New index will allow consumers to track fuel and electricity prices
A NEW way of measuring energy prices in Ireland is set to become available to consumers.
The Bord Gais Energy Index will track wholesale prices for oil, coal, gas and electricity on the Irish market. These prices will then be combined into one index which will provide an overview of the global performance of the energy sector.
The index will not be an exact guide to future consumer prices -- regulation prevents prices being adjusted on a regular basis -- but it is hoped the index will simplify the pricing process and will allow consumers to follow long-term pricing trends.
According to Bord Gais, the index is aimed at both the consumer and financial professionals and will "add an informed commentary around the performance of the energy sector".
Bord Gais has set December 31, 2009, as the baseline of the index, closing that day at 100 points. It has since risen to 109. During the summer of 2008, it peaked at around 180 before falling to 80 at the height of the financial crisis that autumn.
The index will price oil and coal based on the Intercontinental Exchange price. Gas will follow Spectron pricing and electricity will be priced on the Single Electricity Market Operator system.
Each of the four sectors is weighted in line with their importance within the market (oil has by far the heaviest weighting), while peat and renewables that aren't used in electricity production are excluded. The index will be released on a monthly basis.