Regulator lifts ESB price restrictions. Is this an outcome of the election

Lawrence1895

I'm just reading, that the regulator won't put any more restrictions on ESB's prices from April 4th on. Seems like, ESB are some kind of privatized already.

Lovely, they can charge whatever they want?

And might this be seen as an outcome of the election, because FG wanted to privatize certain semi state bodies?

I guess, Bord Gais might follow very soon :mad:

http://www.rte.ie/news/2011/0304/esb-business.html

Paparazzo

It's purely because their percentage in the market has dropped below a certain point.

Lawrence1895

Paparazzo wrote: »

It's purely because their percentage in the market has dropped below a certain point.

And do you really think, they will put down their prices in order to compensate for their losses? I doubt it

Paparazzo

Lars1916 wrote: »

And do you really think, they will put down their prices in order to compensate for their losses? I doubt it

Of course, they have to. Do you think they'll raise prices and lose more customers? Or leave them the same? They have to get customers back.

They should drop their prices way down and get a monopoly back again

compsys

Lars1916 wrote: »

And do you really think, they will put down their prices in order to compensate for their losses? I doubt it

Yes actually. ESB has been rapidly losing market share to Bord Gáis and Airtricity over the past year because it was forbidden from reducing prices as it was deemed to hold a dominant position in the market.


ESB cleared to slash electricity prices
Friday, March 04 13:39:09
A free for all in electricity prices is set to begin next month, following the announcement today of the full deregulation of the market.
The decision by the regulator CER means that that the ESB, trading under a new name, will be able set its own prices for domestic customers.
It is expected to launch new lower price tariffs to compete with suppliers such as Airtricity and Bord Gais, who have been selling electricity at prices well below those of the ESB.
CER said today: "This price deregulation decision will enable Electric Ireland, which is the new name for ESB supply activities, to set its own electricity prices for domestic customers from 4th April this year, without prior CER approval. It follows a similar decision by CER to deregulate prices for business customers from last October."
Until now, ESB has not been allowed to set its own prices for domestic customers. Because it was seen as the dominant supplier in the market, its prices were fixed by the regulator.
However, with large numbers of people having switched to other suppliers, it is no longer regarded as the dominant supplier, allowing the market to be fully freed.
Electricity Ireland is expected to not only reduce domestic electricity prices, but to offer low cost gas supplies as well, thus replicated what Bord Gais has already been doing.

Lawrence1895

compsys wrote: »

Yes actually. ESB has been rapidly losing market share to Bord Gáis and Airtricity over the past year because it was forbidden from reducing prices as it was deemed to hold a dominant position in the market.


ESB cleared to slash electricity prices
Friday, March 04 13:39:09
A free for all in electricity prices is set to begin next month, following the announcement today of the full deregulation of the market.
The decision by the regulator CER means that that the ESB, trading under a new name, will be able set its own prices for domestic customers.
It is expected to launch new lower price tariffs to compete with suppliers such as Airtricity and Bord Gais, who have been selling electricity at prices well below those of the ESB.
CER said today: "This price deregulation decision will enable Electric Ireland, which is the new name for ESB supply activities, to set its own electricity prices for domestic customers from 4th April this year, without prior CER approval. It follows a similar decision by CER to deregulate prices for business customers from last October."
Until now, ESB has not been allowed to set its own prices for domestic customers. Because it was seen as the dominant supplier in the market, its prices were fixed by the regulator.
However, with large numbers of people having switched to other suppliers, it is no longer regarded as the dominant supplier, allowing the market to be fully freed.
Electricity Ireland is expected to not only reduce domestic electricity prices, but to offer low cost gas supplies as well, thus replicated what Bord Gais has already been doing.

Sounds interesting. I never expected that, since I made more negative experiences with companies like ESB in Germany.

May I ask, where you got this information from? The CER website?

MASTER...of the bra

The same regulator made ESB put up their prices so that Airtricity and Bord Gais could enter the market charging what ESB was. 2011 and we are only now going to get a bit of competition:(.

2012 and it'l be like England where all the suppliers put their prices up within days of each other.

matrim

Lars1916 wrote: »

I'm just reading, that the regulator won't put any more restrictions on ESB's prices from April 4th on. Seems like, ESB are some kind of privatized already.

Lovely, they can charge whatever they want?

And might this be seen as an outcome of the election, because FG wanted to privatize certain semi state bodies?

I guess, Bord Gais might follow very soon :mad:

http://www.rte.ie/news/2011/0304/esb-business.html

Nothing to do with the election and was on the cards for a while. I think the 2 main factors to allow it were that ESB get below a certain % share of the market and rebrand to Eletric Ireland before they could set their own prices.

