Bord Gáis Energy has assured gas customers of Iberdrola that they will face no disruption in supply and that their accounts will be seamlessly transferred to the utility following the Spanish supplier's decision to exit its retail activities in Ireland.

"Bord Gáis Energy can reassure gas customers of Iberdrola that there will be no disruption to their gas supply," the company said in a statement. "Gas customers of Iberdrola need take no immediate action as the transfer to Bord Gáis Energy will occur automatically."

Iberdrola is quitting Ireland following an internal strategic review that found market conditions and pricing exacerbated by inflation in wholesale costs were barriers to its planned growth ambitions.

The Commission for Regulation of Utilities has now been asked to initiate the automatic transition of Iberdrola customers' gas and electricity accounts to the regulator's designated suppliers,  Bord Gáis Energy for gas, and Electric Ireland for electricity.

"Despite our best efforts, it’s become increasingly clear that the dynamics and pricing within the Irish energy supply market mean we will not be able to achieve what we want for our retail business in Ireland," an Iberdrola spokesperson said.

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“Without the ability to achieve long-term customer growth on both a competitive and commercial basis, we’ve made the difficult decision to leave the supply market in a controlled, responsible and appropriate manner, with minimum impact on our customers.

“We’ll be working closely with the CRU, Gas Point Registration Operator and Meter Registration System Operator to ensure a smooth and seamless transition for our customers and we thank each and every one of them for their support over the last three years.” 

Iberdrola's investment in renewable energy in Ireland, including plans to develop 3GW of offshore wind capacity in partnership with DP Energy and battery energy storage system projects., is unaffected by the closure of the retail business.

Its decision follows that of Bright to exit the Irish market at the start of the year, while Glowpower's future is in doubt after it stopped accepting new customers several months ago.

"At one stage, there were 14 residential energy suppliers in Ireland, which is a huge number given the small size of the Irish market. So exits and consolidation were always likely," said Daragh Cassidy of price comparison website  Bonkers.ie.

"As with previous casualties, Iberdrola struggled to gain a large market share, and the recent energy crisis would only have exacerbated things.

"Unfortunately further exits from the Irish market can’t be ruled out," he added. "Electricity prices in Ireland are the fourth most expensive in the EU, and the most expensive once you strip out the effects of taxation.

"However, these higher prices aren’t due to a lack of competition among suppliers, but rather higher costs and inefficiencies with generating electricity in Ireland, as well as the costs of transitioning to renewables.

"The increase in electricity use from data centres is also having an impact. So Iberdrola’s exit is unlikely to have any material impact on prices."