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Northern Ireland electricity prices may tumble as NIE monopoly under threat

Northern Ireland's domestic electricity sector could be set for its biggest shake up in years, as speculation mounts that Airtricity is about to enter the market.

It is understood that the Irish power company, already a supplier of electricity to business customers in the province, will today announce plans to extend its offering to supply domestic and residential users.

It would be the first domestic supply competitor to the former publicly owned electricity supplier Northern Ireland Electricity since the formation of the Single Electricity Market in 2007 permitted such a move.

Founded in the Republic in 1997, Airtricity is owned by Scottish and Southern Energy, which bought it in January 2008.

Nobody from the company was prepared to comment ahead of an official announcement due at midday today.

The Utility Regulator also declined to comment, but said Airtricity's existing licence to supply business customers covered the company for a potential entry into the domestic electricity market.

Economist John Simpson said that if Airtricity did take the decision it would be "a step in the right direction" to creating competition in the domestic electricity market.

"It is an overdue development that was provided for in the opening up of the single electricity market (in 2007). We have been waiting for someone to come in for some time, because up until now the reshaped NIE has been the only supplier."

Mr Simpson said the key question was whether one new entrant would be enough to bring electricity tariffs down.

One week ago, Airtricity announced it was to enter the domestic gas market in the Republic, creating 200 jobs, including 100 at its headquarters in Sandyford, Co Dublin.

Providing a taste of what NIE can expect in terms of competition, Airtricity marked its entry into the gas market by offering customers a 10% discount on the rates charged by incumbent supplier Bord Gais.

It has also entered the electricity market in the South last year, mounting a high-profile campaign to win customers, claiming it could offer prices 13% below those offered by ESB, Ireland's dominant electricity provider.

The firm already supplies electricity to over 150,000 residential and commercial customers in the Republic and Northern Ireland.