Warm spring leads to 5.3% Isle of Man gas bill increase

Gas bills are set to rise by 5.3% from July after a dip in consumption in the first half of the year due partly to a warm spring, the sector's regulator has said.

The increase will see Isle of Man Energy customers pay about £24 more each year on average from 1 July, with tariffs being increased from 9.76p to 10.29p per unit.

The uplift, which affects domestic and small commercial users, follows the twice-yearly review of the charges by the Communications and Utilities Regulatory Authority (Cura).

Managing director of the energy firm Aidan Baglow said despite the latest tariff adjustment, prices would still be lower than they were at the same time last year after a 13.8% drop was introduced in January.

Cura carries out at least two reviews a year of the gas tariffs charged by the island's monopoly gas supplier.

It was set up as a regulator in 2020 with a remit of reviewing the tariffs and profits of the energy provider.

Isle of Man Energy is bound by regulations to keep its overall returns within the parameters set by the watchdog to stop it making excessive profits.

Following its latest statement, Cura said the annual return for the firm had been overestimated in the previous review, therefore the tariff would need to increase for the remainder of the year.

It explained that while wholesale costs on average had come down across the period, there had also been a dip in consumption in the first half of the year due a warm spring.

Highlighting the "continued volatility" in global gas prices, Mr Baglow said those costs had increased "almost immediately" after January's reduction.

He said the latest 5.3% rise was "necessary" to "recover our network costs".

The next tariff review is set to be carried out in November, with any further changes to tariffs implemented the following January.