ISME vent fury at electricity price rise

The Irish Small and Medium Enterprise (ISME) organisation has slammed the energy regulator for allowing next January's 19.6% electricity price increase.

According to ISME chief executive Mark Fielding, today’s decision demonstrates that the liberalisation of the energy market has failed and a new approach is needed to ensure security of supply at a reasonable cost.

“The ESB is in a position of strength when it comes to information and knowledge of the industry and have shown amazing alacrity in their ability to bamboozle the Commission for Energy Regulation (CER) when it comes to price rise ‘justification’,” said Fielding.

“This ‘information asymmetry’, a euphemism for being more savvy than the regulator, has disastrous cost implications for the consumer and small business in particular.

“Meanwhile, the ESB has returned super-normal profits in excess of €1.5bn in the five years of the CER’s reign, mainly on the backs of small and medium businesses.

“The CER is mandated to demand that firms increase their efficiency, not reward them for failing to do so.

“The continuous decisions to allow price increases to the ESB to recover their cost inefficiencies simply carries on the practice of a monopoly and fuels the argument that competition doesn’t work.

“At the same time, ministers are able to wash their hands of responsibility for price increases and blame it on the regulator. In fact, the CER is nothing more than a mudguard for the minister.

Fielding went on demand the deregulation of the Irish energy industry, along the lines of the British model.

“Deregulation of the electricity markets has been shown to work in other countries, notably in the UK, where electricity prices have dropped sharply,” he said.

“The Irish attempt at deregulation is doing the exact opposite, largely because of the continuing dominance of the ESB, the Government’s fear of ESB trade unions and the total absence of an alternative energy policy.”