The capacity of the State's power generation network is "substandard" and new plant is required immediately, the national grid operator has warned.
Stating that the system would operate "outside standard" next winter, it said failure of the existing plant to perform well could prompt power cuts when demand is highest.
EirGrid will be separated from the ESB later this year. It controls the generation and transmission of power in the national system, ensuring the supply of electricity meets demand from industrial and domestic customers. The company said remedial action such as the installation of emergency generation would also be required this winter. Such measures were being pursued by the Commission for Electricity Regulation to limit the risk of power cuts.
In a Generation Adequacy Statement 2001-2007, published today, EirGrid said: "Until the provision of commercially competitive generation in 2002, there will be periods when emergency measures to procure short-term capacity of short-term demand interruptibility are highly desirable in order to limit the potential effect of a generation shortfall.
"Probably the most critical issue during this period will be the availability of existing and committed generation plant. Any deterioration in the generation forced outage probability could, for example, have a major consequence for supply continuity."
Only when new generation was available in 2002 would the situation become "much more acceptable". New power stations will be opened in Dublin next year by the ESB, in joint venture with Statoil, and by Viridian, the former state monopoly in the North.
EirGrid said: "Longer term, assuming a properly functioning market with adequate investor incentives, there is no reason why generation adequacy should not be maintained with standard from 2003 onwards."
The power market was partly opened to competition last year. While this means the ESB no longer has a monopoly on the supply of electricity to industrial users, surging demand linked to the boom means new generation will be required sooner than forecast.
Citing this, EirGrid said: "The installation of new generation capacity is no longer carried out as a result of centralised planning by a vertically integrated utility with a supply obligation to all customers, as was the case with ESB prior to the liberalisation of the market.
"In future, new generation will be constructed by market participants responding to investment opportunities that are perceived to be financially attractive. It is therefore very important that the electricity market in Ireland is designed, established and operated in a manner that facilitates an economically efficient and sufficiently secure supply of electricity."
Market insiders privately criticise the structure and pace of deregulation of the industry, arguing it is not favourable to competition. The EU Competition Commissioner, Mr Mario Monti, has cited similar concerns.
