Carlinn Hall Gas Rates Issue Needs Immediate Resolution – Nash
23 March 2022
- Minister and Utilities Regulator wash their hands of Dundalk estate issue
- Regulator says it does not have power to regulate district heating schemes
An immediate solution must be found to a gas rates issue that is causing drastic price hikes for residents of Carlinn Hall estate in Dundalk, Louth and East Meath TD Ged Nash said today. Deputy Nash was referring to a situation where Dundalk residents have found themselves paying commercial rates for their gas bills, resulting in bills tripling over the course of three months.
Deputy Nash raised the issue again in the Dail on Tuesday;
“A number of Carlinn Hall residents have been in contact with me to explain that they have had to stop using their heating completely as they cannot afford to continue paying their out--of control bills. The invasion of Ukraine by Russia has accelerated the issue as fossil fuel prices have shot up across the country.
“I raised this in the Dail twice and Minister Ryan responded to a written question by essentially saying that he has no role in this. I asked the Commissioner for the Regulation of Utilities (CRU) to intervene and to make a determination that Carlin Hall residents are for all intents and purposes residential and not commercial customers only to be told that this is ultimately a contractual matter between the parties.
“I was alarmed to be told by the regulator that they have no function in regulating district heating schemes but that they expect to be given such a function in the future.
“The crisis for Carlinn Hall residents is being felt now.
“The Labour Party Finance Spokesperson, Deputy Nash, has identified a mechanism within the Consumer Act which allows for “maximum price orders” and has called on the Minister for Finance and Government to urgently examine the case for the introduction of such caps to help protect hard-pressed householders from rising energy costs.”
Speaking on the rising energy costs, Nash said;
“The Government is continuing to put the profits of energy companies before the basic needs of people facing exorbitant energy costs. The Labour Party has already called for a cap on petrol and diesel as well as a slashing of VAT on energy costs in an effort to protect consumers from the cost-of-living crisis and the effects of the war in Ukraine.
“Both the Minister and the CRU are washing their hands of this. Their message to Carlinn Hall residents is ‘you’re on your own’.
“It’s no use promoting district heating schemes if there is little or no regulation and protection for consumers.
“The classification of residential consumers as commercial ones is sharp practice and is nothing but shameful profiteering.”
NOTE TO THE EDITOR;
See PQ reply and letter from the CRU below.
For Written Answer on : 10/03/2022
Question Number(s): 168 Question Reference(s): 13661/22
Department: Environment, Climate and Communications
Asked by: Ged Nash T.D.
[Ref No.: 13661/22]
* To ask the Minister for the Environment, Climate and Communications if his attention has been drawn to ongoing problems with the communal heating scheme at a location (details supplied); his views on the energy provider’s decision to charge commercial, not residential gas rates which has contributed to rapidly rising energy costs for residents; if he plans to raise this with the energy provider and the Commission for Regulation of Utilities; and if he will make a statement on the matter. - Ged Nash.
Carlinn Hall estate in Dundalk, Co Louth - Energia
* For WRITTEN answer on Thursday, 10th March, 2022.
(627 Received on 4th March, 2022.)
Under the House of Tomorrow programme, the first phase of homes in this development were supported by the Sustainable Energy Authority of Ireland. While my Department was not involved in the development I am informed that, when launched in 2007, these homes were approximately 40% more efficient than they would have been if built in accordance with building standards in place at the time. The communal heating network was supplied by a central boiler originally fuelled by biomass, which significantly reduced the carbon footprint of the homes. I understand that the fuel source has since been changed to a gas boiler.
Gas prices are not capped in Ireland and the Commission for the Regulation of Utilities has no function in terms of gas price regulation. The position of successive Governments, for almost 20 years, has been that competitive energy markets result in greater choice for consumers and businesses. As a result, gas prices are set by suppliers as entirely commercial and operational matters for the individual supplier. Given recent international developments, however, the importance of moving away from our reliance on imported gas has been underpinned and we are accelerating the development of renewable energy generation across the country.
This Government recognises the potential to make use of renewable and waste energy to heat homes and businesses as part of a range of measures to reduce carbon emissions. The Climate Action Plan 2021 contains actions that will provide a solid basis for the appropriate expansion of district heating in Ireland, including the establishment of a Steering Group to oversee the rollout of district heating and ensure that a robust governance framework is put in place. These actions will also ensure consumer protection, in accordance with legislation.
Reply from Commission for Regulations of Utilities – 23rd, March 2022
Dear Deputy Nash,
Thank you for contacting the CRU and your recent correspondence to Chairperson Aoife MacEvilly.
As I have been dealing with a number of similar queries in relation to this subject, I felt it was appropriate to write to you directly to provide a response as quickly as possible.
The CRU has an important role in regulating electricity and gas markets. The CRU’s legislative remit however does not however extend to district heating networks.
We note the concerns of your constituents that the district heating provider is charged on a commercial basis rather than domestic, and as a result they are being charged commercial rates. The terms and conditions of the supply of gas to the provider of the district heating network, is agreed bilaterally between the district heating provider and their chosen gas supplier. It is likely given the size of the connection and capacity required, that the provider may not fall within a domestic supply category, and can only be supplied as commercial.
The district heating provider, as the holder of the contract with the gas supplier, can query the basis of the classification as a commercial customer by the supplier and ensure that they are being supplied on the most appropriate rate and terms.
The CRU currently has no statutory remit in relation to the heat market/heat customers. As such, our regulatory framework does not cover the relationship between the district heat provider and the end customer (residents). The CRU’s regulatory framework does cover the supply from the gas supplier to the district heating provider; the final gas customer in this instance. If, however, the supplier has appropriately classified the district heating provider as commercial and is supplying them on the basis of an agreed contract, there is unlikely to be recourse through the CRU.
We note the Climate Action Plan 2021 includes a range of actions concerning the development of the district heating sector and policy, which we envisage will include district heating regulation. The CRU is actively involved in the relevant Steering Group.
For more information, please contact:
Daragh Hamilton, Parliamentary Assistant to Ged Nash TD: firstname.lastname@example.org