Lawrence1895

MASTER...of the bra wrote: »

The same regulator made ESB put up their prices so that Airtricity and Bord Gais could enter the market charging what ESB was. 2011 and we are only now going to get a bit of competition:(.

2012 and it'l be like England where all the suppliers put their prices up within days of each other.

Or like a decade ago in Germany. The market is privatized, companies put prices down for a short while. And as soon as enough new customers have signed a contract, they will impose a huge price hike. And the government won't do anything to stop them. Capitalism at it's best :mad:

slimjimmc

I guess this means that the discounts offered by BG can be decoupled from ESB now that the market is fully deregulated. Instead of getting 10% of ESB's price you'll be getting 10% off BG's standard rate for the first year of contract. If the price quoted on BG's website is the discounted price (cross-references to first yr savings make me think this is the case) not the standard rate then I expect B&G customers could soon see an increase or decrease in their bills, depending on where BG pitch their standard rate.

http://www.bordgaisenergy.ie/home/electricity/join/

* The discount stated is off the applicable ESB Customer Supply regulated domestic tariff unit rate until deregulation. Thereafter the discount is off the Bord Gáis Energy residential tariff unit rate. The discount is applicable for a total of one year. Terms and conditions apply.

ytpe2r5bxkn0c1

Lars, no offence intended but you don't seem to have aclue about the regulated market here. Go to the CER site and read up on it. This change will now allow ESB compete for the first time - hardly a cause to raise prices.

Also you refer to them compensating for their losses. They make profits.

Lawrence1895

Judson Dead Plywood wrote: »

Lars, no offence intended but you don't seem to have aclue about the regulated market here. Go to the CER site and read up on it. This change will now allow ESB compete for the first time - hardly a cause to raise prices.

Also you refer to them compensating for their losses. They make profits.

No worries, it needs a lot more to offend me

The reason for my post was, that I feared, ESB and other energy suppliers would, after being privatized, impose a prize hike, whenever the country is out of the worst.
I admit though, that competition can lead to lower prizes as well.

ytpe2r5bxkn0c1

Lars1916 wrote: »

No worries, it needs a lot more to offend me

The reason for my post was, that I feared, ESB and other energy suppliers would, after being privatized, impose a prize hike, whenever the country is out of the worst.
I admit though, that competition can lead to lower prizes as well.

Oh just for clarity: this deregulation is not privatisation.

slave1

Lars1916 wrote: »

as soon as enough new customers have signed a contract, they will impose a huge price hike. And the government won't do anything to stop them. Capitalism at it's best :mad:

If the ESB raise their prices then you can simply leave and seek an alternative supplier, you seriously don't think they can sell one rate to you, get you to sign a contract and hike the price and not allow you to leave contract gratis.

discostu1

If the ESB raise their prices then you can simply leave and seek an alternative supplier, you seriously don't think they can sell one rate to you, get you to sign a contract and hike the price and not allow you to leave contract gratis.

Absolutely agree but I know that Airtricity have a clause in some of their one year contracts that if you leave you pay them a breakage fee. So if for example ESB or BGE came out with a SUPER offer (Unlikely I know)and you decided to move from Airtricity but you had a contract with a breakage fee you would be penalised. THe interesting question will be will ESB be competitive and will they have contracts for domestic customers!!!

watty

We had cheaper electricity before the "Regulator" decided to put up Retail prices to "encourage" Competition to help consumer.

Airtricity and Bord Gais are Regulator created vampires. It's inefficient and doctrinaire and doesn't help the Industry or Consumer.

keithclancy

watty wrote: »

We had cheaper electricity before the "Regulator" decided to put up Retail prices to "encourage" Competition to help consumer.

Airtricity and Bord Gais are Regulator created vampires. It's inefficient and doctrinaire and doesn't help the Industry or Consumer.

AFAIK I believe they just were trying not to have a repeat of Eircom.

Max Power1

discostu1 wrote: »

Absolutely agree but I know that Airtricity have a clause in some of their one year contracts that if you leave you pay them a breakage fee. So if for example ESB or BGE came out with a SUPER offer (Unlikely I know)and you decided to move from Airtricity but you had a contract with a breakage fee you would be penalised. THe interesting question will be will ESB be competitive and will they have contracts for domestic customers!!!

Yes, and no IMHO

ytpe2r5bxkn0c1

keithclancy wrote: »

AFAIK I believe they just were trying not to have a repeat of Eircom.

The problem with Eircom was privatisation. This issue is about de-regulation. A totally different subject.