Airtricity to compete with ESB in selling power and gas to households

WIND POWER group Airtricity and its owner, Scottish Southern Energy (SSE), are set to take on two State companies by entering the Irish gas and domestic electricity markets.

Airtricity Supply announced yesterday that it intends to begin offering power to the Republic's 1.7 million households, where it will be competing with the only existing player, State-owned ESB.

The company already supplies electricity to industrial and commercial customers, but along with all other independent players, has avoided the domestic market because it did not have the structures needed to deal with large numbers of small-scale users.

But SSE, which bought the company for €1 billion in January, is a big player in the UK domestic market, and the customer information systems and other structures needed to supply homeowners.

Airtricity Supply chief executive Kevin Greenhorn said yesterday that it intends launching its domestic service this month.

Alongside this, it is also entering the gas market, and believes it will sign up its first commercial users to this service in the autumn, and follow this with household users early next year.

Its move into the natural gas market will see it taking on Bord Gáis, the State-owned supplier and distributor of the fuel. Bord Gáis also has its own plans to enter the domestic electricity market.

Airtricity said yesterday that it intends to become Ireland's biggest independent energy company by 2013, with 500,000 customers.

It will use the same model as SSE in Britain, where it is a "dual-fuel" supplier - it sells both gas and electricity to the same customers.

This model is common in Europe. The State's Commission for Energy Regulation (CER) is keen to encourage companies in the sector to adopt the same approach here where possible. Bord Gáis will also promote itself as a dual-fuel supplier.

Airtricity already produces electricity here from a series of wind farms. SSE said it has no immediate plans to build conventional power plants in Ireland.

It will supply the power from its own resources and buy any extra it needs on the open market, which has been operating in Ireland since last November.

Mr Greenhorn said that the launch of the open electricity market in this country was one of the factors that prompted Airtricity to begin competing for domestic customers.

It will use ESB's distribution and supply networks to dispatch power to customers. It already uses this system to get electricity to its commercial users.

It will buy gas on the open market. SSE is already a large purchaser of the fuel on world markets.

On pricing, Mr Greenhorn said Airtricity would be as competitive as possible. "There will be times when we will be cheaper than our competitors, but there will also be times when we're not," he said.