The arrival of a new entrant into this year's wholesale purchase of power will lead to more competitive electricity prices and improved services for customers, according to the electricity regulator.
The electricity Regulator, Tom Reeves, said the second Virtual Independent Power Producer Auction (VIPP2) was a success after it attracted the US company, Duke Energy International, to the Irish Electricity market for the first time.
It's understood that Duke Energy purchased 10% of the 600MW capacity. Bord Gáis Éireann bought another 10%. ESB Independent Energy and Viridian Energy Supply Limited bought purchasd 40% apiece. The bids were ranked and awarded at the price of the lowest successful clearing bid.
The regulator was happy that the auction was oversubscribed after last year's auction shortfall, and the recent closure of the Denis O'Brien-backed ePower, which called on Mr Reeves to resign, claiming he did not have sufficient powers to ensure proper competition.
Reeves said: 'This can only result in more competitive electricity prices and improved services for eligible customers.'
The VIPP auction provides 600 MW of capacity for independent suppliers to sell to the eligible customer market. The ESB has opened up 28% of the electricity market to competition. This works out at about 400 large industrial customers. This will increase to 40%, or 1,500 customers, in February 2002.
This capacity is used by the independent suppliers to create a market in advance 2005 when the market will be completely open. 'For a company to purchase such capacity is a signal of its commitment to the Irish electricity market,' said a spokesperson for Electricity Regulation Commission because it generally means they are going to build a power station since power generation, not power supply is where real profit lies.
Energia, a member of the Viridian Group, said it purchased its maximum possible allocation of 240 MW in capacity for onward sale to approximately 120 large enterprises throughout Ireland.
