Gas Hike Hits Hard - But Water Costs May Soar Too

The clean, green and 'cheaper' energy option that was hailed as the way forward for local customers signing up for Phoenix Gas has proved difficult to justify.

Executives at the supplier have been hard-pushed to justify a stunning jump in the cost of their product - especially as their customers have little or no option once the supply is installed.

Customers of the natural gas supply company will now see the average annual bill hit £584 from May 1 - up £129 a year or some £2.48 a week.

The big increase comes a year after the company got a big public relations coup when it managed to reduce its tariff by 15% - something it has held until now.

However, in the latest in a series of rises to hit householders who have had to endure ever-increasing rises in the costs of food, heating oil and the petrol or diesel for their cars - this respite is at an end.

Phoenix General Manager David Strahan said there was one simple reason for the increase - world wholesales prices which were driven by the rise in the price of oil.

"Phoenix, like all energy companies across the UK, is experiencing record high wholesale gas costs which account for 60% of our price.

"We have been able to hold our price at the current reduced level throughout the peak winter heating period, when customers use most gas, but in the face of such large increases in wholesale gas costs, we have no alternative but to review our prices."

He insisted that the price of a 'therm' of gas on the international market was 25p this time last year but was now something like 65p - an increase of over 150%.

Meanwhile, water bills will soar from 2010 unless costs are brought under control, according to the Consumer Council NI.

It has accused the Northern Ireland Water company of "costly mistakes, flaky data and flawed business plans".

The Council called on Regional Development Minister Conor Murphy to guarantee future bills would be fair.

A spokesman for NI Water said until the Executive agreed a charging procedure projections of domestic bills must be regarded only as a broad estimate.

In February, Northern Ireland Water admitted it had made a miscalculation in its projected revenue. The shortfall was estimated to be £13m this year and £20m next year.

Eleanor Gill of the Consumer Council said: "We have already seen how basic miscalculations in the strategic business plan are going to cost domestic customers an extra £16m this year, rising to £30m in only two years' time.

"This is unacceptable at a time when household budgets are under growing strain to cope with other rising costs.

"Consumers can ill-afford to pick up the tab for these costly past mistakes. They will want to be assured that there are no more nasty surprises ahead. "Consumers need assurance that this water bill is not going to get out of control come 2010. "

(BMcC)