Irish state energy supplier ESB turns up heat on Big Six with UK launch

THE UK’S increasingly competitive energy market will become a little more crowded later this year with the arrival of Ireland’s state energy provider.

ESB, the state-backed supplier for most of Ireland’s homes, is poised to enter the British market within months to battle more than 50 rival suppliers now vying for customer accounts.

The Irish group already has an established presence in the UK power generation sector but hopes to establish a more competitive presence through a retail arm.

ESB is responsible for one of the few new gas-fired power plants to be built in recent years. The 884MW Carrington plant outside Manchester began generating power last year and ESB also runs the 350MW Corby power plant in Northamptonshire, as well as a wind farm in England and one in Wales.

ESB signalled its interest in the UK retail market late last year after approaching British service providers to explore a potential market entry. The utility has now confirmed its plans to enter the UK market before the end of the year. At the time, the Irish Independent reported that ESB was planning a “soft launch” in July with a full offering to follow in October. A spokesman for the company declined to comment on whether this timetable was still on track.

“ESB is in the process of fulfilling all regulatory requirements in advance of entering the GB energy market later in 2017,” he said. ESB is the latest in a string of foreign challengers to brave the British energy market. Engie, formerly GDF Suez, of France, and Sweden’s Vattenfall have both said they plan to launch retail offerings this year.

The wider choice of suppliers is expected to pile further pressure on to the UK’S Big Six energy suppliers, which are steadily losing market share to new challengers. It is also expected to bring about more consolidation among the almost 50 upstart challenger brands. Vattenfall, which is best known in the UK as an offshore wind farm developer, reportedly snapped up energy minnow isupplyenergy to use its 120,000 customer base as a stepping stone into the market.

Equity analysts at Jefferies have warned that this year is likely to be another record year for customers switching suppliers. “In 2016, independent suppliers gained 1.1m net customers from larger suppliers. For the January to July period this year, a net 812,982 customers have already switched to independents, up 6pc from last year,” Ahmed Farman, an analyst at Jefferies, said.