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Energy Minister Eamon Ryan TD has welcomed the publication
of a Memorandum of Understanding (MoU) by the Energy Regulators,
North and South - the Commission for Energy Regulation (CER)
and its Northern counterpart, the Northern Ireland Authority
for Utility Regulation (NIAUR) - to work together to consider
the merits of establishing common arrangements for gas on
the island.
“This initiative by both Regulatory Authorities has
the potential to lead to positive benefits for gas consumers
- North and South - if analysis by the Regulators proves there
are significant benefits to be achieved in establishing common
gas arrangements and has the potential to build on previous
successes gained from collaborative approaches on energy matters,
including the roll-out of the Single Electricity Market last
year” - the Minister said.
The MoU commits both Regulators to work to consider the merits
of establishing common arrangements for gas, whereby all stakeholders
can buy, sell, transport, operate, develop and plan the natural
gas market - north and south of the border - effectively on
an all-island basis.
If such arrangements were to be established, the aim is that
variations in the price and conditions on which gas is bought
and sold will be determined by market conditions and economics
- not by variations in regulatory arrangements. The MoU also
commits both Regulators to considering a joint approach to
Security of Gas Supply, having regard to the heavy dependence
of the consumers on gas imports from the UK market.
Since 1st July 2007, the domestic gas market has been open
to potential new competitors. This will, over time, encourage
competitors into the open retail gas market. The possibility
of enlarging the gas market through creating mutually beneficial
- and economically sound - common arrangements for the island
of Ireland is aimed at stimulating competition by encouraging
new firms to enter the larger market.
Increased competition in the natural gas market will, potentially,
offer a number of important benefits to consumers - including
increased choice, greater efficiency, lower prices and higher
standards of service. It will also position the island’s gas
market to better integrate with the UK regional market as
a whole.
“This initiative follows-on from discussions with Minister
Nigel Dodds MP in November of last year, when we agreed to
work collaboratively on assessing the potential economic benefits
of developing common arrangements for gas. Over the coming
months, we will be keeping a close eye on developments from
the perspective of the emerging economic and social benefits
to consumers - North and South.
"The preliminary results of cost benefit analysis work
are positive and I am hopeful that, subject to a positive
full economic assessment of benefits from the Regulators,
consumers on both sides of the border may benefit significantly
from any agreed future common gas arrangements" - concluded
Minister Ryan.
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