Domestic market electrified as Airtricity also takes on ESB

WIND ENERGY group Airtricity confirmed yesterday that it is offering householders electricity, making it the second rival to the ESB to show its hand this week.

State-owned Bord Gáis formally launched itself on the domestic electricity market yesterday, saying it will offer customers discounts of between 10 per cent and 14 per cent to the regulated price which the ESB is obliged to pay.

Scottish Southern Energy-owned Airtricity told The Irish Timesyesterday that it recently began offering electricity to householders, and is offering savings of 10 per cent to these customers.

This means that the ESB is facing competition on two fronts in the domestic market. Up to this year, it was the sole supplier to the Republic’s residential market.

Bord Gáis and Airtricity will offer both electricity and gas to consumers, making them “dual fuel” suppliers, an approach that is common in Europe, but has yet to be taken here.

The Government and the power market watchdog, the Commission for Energy Regulation (CER), want to see competition and a shift to dual fuel operators.

While the market to supply power to the Republic’s 1.7 million homes has been open to competition since February 2005, nobody seriously challenged the ESB before this year.

Most of the independent operators argued that setting up the customer service structures needed to supply households with electricity was too expensive, and therefore stayed out of the market and concentrated on the more lucrative commercial and industrial customers.

Bord Gáis has been planning for some time to enter the domestic market, and a high-profile marketing campaign, featuring RTÉ’s Lucy Kennedy, will support yesterday’s launch.

The State company is building its own power plant in Whitegate, Co Cork, at a cost of more than €400 million. This will have the capacity to supply 400,000 homes with electricity.

The company is planning to buy wind farms and is building four small generating plants with a private-sector partner, Mountside Properties.

It buys electricity on the open market and from Britain, which is connected into the Irish power grids via a link that runs between Co Antrim and the Scottish coast.

Airtricity signalled last summer that it intended entering the domestic market. It is the biggest player in green energy in Ireland and Britain, but also buys the electricity that it supplies to Irish customers on the open market.