The EU directive concerning the Internal Market in electricity came into force on 19 February 1997. It must be implemented by February 2000.
It requires that approximately 28 per cent of the Irish electricity market be opened to competition at that time, increasing to 32 per cent by 2003. This will allow independent electricity generators to contract directly with eligible customers for the supply of electricity. Eligible customers will be those who will be free to choose their electricity supplier in the competitive market.
Customers consuming more than 100 giga watt hours — GWh — per year, which represents about 8 per cent of electricity sold, are automatically eligible. The remaining 20 per cent is likely to comprise customers consuming more than 4GWh per year. The majority of customers, which were known as the captive market when I took office and are now known as the franchise market, will continue to be supplied exclusively by the ESB.
The directive provides for new generation to be acquired by tendering or by authorisation. The proposals I published on 15 May last, which were circulated to the main spokespersons, set out the manner in which it is intended the directive will be implemented. It is proposed that firms wishing to establish generating stations here would be authorised, that is, granted a licence by the regulatory authority.
The proposed legislation to implement the EU electricity directive enables me as the Minister to issue the first licences required to initiate the new arrangements for the electricity industry. These will be licences issued to the ESB to generate, transmit, distribute and supply electricity. Any other undertaking operating or ready to commence the generation or supply of electricity at the time of vesting of the new arrangements will also be licensed. Thereafter, all licences will be issued by the regulatory authority.