The creation of a groundbreaking single electricity market for the island of Ireland is being delayed for four months, it was announced today.
The scheduled ‘go-live’ date of July 1 2007 has been put back to November 1 to make sure there are no last minute hitches.
The announcement was made by Northern Ireland Secretary Peter Hain and Noel Dempsey, Minister for Communications Marine and Natural Resources following a recommendation by the regulators on both sides of the border after a review of progress towards the single market.
They said the delay would allow extensive market testing and implementation to run from June to November 2007.
Mr Hain said the single market was a groundbreaking arrangement between the North and the Republic of Ireland that would create a single wholesale electricity market across the two jurisdictions.
“The new Single Electricity Market (SEM) is the first of its kind in the European Union and will be a flagship development in the European drive towards a common energy market,” he said.
Mr Hain added: “It is essential that we get it absolutely right. We need to give the regulators , the transmission system operators and industry time to finalise the design and implement the market so that it delivers key benefits to customers and to both economies.”
He said the SEM would enlarge the electricity market across the island of Ireland and improve the security of supply in a difficult international energy climate – and ultimately deliver the best solution for customers across the island.
Mr Dempsey added: “Both governments remain committed to delivering the necessary legislation in advance of July 2007 to underpin implementation of the new market in the run up to day one.”
He said he and northern Enterprise Minister Maria Eagle were pleased the regulatory authorities had confirmed the project was progressing successfully.
They were confident it would deliver wholesale market arrangements that best served the whole island and electricity customers now and in the longer term, he added.
“To ensure this, we have agreed that SEM benefits can best be maximised by building into the project plan some additional time for project assurance, impact analysis and market trials,” said Mr Dempsey.
“This extra time will ensure that the challenges associated with the implementation of these complex arrangements are fully addressed for all parties including most importantly customers and market participants,” he added.
The ministers announcement of the delay came just seven weeks after they stood side by side at an energy conference and committed themselves to the July 2007 date.
As they did so the two energy regulators were meeting in a nearby room drawing up plans for the delay.
Energy company Viridian – parent of Northern Ireland Electricity – said it was disappointed by today's announcement.
Spokesman Robin Greer said: “Viridian Group is totally committed to the introduction of the all island market at the earliest possible date and any delay in the introduction of the new market is unwelcome.”
Properly implemented the all-island market had the potential to bring significant benefits to consumers, he said.
“While it is regrettable that the July 2007 date will not be met, we recognise that a short delay may be unavoidable to ensure that the details of the market design are correct.
“However the project must be completed as soon as possible as a lengthy delay will add to the development costs and undermine the confidence of the industry and customers.”