John Cregan (Limerick West, Fianna Fail)
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Question 98: To ask the Minister for Communications, Marine and Natural Resources the plans for distribution of electricity; if decisions have been made in this regard; when a new system commenced or will commence; the discount or commission which private wholesalers will receive; if charges would be 10% less if wholesalers were dispensed with; if new regulations are being introduced due to EU regulations; if €120 million has been spent on a computer system just to prove that fair distribution is taking place; if the EU pays for this investment; and if he will make a statement on the matter. [9891/05]

Noel Dempsey (Meath, Fianna Fail)
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I recently made regulations — European Communities (Internal Market in Electricity) Regulations 2005, SI 60 of 2005 — to give further legal effect to Directive 2003/54/EC of the European Parliament and of the Council of 26 June 2003, concerning common rules for the internal market in electricity and repealing Directive 96/92/EC.

The directive strengthens, inter alia, the unbundling provisions of distribution system operators by requiring the separation of the network business, natural monopoly, from competitive activities, namely generation and supply, so as to ensure non-discriminatory access to the network and avoid conflicts of interest. The review of the electricity sector, which I recently announced, includes an examination of options for the legal unbundling of the distribution system operator, DSO. Measures for unbundling the DSO are required to be introduced by 1 July 2007 and I am progressing this matter in line with this timeframe.

Liberalisation of the electricity market has proceeded on a phased basis since February 2000 under the regulatory oversight of the Commission for Energy Regulation, CER, the independent regulator for gas and electricity, in accordance with the Electricity Regulation Act 1999. On 19 February this year the market opened fully to competition. All customers are eligible to source their electricity from a licensed supplier and the entire market becomes contestable. Scope exists for all customers, household and non-household, to seek out keener prices in the competitive market.

While there are no private wholesalers, there are six active independent suppliers in the retail market, with 33% of total energy being supplied by these independents. Market opening — the removal of barriers and putting in place the enabling systems and processes — makes it easy and simple for customers to switch and for suppliers to enter the market.

The question of using computer hardware and software to enable the liberalised market to function effectively is a matter for the parties directly involved in consultation with the CER. I have no specific information in this regard.

With regard to new EU regulations, the European Commission will undertake a further in-depth review of progress in creating the internal electricity market this year. On the basis of this market analysis, the Commission will assess the need for additional measures to improve the functioning of the market.