Isle of Man electricity customers facing 51% price hike
Electricity bills on the Isle of Man are set to rise by 51% on average, Manx Utilities (MU) has announced. The increase will by applied in two stages, in April and in July, following a six-month price freeze. It means an average customer’s annual bill could go up by more than £380.
MU chairman, Tim Johnston MHK, said the firm could no longer shield customers from price hikes due to volatility in the wholesale gas market.
“We are very conscious of the impact that this will have on our customers and the decision… is not one the Manx Utilities board has made lightly,” he added.
MU said it had been absorbing price changes by using £25m of reserves and saving £40m by forward purchasing gas, which is used to produce most of the island’s electricity.
But the state-owned energy provider said it was no longer sustainable to do so with a deficit of about £50m anticipated for the next financial year.
The increase will mean that a customer who lives in an two or three bedroom house, and does not use electricity to heat their home, will see their annual bill rise by more than £380.
The energy provider explained this type of household could expect an increase from £751 to £942 from April, and then to £1,133 from July. Politicians backed plans to freeze tariffs for the winter months in September and provide a £26m loan to MU, to be taken from treasury reserves.
Mr Johnston said MU had not used the loan as temporarily reducing tariffs would mean higher tariffs in the future, and a higher overall cost for customers.
“The aim has been to minimise the cost to our customers whilst ensuring Manx Utilities can continue to meet its financial obligations,” he added.
In other news – Princess of Wales meets troops on Salisbury Plain
The Princess of Wales has visited Salisbury Plain in Wiltshire to meet members of the 1st Battalion Irish Guards.
Catherine, who is Colonel of the Irish Guards, was meeting the troops for the first time since receiving the honorary appointment last year. Learn more