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SEM Chart of the Week


The end of the beginning: domestic market share

Oliver Archer Analyst

With switching rates relatively low (3% for electricity in Q318) and incumbent players still comfortably dominating the markets, you could be forgiven for thinking little is set to change in the Irish domestic supply markets. But we believe a closer look at the regulator’s latest market share figures, with an eye on the wider landscape, suggests a market ripe for new entry and innovation.   At the end of Q318, domestic supply was dominated by Electric Ireland in electricity, with a 53% share of customers, and Bord Gáis Energy in gas, supplying 46% of customers. Figure 1 shows the quarterly percentage point change in share of the electricity market, by customer. As can be seen, the incumbent electricity supplier has been losing share, but at a relatively modest rate of less than 0.5pp a quarter. In the gas market the largest supplier lost 0.4pp in Q318, but this has been stabilising, down from a 1pp loss in Q417. Let us not forget though that the liberalised market is still comparatively young, with all sectors of electricity supply deregulated since 2011, and 2014 for gas. Although not a significant fraction of the market at the moment (0.5% of electricity customers at Q318), the group referred to by the regulator as ‘other’ suppliers are making headway. Electricity share for the group grew by 0.1pp in Q318, and by over 1pp in gas. While these changes may appear small, they are happening over just three months. A more liquid forward market is also beginning ...

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