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Island Energy could be forced to shell out over £175,000 to compensate customers impacted by last October’s gas outage – at a time when its Jersey arm is already struggling, with newly released accounts showing a pre-tax loss of £5.4m last year.
Jersey Consumer Council has written a formal ‘letter of claim’ to the island’s gas provider setting out how much it thinks customers should be compensated for the outage.
JCC wants IEG to, as a minimum, match the compensation offered in the UK – which is at least £60 for every 24 hours a customer is without gas.
In its ‘letter of claim’, the JCC sets out the amount of money it thinks IEG should pay out. The minimum total is £176,400, which would compensate the 420 customers JCC is representing for being without gas for seven days.
The consumer council calculates that the “maximum initial exposure” IEG faces is £529,200, if all 420 customers were without power for three weeks. The council says it is still compiling data on the scale and timing of the outage.
JCC Chair Carl Walker said: “This is the latest correspondence in our battle to get a better deal for the consumer.
“We stand by the fact that the compensation offered is an insult to consumers, some of whom spent up to five weeks without the ability to cook, have a hot shower or heat their homes.
“We accept that legal proceedings can take time but we will not give up our fight.
“All we are seeking is for people to be treated fairly; we are not being unreasonable. I hope that this can be resolved in a sensible and amicable way before it reaches a courtroom.”
The JCC’s latest letter to IEG says that the council is “amenable to a meeting with a view to exploring settlement”.
However, it adds: “We would prefer to first receive an admission of liability and a revised offer of compensation for the consumers the JCC represent prior to any such meeting taking place so as to ensure that any such meeting has a firm position from which negotiations can move forward rather than such a meeting potentially otherwise simply being used as a tactic to delay matters without any substantive progress ultimately being able to be achieved from the same.”
The JCC ask IEG to respond within 14 days.
A company spokesperson told Express: "We apologised to our gas customers for the disruption to the supply in October 2023 and refunded them with the equivalent to one month’s standing charge following the outage. We are focused on continuing to deliver our energy services to customers on the Island.”
IEG’s latest accounts for Jersey show that, in the year to 31 December 2023, the once-called Jersey Gas made a pre-tax loss of £5.4m and had net liabilities of £3.5m.
Under a paragraph heading called ‘contingent liabilities’, the accounts reference the explosion at Haut du Mont flats in December 2022.
They state: “As the investigation is still ongoing and no finding[s] have been published, the Company is not in a position to provide an evaluation of the likelihood of any potential unfavourable outcomes or estimate of the amount or range of potential related losses.”
They add: “However, the Company does have a comprehensive programme of insurance cover in place and the various insurers have been formally notified of the incident.”
Commenting on the latest accounts, IEG said: "The 2023 published accounts are only part of our gas operations on the Island and do not include the results of our other subsidiaries.
"That period saw a world-wide commodity crisis which saw the market price for gas increase by over 200%. Jersey Gas Company absorbed the significant majority of this extra cost to help protect our customers during a cost-of-living crisis, only increasing tariffs by 5%. We also continued to invest in upgrading our network."
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