Pat Rabbitte (Dublin South West, Labour)
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Question 121: To ask the Minister for Communications, Marine and Natural Resources his views on whether the carbon emissions system will significantly impact on the future price levels of electricity; his further views on proposals to restructure the electricity market; and if he will make a statement on the matter. [20633/06]

Noel Dempsey (Meath, Fianna Fail)
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Under current arrangements the Commission for Energy Regulation (CER) permits ESB generating stations to only recover the cost value of carbon allowances purchased under the Emissions Trading Scheme. This approach minimizes the impact of the scheme on electricity prices. Taking this into account, the total impact of emissions trading on electricity prices for the period 2005-2007 should be a little over 1%.

It should be noted however, that the All-Island Single Wholesale Electricity Market (SEM) is due to come into operation in July 2007. The CER and the Northern Ireland Authority for Energy Regulation (NIAER), who are jointly responsible for the design and implementation of the new market trading arrangements, are considering how emissions trading allowances will be treated in the new SEM wholesale market and will determine the scope for measures to minimise the impact on prices.

Accordingly it is not possible at this time to predict the precise impact that the emissions trading scheme might have on prices in the 2008-2012 period. Future directions for the electricity market, will be set out in the Energy Policy Green Paper, taking account of the single electricity market arrangements as well as EU developments and in light of inter alia competition and consumer considerations.