Barry Cowen
Question:365. Deputy Barry Cowen asked the Minister for Communications, Energy and Natural Resources his plans to promote smaller players in the electricity market; and if he will make a statement on the matter. [54267/13]
View answerTuesday, 17 December 2013
Questions (365)
Written answers
The regulation of the electricity and gas market is the responsibility of the Commission for Energy Regulation (CER). The Electricity Regulation Act 1999 provided for the establishment of the CER as an independent statutory regulator. On 1 November 2007 the Single Electricity Market (SEM) went live, commencing the trading of wholesale electricity in Ireland and Northern Ireland on an All-Island basis. The SEM consists of a gross mandatory pool market, into which all electricity generated on or imported onto the island of Ireland must be sold, and from which all wholesale electricity for consumption or export from the island of Ireland must be purchased.
Regarding smaller players entering the electricity generation market, in order to be built and/or to operate, a generation project must hold an Authorisation to Construct or Reconstruct a Generating Station and/or a Licence to Generate Electricity. The CER is responsible for assessing and for granting or refusing to grant these licences. The conditions imposed in the Authorisation and in the Licence to Generate must be met by the generator and compliance is monitored by the CER on an ongoing basis. Under Regulation 13 of Statutory Instrument No. 60 of 2005, the CER authorises, by way of order, the construction or reconstruction of generating stations with installed capacities not exceeding 2 MW. The approval process is based on the assessment of specific information submitted by the applicant that is less than that required under the full application process and takes into account their limited size and potential impact.
I am mindful of the importance of well-functioning energy markets for business and domestic customers. The Government remains firmly committed to increasing competition as the best means of exerting downward pressure on prices in electricity and gas markets. New players have moved into electricity generation since 1996. I welcome the entry of new players and increased competition.
In the electricity supply markets, the CER has overseen the gradual liberalisation of the electricity supply market which culminated in full market opening in February 2005. The regulatory framework created the appropriate environment for competition to develop and since then competition has increased in the business and domestic markets. In 2010, the CER published its Roadmap to Deregulation, which set out the milestones for the end of price regulation. All business markets were deregulated from 1 October 2010. From April 2011, the domestic (residential) market was deregulated and so all suppliers are free to set their own tariffs. The liberalisation of the electricity supply markets has seen the entry of companies such as SSE/Airtricity, BG Energy, Vayu, Energia, Endesa, PrePay Power and Pinergy. These companies offer competition to Electric Ireland, the supply arm of the ESB.