One of the responsibilities of the Utility Regulator is the promotion of competition in the energy market. In the Wholesale Markets Directorate one of the most important areas of work is regulation of the Single Electricity Market (SEM). The SEM, which is the wholesale electricity market that covers the island of Ireland, has been in place since 2007 and ensures that the price of electricity charged to consumers reflects costs.
Progress has been made along with the Commission for Regulating Utilities, which is the regulatory authority in Ireland, to improve the working of the existing market and set up the new wholesale market, the I-SEM.
The SEM market monitoring unit (MMU), based at our offices, continues to monitor the SEM and carries out a number of investigations into bidding practices by generators in the market. The MMU’s quarterly update report is published regularly on the SEM Committee web site and provides an overview of the SEM market as well as information about the volume and price of directed contracts. These directed contracts are forward contracts calculated by the Regulatory Authorities and allocated to electricity supply companies. They allow these suppliers to buy electricity from the Electricity Supply Board (ESB) at a regulated price that reduces the market power of ESB and promotes a more competitive wholesale electricity market.