Consumer Council says gas prices should not rise until customers have been compensated for last October's island-wide outage.
Bills will increase by 12% in Jersey, adding £14 a month to an average household's outgoings.
Carl Walker, head of the Consumer Council, says the company has to get its priorities straight.
"It just shows you that they've managed to work out how much bills need to go up rather than address that first issue of compensating people for the days and weeks they went without gas.
I know different people have different gas uses in their property, and it might be tricky to work out, but the standing charge should be a simple calculation.
We know that people's bills haven't been reduced by the number of days they were cut, and they should be able to do that with a flip of a switch and work out the more detailed compensation down the line."
A 'rogue code' caused the plant at La Collette to shut off in October, meaning thousands of homes were left without heating or hot water, some for several weeks.
It also forced some businesses to close.
Carl says the announcement has raised questions about Island Energy's intent.
"The fact that Jersey is going to see a 12% increase compared to 8% in our sister island of Guernsey.
Some might say that Island Energy is trying to make more money out of this island to recover any compensation it's going to have to pay out further down the line.
IE needs to pull its finger out and release the details of this compensation scheme rather than asking islanders to start paying more for its service."
He also says there will be a tipping point for the island's gas network soon as people discuss disconnecting their supplies.
"It will no longer be visible for Island Energy to supply the island with gas as more and more islanders walk away from the service, many in disgust of the way they've been treated.
It's time for the government and other organisations to discuss what they will do when that happens because the natural switch is to electricity, but there is no way Jersey Electricity could supply thousands of new customers all in one day or week."
We have asked Island Energy for comment.
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