Government and Manx Gas failing to agree detail of new deal

Sides split on detail of terms agreed in November

Manx Gas customers are still paying higher prices as the energy company and government have so far failed to sign off a new regulatory deal.

It was approved by Tynwald in November to replace the 2015 agreement, but the two sides are still split on the detail.

Campaigners breathed a sigh of relief when Tynwald approved the terms of a new deal with Manx Gas.

After what were described as tough negotiations with the Cabinet Office, the energy company agreed to a £93 rebate on 2020 bills, with the same reduction in tariffs for 2021.

The return on capital for Manx Gas will reduce to 6.99 per cent down from the near 10 per cent in the widely criticised 2015 deal. 

But the company has raised repeated concerns about who would regulate the deal, and oversee determination of tariffs

It had been agreed that the Communication Commission, with the snappy new title the Communications and Utilities Regulatory Authority, would take on this role.

The board's membership was changed to remove a political chair and replace it with a non-voting political member, but Manx Gas still wanted reassurance it would be independent.

It's understood this is a hang up for the company, which only submitted financial information for review on 22 December.

Government says this has had a significant impact on the ability to reach consensus, whereas Manx Gas says it's frustrated with a lack of progress.

A spokesperson for the energy company, owned by Ancala Partners, says the draft contract was first recieved on 4 December, and was returned with comments on 14th of the month.

Manx Gas has not recieved a response to those comments 'in over a month' it says.

It's urging government to agree to the full contract, 'to allow customers to benefit from the new lower prices for 2021 and refund for 2020.'

Tynwald gave the two sides until the end of last year to finalise the deal, so it remains to be seen whether they'll need to be given a fresh mandate to reach an agreement.