Tynwald mandated gas tariffs suspended by court 

A later court date has provisionally been set for October 

The High Court has suspended regulation changes made to gas prices by Tynwald. 

Tynwald members unanimously and without debate passed a cut in prices for customers using more 500,000 units of gas a year at its final sitting earlier this month, doing so in little over five minutes. 

However after a court hearing before First Deemster Andrew Corlett, the Communications and Utilities Regulatory Authority and Isle of Man Energy have agreed to a three-month pause.

The regulations, brought by CURA, would see regulated commercial customers pay gas at a rate set at 1.5p less than the standard all Island central heating rate.

Moving the motion in Tynwald, Ann Corlett MHK, who sits as the political member on CURA, said IOM Energy's income from commercial sized customers 'has increased significantly in recent years, without any compelling explanation other than charging excessive tariffs'.

She added: "In summary, the amendment regulations introduce a new category of regulated commercial customer, being large commercial customers consuming, on average, 500,000 units of gas or more per year. 

"They also amend the definition of special agreement customers, so that it applies only to very large consumers using 10 million units or more per year who are subject to individually negotiated contracts. To ensure there is no confusion, these categories are solely for regulated purposes."

Opening proceedings, Deemster Corlett said the issue appeared to have been 'rushed through' Tynwald at 'enormous speed', adding it was hard to see why it was needed at the height of summer when gas usage is lower. 

Addressing Deemster Corlett, Jonathan Wild acting for IOM Energy said the company rejected claims it was overcharging.

He argued that CURA had decided to create the new category when it had no power to do so, saying that those powers actually sit with the Department of Infrastructure. 

Mr Wild said that both IOM Energy and CURA had already been treating customers using over 500,000 units a year as if they were regulated and that as the law stands, IOM Energy has no legal duty to supply to any customer who requires over 76,000 units a year. 

As a result, he said, the company is free to negotiate contracts with largescale customers, with the brewery cited by both parties as an example of this. Mr Wild said that the contracts were 'bespoke' for specific customers. 

The advocate confirmed that prior to the changes proposed, the company had been intending to lower large customer tariffs down anyway but, he argued, that doesn't mean CURA has the power to enforce it or act before it, even with a Tynwald vote. 

He added that even if the court does find it has the power to act, it doesn't mean that either the regulator or Tynwald has the power to set aside the contracts entered into by Isle of Man Energy and its customers. 

Mr Wild continued by saying that CURA had not consulted on its proposed new tariff or the impact it had could on the financial structure of the wider group. 

Oliver Helfrich, representing CURA, said the regulator had acted in the interest of customers after it identified the contested issue of pricing.

However, before he went much further into his arguments, a break was agreed upon, at the end of which the two sides had reached an agreement to suspend the regulations for three months, a move Deemster Corlett said was 'extremely sensible'. 

Mr Wild also confirmed that should the court rule against the gas supplier, it would be liable for paying back customers any extra they had been charged during the suspension period.