Mutual Energy to release almost £4 million to reduce NI consumers’ electricity costs
Mutual Energy has taken the exceptional step of contributing £3.8 million from its cash reserves to reduce electricity tariffs for domestic and business customers in Northern Ireland and help ease the burden during the COVID-19 pandemic.
Mutual Energy, which owns and manages critically important gas and electricity assets including the Moyle Interconnector that links the electricity systems of NI and Scotland is a mutual organisation and does not have shareholders. Under the unique mutual model, its objective is to return savings to all NI customers over the lifetime of its assets. To do so, it usually reinvests any financial earnings into its infrastructure for the long-term benefit of energy users in Northern Ireland.
The Board decision to take the exceptional step of releasing almost £4million to help reduce electricity costs was supported by Mutual Energy’s membership and approved by the Utility Regulator. Mutual Energy’s 30 strong, diverse membership panel consists of members of the public who effectively perform the role of shareholders.
Speaking about the £3.8 million contribution, Paddy Larkin, Chief Executive of Mutual Energy said; “Given the trying and uncertain times we all find ourselves in, we wanted to do our best to lessen the burden faced by homes and businesses across the region. This initiative is a very practical demonstration of Mutual Energy’s modus operandi: ‘A Northern Ireland company working for consumers’. Following recent successful business performance and a detailed assessment of our current financial position, we are pleased to be in the position to take the unprecedented and exceptional measure of releasing £3.8 million from our cash reserves to help reduce electricity costs at this time.”
“As a mutual company, we do things differently and our governance model is unique in the energy industry. At our core, our ethos is to return any savings we can generate to consumers while still prudently managing business risk and this extraordinary measure reflects the extraordinary times we are all now living in. We have worked closely with the Utility Regulator to find the best mechanism to deliver this saving and we have agreed that it will be passed through the tariff system as a general reduction in the 2020/21 tariff year starting in October. While we understand that the impact to individual customers will be quite modest, the contribution in the context of Mutual Energy is significant and equates to approximately one third of our annual profit.”
Welcoming the announcement, Jenny Pyper, Chief Executive of the Utility Regulator said; “The Covid-19 pandemic has bought extra uncertainty and concern for consumers about their ability to pay bills. We have been working with a range of utilities to help consumers practically during this time. This contribution from Mutual Energy is another example of local utility companies stepping up to support consumers at this difficult time by putting some money back in their pockets.”