Description:Since 2012, the Single Electricity Market (SEM) has been undergoing a comprehensive review in order to ensure its compatibility with the European Target Model for cross-border energy trading. The goal is to create a competitive market across Europe and link separate markets. The SEM Committee is in the middle of a consultative phase on the re-design of the electricity market, due to go live in 2017.
Implication(s):Options being considered by the SEM Committee will have long-term implications for the trading of power across interconnectors, and hence for the relative competitiveness of electricity in Ireland and Britain. The all-island SEM has encouraged new entrants to the market, new investment and increased competition. The SEM is cost reflective and encourages the use of efficient plant to meet demand – therefore variations in international gas prices have a significant impact on the wholesale price of electricity, and this is likely to continue over the course of the transitory phase to the target model. Ireland secured an extension until 2017- increased regional integration should ensure security of supply and introduce greater levels of competition. The complex nature of the proposed market design, and its real impact upon consumers, is not yet known.
Current Position:The technical complexity of this project is daunting; energy providers are fully engaged, but even the largest energy users have struggled to keep abreast of developments. Ibec continues to address this problem by means of policy briefings and workshops.
Ibec made a submission to the consultation paper outlining four options for the redesign of the wholesale electricity market. Our submission underlined the need for a Regulatory Impact Analysis (RIA), incorporating some quantitative modelling of plausible market outcomes to enable energy end-users to understand the likely impact of decision on their electricity bills.
Phone: +353 1 6051697
Last Updated: 01/18/2016