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Deregulation of domestic gas market set for Spring 2014

Latest CER review suggests that deregulation in domestic gas market could happen by March 2014

The October review by the Commission for Energy Regulation has deemed that all the criteria required for the deregulation of Bord Gáis Energy in the domestic gas market are yet to be met.

Deregulation will therefore not occur in October and the criteria are predicted to be fulfilled in March 2014 – as stated in the September review.

One requirement is that a market share of 55% should be reached – if Bord Gáis Energy does not rebrand – but that is yet to be achieved.

Deregulation would assist the energy market in Ireland by increasing competition among gas suppliers and the CER is keen for it to occur.

It will also increase competition between energy suppliers and provide consumers with a greater chance of reducing their gas and electricity bills.

The October review is the sixth in a set of overall review installments looking at the state of the domestic gas market in Ireland, and deregulation is still some way off.

The CER will need to notify the market at least one month in advance of any potential deregulation and is still waiting on a branding decision from the energy company.

Bord Gáis Energy was given the option of rebranding in the original review which requires a 60% share of the market, instead of the 55% share mentioned previously.

The 60% market share required when rebranding has also not been reached and a delay in decision from Bord Gáis Energy has prevented any changes from going ahead.

The domestic gas market is covered by the review and the current market share is decided by the percentage of customers using each gas supplier.

Each review uses figures from the previous month suggesting it could still be five or six months before all criteria are met.

In September 2013, one of the criteria whereby two other suppliers hold a market share of 10% or more was fulfilled.

Share each of the domestic gas suppliers had of the energy market October 2013 

Market Share

Airtricity held 17.41% of the market, Electric Ireland held slightly more with 18.63% while Flogas was holding nearly 5% of the retail gas market.

Further criteria for deregulation would require a customer-switching rate of above 10% – October was more than 18.5%, thus satisfying this criteria.

Providing all criteria continue to be met between now and March, the CER could then announce the deregulation of Bord Gáis Energy.