GE looking to make future price rises more manageable
GUERNSEY ELECTRICITY is looking at more pragmatic ways of recovering costs in future, said its chief executive.
Alan Bates was commenting in the wake of the Guernsey regulator announcing its backing for GE to increase its prices by 4.8%.
The rise will come in on 1 September and GE said it will be in place for three years.
The increase will enable the company to recover uncontrollable historic costs of £7.6m. that stem from the importation and generation of electricity and which are due mainly to changes in the price of oil and exchange rates from April 2019 to March this year.
‘The increase was scheduled to be implemented in April but due to the potential effects of the pandemic, we agreed with the regulator to delay the change to help our customers through this period,’ said Mr Bates.
‘This is only the second increase since 2012 and equates to an additional £50 per year for an average Economy 12 customer.’
He said GE was aware that the lack of regulatory activity concerning tariff levels has impacted on both the company and its customers and it will ‘continue to promote the need for a smoother and more transparent tariff evolution for the future’.
The issue was raised at the recent States debate about the energy policy, in which this lack of regulatory activity since 2011 was highlighted.
‘[It] has led to a tariff structure that is not fit for purpose, is misaligned to the drivers of cost change and has had an impact on both the market and electricity consumers. We are mindful of the effect of these large increases and are aware that it is hard for our customers to plan or budget for the increases. We are working to find more pragmatic ways to recover costs in future.
‘This would, ideally, mean rises that are smoother, more manageable and incremental.’
Mr Bates added that as Guernsey develops its plan for recovery from the Covid-19 crisis, the island will require a new approach to tariffs ‘that balances affordability for customers along with the ability for Guernsey Electricity to invest in its infrastructure’.
n Customers with concerns about the tariff rise can contact Guernsey Electricity through customer.accounts@electricity.gg.
n GE said the tariff change was not connected to last year’s capital project which saw the utility replace the electricity cable between Guernsey and Jersey and switch to the importation of 100% renewable energy in early 2020.
