There was also growing disquiet about the hedging contracts the ESB and others had negotiated which had tied customers here into high prices for an extended period .
Rivals Bord Gáis, SSE and Energia – the next big three in the market – are not subject to the same strictures and could in theory use their profits from generation to subsidise other parts of the business, potentially shielding their customers from price hikes on wholesale markets, mindful they have shareholders and capital investment requirements to think of as well.
This means we’re tied into UK gas prices, which hit a record £7.25 a therm, the unit in which it is measured, in August last year. In pre-Covid times, it averaged just 40-50p a therm. Since the high of last August, prices have fallen back significantly and are now trading at £1-£1.50 a therm. The culture of hedging here seems to be different from in the UK, for instance, with operators typically locking in prices for bigger volumes longer in advance. Electric Ireland is said to hedge up to half its requirement 12 to 18 months out with fixed floor prices.