Energy Price Hikes are 'Serious and Costly Mistake'
4 Oct 2006
Congress said today that the double-digit gas and electricity price increases are a "serious and costly mistake" and has called for a review of the energy regulator's decision.
Speaking at a conference in Dublin, Congress Economic Advisor, Paul Sweeney, described the energy regulator's decision to grant the price increases to the ESB and Bord Gais as "a serious and costly mistake that must be immediately reviewed. The decision was taken at a time of high oil prices - they have now fallen back substantially."
Mr Sweeney said a fairer approach would have been to introduce a fuel variation charge that would have capacity to reflect oil price fluctuations.
The conference - Towards Sustainability in the National Development Plan - was organised by Comhar.
Addressing problems in the energy sector, Mr Sweeney welcomed the government decision not to break up the ESB.
"It would have been wrong to do so," said Mr Sweeney "and run contrary to much available evidence and reason. Congress also commissioned research on this issue and the findings supported the maintenance of the ESB as a vertically-integrated utility. Other experts have reached similar conclusions including Dieter Helm of Oxford University and a recent ESRI publication.* Ultimately, a strong ESB is vital to security of our energy supply."
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* Comparison of Energy Degregulation Around the World & Implications for Ireland by Laura Malguzzi Valeri, in Quarterly Economic Commentary, 2006