The company is aiming to capture up to 10 per cent of the market by building a pounds 150m gas-fired plant near Finglas in the north of Dublin. The station, to be developed in partnership with CRH, will initially have a capacity of 300 megawatts with the option to double output.
Peak output in the Irish Republic is running at about 3,700 megawatts but demand for electricity is growing at 6-7 per cent a year as the economy expands - more than twice the growth rate in the North. From next February, 26 per cent of the Republic's energy market will be opened to competition but it will openly be big industrial and commercial users that will be free to shop around.
Patrick Haren, Viridian's chief executive, said it had been marketing for over a year to Ireland's 300 biggest customers and was confident it could sell all the output from the new gas plant.
He was speaking as Viridian reported an 8 per cent rise in pre-tax profits to pounds 44.8m for the first six months.
Its non-regulated businesses, including financial services, outsourcing, property and industrial contracting, generated 18 per cent of operating profits.