The cost of electricity is being reduced by an average of 6.1% from today to coincide with the start of a single electricity market on the island of Ireland.
The Commission for Energy Regulation estimates that the reduction in charges will save residential customers an average of €50 a year.
The Commission also estimates that the new single electricity market will deliver net benefits worth €127m to consumers over the next ten years.
The reduction in the cost of electricity for Irish consumers was ordered by the Commission for Energy Regulation as a result of falling gas prices earlier this year.
Gas is used to generate a high proportion of our electricity so when it became cheaper to buy in the gas, the regulator insisted that the reduction - averaging 6.1% - was passed on to consumers.
Residential customers will see their bills fall by 5.4%, small businesses by 5.9%, and medium sized businesses by as much as 10% from today.
The reductions coincide with the creation of a new single electricity market which begins operating also from today.
The Republic's system operator Eirgrid and its Northern counterpart SONI will be responsible for operating the market.
Electricity will now be bought and sold through a pool system, in which electricity generators will compete to provide power on the basis of bids submitted to the operator every half-hour.
ESB welcomed the new market, saying it would benefit customers and attract investment to the sector.
'We are going to see downward pressure on prices,' said chief executive Padraig McManus.
It is estimated that the creation of the new single market will result in net social social benefits of €155m over a ten year period, with €127m of those gains going to consumers.
