Bailiff to rule in power price deals case

GEL is actioning the Guernsey Competition and Regulatory Authority after it was instructed to publish details of what it was charging these companies. GEL wants that decision quashed.

For GEL, Advocate Mark Dunster said that should the court find that the company had failed to comply with the terms of its licence by not publishing this information, he would argue that it was not proportionate for GEL to have to publish it, and he would also submit that the GCRA had not acted in accordance with its own guidance.

The relevant condition related to GEL being obliged to public information about new prices, discounts or special offers.

Advocate Dunster said this applied only to those offered to the vast majority of its 30,000 customers, and it did not apply to a handful – four, in total – of commercial firms with which GEL had entered into a special arrangement, which it was entitled to do by virtue of another section of the law.

International Energy Group, of which Guernsey Gas is a part, had complained to the regulator about GEL’s deal with one of these companies, but the advocate said that the GCRA had never instituted an investigation into this complaint.

He said that what appeared to have happened was that the complaint had ‘morphed’ into the matter which had led the regulator to tell GEL that it had to publish all of the prices that it was offering to these four commercial clients.

But doing so would make public commercially sensitive information, he said, since there was often more to these agreements than simply setting a price. And there may well have been a list of prices, depending on the nature of the client’s business.

Bailiff Richard McMahon, presiding, suggested that if GEL had simply published the prices it was offering these four companies without naming them, that would be sufficient to comply with the regulator’s demands.

But Advocate Dunster argued that even if published anonymously, it would still be possible for a competitor to work out the nature of the company receiving this special offer and therefore establish their identity.

Representing the GCRA, Advocate Mark Ferbrache said that the issue at the heart of the matter was whether or not the requirement for GEL to publish its figures also applied to the firms with which it had a special agreement.

He said that GEL seemed to think the only parties that needed to be involved in the setting of pricing under the terms of this section of its licence were the customer and GEL itself. He said that in effect this was ‘putting the rat in charge of the cheese cupboard’.

The four customers who had received these special prices were existing ones, and so under the terms of the licence the burden of proof was on GEL to show that it was not reasonable for it to be expected to supply electricity at the normal tariff to these companies.

GEL was saying that it could use this section of the law to side-step regulation, he said.

He reiterated Mr McMahon’s point that GEL was being called upon to publish prices, nothing more, in relation to these special agreements.

It had not provided the regulator with any information at all relating to any of these agreements, and without this, Advocate Ferbrache argued, GCRA could not perform its function to regulate.

After hearing from both parties, Mr McMahon reserved his judgment.