply. We have seen reports in recent weeks about the increase in the number of households whose gas or electricity supplies were cut off during 2012, and that figure is still increasing. Is the Minister satisfied with the role the regulator is performing and the duties it is carrying out?


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