The Regulatory Authorities for Energy in Ireland and Northern Ireland have announced the launch of a new electricity market for the island of Ireland. The new market, known as Single Electricity Market, combines the two separate wholesale North and South markets into one cross-border market that is more efficient and cost-effective.
The Single Electricity Market (SEM) is a ground-breaking cross-border project that involves the input and co-operation of all parties in the electricity industry – North and South.
The SEM is the first cross-border market of its kind in Europe. All electricity produced on the island will now be sold into one large ‘pool,’ while supply companies will then buy their power out of this pool. The market is specifically designed to set the cheapest possible price for electricity at all times. No one company will have an undue influence over electricity prices.
The single wholesale market introduces a new culture of co-operation in the energy field which will benefit all customers. In this regard, the SEM can be considered to be a unique and important development for the energy sector on the island. What all this means for customers is that competition will be enhanced leading to improved choice across the island and an improved price outlook than would otherwise be possible. The integration of the two markets will also improve electricity security of supply.
Tom Reeves, chairman of the CER and Iain Osborne, CEO of NIAUR, have both strongly welcomed the implementation of the SEM and have acknowledged the significant effort and co-operation across the industry in achieving this goal. Go-live of the SEM is the culmination of a number of years of cross border co-operation, as both regulators worked towards the common goal of introducing a market that would benefit customers in all parts of the island.
The regulators have now committed to continuing to work together to ensure the full advantages of the SEM are realized. Reflecting the joint nature of these new electricity trading arrangements the Commission for Energy Regulation (CER) and the Northern Ireland Authority for Utility Regulation (NIAUR) will refer all SEM Matters to a joint SEM Committee for decision. The SEM Committee, established under law in both jurisdictions, has been put in place and comprises members of both Regulatory Authorities as well as an independent member and deputy independent member.