The UK government has warned that action is needed to prevent the ESB from abusing its market power when an all-island market is set up next year.
In a recent debate about the all-island arrangements in the House of Commons, David Hanson, minister of state at the Northern Ireland office, warned that the ESB's market position would be a key factor in the new market.
He said ESB would have almost 60 per cent share of generating capacity in the new market and this needed to be given serious serious consideration.
"We need to consider how to prevent ESB from abusing its market power. The dominance of ESB is a challenge to the operation of the new markets, and the Irish Government too is considering the position of ESB in their review of the Irish electricity sector," he said.
He said the UK Department for Enterprise, Trade and Investment had taken a close interest in the matter and the issue would be considered at a political level.
The comments from the minister will increase the pressure on the Minister for Communications Noel Dempsey who is considering the position of the ESB at present.
Mr Dempsey has a copy of a report by Deloitte about the energy market.
It recommends widespread changes and the sell-off of some ESB plants. The ESB currently owns 19 power stations. It also has a wind energy arm and a networks business.
Mr Dempsey has committed to publishing an energy policy paper shortly, but he is unlikely to take on the ESB unions with an election less than a year away. Unions at the company are firmly opposed to selling off power stations, although ESB management floated such an idea last year.
The ESB says the growth of an all-island market will dilute its presence. But some observers believe it should reduce to 40 per cent, rather than 60 per cent of the all-island market.
When this market comes into existence the two biggest firms will be ESB and Viridian. Other major players will be Bord Gáis and Airtricity.
Figures were also released in recent weeks by the UK House of Commons showing that the ESB plant in Coolkeeragh, Derry, fell short of its operational targets in the first three months of this year.
The energy regulator is to change the definition of what constitutes a "green" energy supplier, despite objections from some energy companies.
In the past "green" suppliers were those obtaining 95 per cent of their energy from renewable sources during a calendar year. This number is now set to drop to 51 per cent.
