ELECTRICITY prices are unlikely to rise ‘significantly’ for at least the next 18 months despite ‘absolute turmoil’ in the European energy market, according to Jersey Electricity.
The firm increased prices by 5% last month, with a further 5% rise planned for January – but the utility company said that households were likely to be shielded from the huge price hikes seen in the UK.
Chris Ambler, the organisation’s chief executive, said: ‘Ostensibly we are sheltering customers from the very volatile prices we are seeing in Europe and the UK. I think it’s going to be very challenging this winter in the UK.
‘There could even be rolling blackouts in Europe and the UK. It’s substantially driven by Putin’s invasion of Ukraine, and Europe importing 40% of its natural gas from Russia.’
Mr Ambler also said it was too soon to predict prices in the global energy market going into 2024, but added that long-term contracts the company had negotiated 18 months in advance meant the cost of electricity in the Island was unlikely to rise ‘significantly’ and was expected to remain at about half of that charged in the UK.
Customers in the UK have faced significant rises in their energy bills, with some expected to soar by up to 80% over the course of this year.
The relentless increase in energy costs is one of the main drivers behind the sharp rise in inflation, which recently hit 10.1% in the UK.
The Island is also grappling with its own cost-of-living crisis, with inflation rising to 7.9% recently and further increases predicted.
Meanwhile, Jersey customers also faced a 13.2% total increase in their gas bills from last October, with Jersey Gas blaming ‘significant increases in the cost of all forms of wholesale gas currently being experienced across the world’.
Discussing electricity costs, Mr Ambler said: ‘We’re in a very good place. We’ve done a lot of work to negotiate a very strong contract which involves constantly looking ahead, seeking to manage risk, fixing some prices in advance, estimating how much energy we will need and how much we forecast prices will need to rise.
‘These protective measures are limiting the price rises ahead and protecting our consumers during this extraordinary time when global and European energy markets are in absolute turmoil.’
Jersey imports 95% of its electricity from Electricité de France – EDF – using three underwater cables, with none of the energy sourced from Russia. The electricity supplied to Jersey is almost completely carbon neutral, with two-thirds coming from nuclear power and a third from renewables.
Mr Ambler added: ‘Our primary intention is to move all of Jersey from oil and gas to electric and in the long term the Island should be seeking to be more energy independent.
‘But we’ll still be reliant on imported electricity for the foreseeable future.
‘As an ambition we should be seeking to diversify our sources of energy. We’re looking at three sources of renewables – wind, tidal and solar. The most viable of all three technologies is wind at the moment.’
Jersey Electricity is encouraging customers to reduce their energy consumption by tracking their daily use on their smart phone app, unplugging appliances rather than leaving them on standby and shaving 10% off their bill by turning their thermostat down by one degree.
They are also encouraged to telephone the company for further advice, should they need it, about how to save power.