Natural gas users on the Island face a swinging rise in gas prices.
The increase announced on Thursday, a combination of basic tariff and fuel adjustment, comes close to the 14.5% increase due to come in electricity prices in a fortnight.

Consumers in Douglas, Onchan, Union Mills and Glen Vine, the bulk of the companies customers, face an overall rise of between 8% and 12 %.

There is one small crumb of comfort. The company has guaranteed no further increases for natural gas customers until at least 1 July 2007.

The company explains the rise in these terms.
"We will be levying a fuel cost adjustment of 0.485 pence per unit for natural gas customers. The fuel cost adjustment reflects the unprecedented high purchase costs being seen in the natural gas industry. The fuel cost adjustment equates to between 5.3% and 9.2% for domestic customers depending on their tariff. When this is combined with the base tariff increase it gives an overall rise of between 7.8% and 11.9%".

Managing director Alan Bates says Manx Gas have kept the underlying tariff increase of 2.5% to a figure below inflation and that had been achieved by actively controlling costs.
He says that the rise in tariffs is required to cover general increases in operational costs over the past 12 months.

In a statement, Mr Bates says " We are very aware of the impact gas price increases have on our customers. World events and the wholesale gas market are beyond our control and we believe it is in the best interests of our customers to buy forward the majority of our product to protect them from further increases and the unprecedented volatility seen last winter. Natural gas retailers in both the UK and Ireland have recently increased their prices by much higher levels ranging from 15–33%. Manx Gas has taken a conservative view such that it has secured most of the winter’s natural gas at a realistic price and is now able to provide its natural gas customers with the security that the price will be fixed until at least July next year. We are continuing with our efforts to put similar arrangements in place for our LPG requirements in order to give the security of fixed prices for our LPG customers.”

The firm says the wholesale price of natural gas is now 80% higher than a year ago and has more than tripled since 2003. LPG prices have also been driven higher by the record oil costs.
They add that Manx Gas remain committed to reducing the fuel cost adjustment should energy prices fall back to lower levels.
The stated increases have been discussed with the Office of Fair Trading.