The ESB plans to apply for a licence to supply electricity to the top 230 companies in Northern Ireland, The Irish Times has learned.
The Northern Ireland market is being liberalised and any company can supply 26 per cent of the market (which translates into 230 companies) once the regulator, Ofreg, agrees new licence regulations.
While the ESB refused to comment, sources confirmed that it had held several meetings with Ofreg to discuss applying for a "private electricity licence". The company is understood to be close to submitting an application.
The 230 companies would represent a lucrative income source for the ESB which wants to expand into other markets.
The licence does not apply to generating electricity and would only allow the ESB to supply customers using an average of 2.5 gigawatts of power a year.
If the ESB succeeds, it would take customers from Northern Ireland Electricity, whose parent, Viridian, is currently trying to enter the market in the Republic.
Under the regulations, the ESB could supply electricity to eligible customers from any source, including its generating stations in the Republic. It also has a 15 per cent share in a generating station in Derry - Coolkeeragh - and this may be used to source some of the supply. The ESB is in talks to increase its stake in Coolkeeragh, most likely to 40 per cent.
The electricity could be transported to Northern Ireland via the north-south interconnector, although the ESB would then have to pay NIE for use of its distribution network.
Several companies already hold supply licences in Northern Ireland - including Easter Electricity, Northern Electric, Manweb (a subsidiary of Scottish Power) and PowerGen. At present, generators in Northern Ireland do not sell their electricity directly to customers, but sell it to NIE. When the new regime comes into effect generators will be able to supply customers directly.
While there is no deadline for licence applications, sources in the Northern electricity market estimate that by September some 10 companies will be seeking to supply the 26 per cent of the market.
Meanwhile, the Committee of Public Enterprise and Transport met yesterday to discuss the provisions of the Electricity Regulation Bill which liberalises the electricity market in the Republic. Amendments have been tabled by the Opposition and the Government.
Section 13 of the Bill is particularly contentious, with Viridian warning that it will take legal action if the draft becomes law. It claims the Bill does not properly translate the EU liberalising directive into law and unfairly favours the ESB.
The Minister for Public Enterprise, Ms O'Rourke, has circulated a complex amendment to Section 13, but it is not clear what effect this will have. Viridian is understood to be examining Ms O'Rourke's amendment. The committee meets again shortly.
