Manx Gas says that the consultants commissioned by the government made ‘several significant mistakes’ which affected the findings.

In a response contained as a an appendix in the Chief Minister’s committee report, it said that the consultants had ‘cherry picked’ parameters used in calculations and ignored Isle of Man-specific factors.

The utility had also made its own proposal for a new regulatory mechanism, which it has called MUA-plus.

This features a modified price cap with future tariffs varying in line with CPI-inflation.

Managing director Ian Plenderleith (pictured) said: ‘We believe this will be a positive step forward.’

He said: ‘The government recognises we fully complied with the terms and conditions of the regulatory mechanism in place at the time.

‘We recognise that the government says the rate of return should be significantly lower and we are looking forward to discuss what it should be.

‘In order to invest in the network it is important to ourselves that the correct rate of return is set.

‘We would have been able to claim a higher amount than in the spirit of the agreement we actually did.’