Ashford to Outline Response to Gas Hike

Newly appointed Treasury Minister David Ashford is likely to come to Tynwald on Tuesday with some measures designed to help those on the lowest incomes with the seemingly impending gas price hike.

Tynwald will be asked on Tuesday to approve a 27.5% increase to the cap on gas prices as the worldwide soaring price of gas bites down on islanders.

Speaking to Gef Mr Ashford the Treasury will need to see measures it can use to help lower income families and pensioners who receive a winter fuel allowance.

He said: ‘We need to look at what we can do to help the most vulnerable consumers. Obviously with the way the wholesale gas market is at the moment, this is causing problems around the world. But here in the island it is important that as Treasury we do look to see what we can do to protect and insulate those who are in the most vulnerable position and that will of course include those in sheltered accommodation.

‘I know Treasury, prior to me becoming Minister today, has been working on plans around that and I’m hoping to engage with Treasury so that by the time we get to the Tynwald sitting on Tuesday when this is considered, I may have something that I can share publicly and wider with political members.’

Why are we here?

The gas price cap was introduced when talks between there gov and Manx Gas broke down over a new voluntary agreement. In its place came legislation which limited the price of gas to domestic consumers on the island.

Could they just say no?

While the global cost of gas has risen and Manx Gas have admitted they are losing money on gas sold to the island at the moment, Tynwald members still have a decision to make. They could potentially just refuse to do it, vote it down and say they will not implement a 27.5% increase on islanders.

However, despite how unpopular this move will be ahead of the winter, it does seem unlikely that the new Tynwald will take such a bold move. We know they had a briefing with chief executive of Manx Gas’s parent company Islands Energy Group Jo Cox but we don’t know what was said other than outlining the losses Manx Gas is currently making on gas it is selling to islanders. We also know that Ms Cox has said the increase would only allow the company to break even and that if the wholesale gas price drops then the company will drop its prices.

Ultimately we’ve seen energy companies go under in the UK and while it is unlikely this will happen to Manx Gas, no one has really outlined what the future holds if Tynwald decides to take a stand just say no. We should know what the plan is by Tuesday evening, we can expect some dissent from the backbench but it is likely the writing is on the wall.

One thought on “Ashford to Outline Response to Gas Hike”

  1. Why didn’t the IEG hedge against the statutory price cap? If the price had gone down, they wouldn’t have reduced the price.

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