The benefit to consumers from the introduction of an all-island electricity market in Ireland next year will not be seen until "the medium or long term", the energy regulator said yesterday.

Regina Finn, a member of the Commission for Energy Regulation, told an Oireachtas committee that prices would ultimately be lower than they would be in the unified market than in two separate markets. However, she could not say whether prices would fall from their current levels because of fluctuations in the price of gas, which is used to generate electricity. Ms Finn was speaking at the Oireachtas Joint Committee on Communications, Marine and Natural Resources during a debate on the introduction of a statutory instrument which provides that the current trading structure will remain in place until the all-island market is created in the middle of 2007.

She said the creation of a unified market and introduction of a "gross pool" trading system would incentivise electricity generators to join the market.

Separately, the EU published a green paper on energy in which it said states should take steps to create a single European energy market and diversify energy supplies. The paper, to be discussed by EU leaders in Brussels this month, asks states to stockpile gas for times of crisis and invest more in energy infrastructure.

The commission said EU states need to invest €1 trillion over 20 years to meet rising demand. They must also boost energy efficiency and the use of renewable energy sources to combat the threats posed by global warming.

The paper also called for a new energy pact to be agreed with Russia, which supplies a quarter of EU gas. Commission president José Manuel Barroso will soon meet Russian president Vladimir Putin for talks on security of supplies.