New regulation proposals for Manx Gas approved by Tynwald

The new agreement is expected to be signed before 31 December

Plans for a new regulatory agreement between the Isle of Man government and Manx Gas have been approved.

The deal will see the firm separated into two parts - a regulated part for households and businesses using less than 12,000KW a year and an unregulated part for those with a larger usage.

Profits for the regulated part of the company will be capped at 6.99%.

The agreement will be backdated to 1 January 2020, resulting in a rebate to customers and a reduction in tariffs.

'Right thing to do'

Policy and Reform Minister Ray Harmer told Tynwald the deal represented "the best negotiated position" to which the company would voluntarily agree.

The approval was an "important gateway on the journey towards an agreement", he added.

Claire Christian MHK criticised the proposed regulatory regime for not extending to all businesses, adding that all firms should be treated "reasonably and fairly".

Rejecting that, Lawrie Hooper MHK said the proposed deal was "on the balance... the right thing to do for now", while broader economic regulation was worked up.

Tynwald members approved the proposals and a final legally-binding agreement is expected to be completed by the end of the year.

The current voluntary agreement, which was signed in 2015, sparked public protests on the island.

A review published in February 2019 found the company's profits, currently capped at 9.99%, were too high.

In October, Manx Gas said the plans would see customers receive an average refund of £93.

Welcoming the approval of the head of terms document, managing director David Cruddace said refunds would be processed "as quickly as possible" once the final agreement was signed.