Toddy O'Sullivan
Question:11 Mr. T. O'Sullivan asked the Minister for Energy if the consultants have been appointed to assess the ESB; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Electricity Industry Review.
Consultants have been appointed to assist my Department in the review of the future structure of the Irish electricity industry. The study does not involve any assessment of the performance of the ESB. As soon as these studies are completed and fully evaluated by me I will be in a position to report to Government.
This question was the subject of our earlier disagreement, a Cheann Comhairle. I received notification from your office today informing me that my question had been disallowed. I cannot understand——
The Deputy should proceed with the question before us.
I received a letter from your office informing me that my question had been disallowed. I welcome the change of heart in regard to this issue. I should like to refer the Minister to a speech he made in Salthill, Galway, on 2 June 1992 regarding the change in attitude to the monopoly position of the ESB. What are the reasons behind this change of attitude — are they technical, ideological or political? I ask the Minister to explain why he thinks it is necessary to now divide the ESB, a company that has served this country well over the years?
Is the Deputy referring to a speech I made in University College Galway?
No, I was referring to a speech made in Salthill on 2 June 1992.
That is a more recent speech. I have informed the House on several occasions that the Government had decided that the introduction of competition to the electricity industry was to be examined. I have been charged with the responsibility of carrying out that examination and to report back to the Government on my proposals which would result in the introduction of competition to the electricity industry. There does not now seem to be any justification for allowing the ESB to maintain a monopoly position in the generation of electricity. It is for that purpose alone that this matter is being examined. It is the intention to try to encourage private investment in the construction of electricity generating plants which would be able to supply electricity in competition with a restructured ESB through a distribution and transmission unit. That is the intention and purpose of this examination.
There is also the obligation imposed on us by our membership of the European Community which is moving in the direction of establishing an internal energy market which will require unbundling in energy utilities and the identification of costs so as to ensure that there is full transparency of costs in the generation, transmission and distribution of electricity and gas. We will be obliged to comply with these requirements in time. This study is being undertaken to achieve the Government's objective of trying to get the best possible value for consumers.
I asked the Minister why the Government believe there is no justification for the ESB maintaining a monopoly position. It is considered that because the ESB are profitable they should no longer enjoy a monopoly position? We should bear in mind that it was the Irish taxpayers who paid for the setting up of the ESB on day one. Are they not entitled to a share of the profits by way of reduced charges? The Minister has to tell us the reasons involved rather than giving us the market jargon——
The time for dealing with priority questions is fast running out.
The Deputy is incorrect in his remarks about the ESB's profits. The ESB are not allowed to make a profit. Under legislation they provide electricity at cost to the consumer and that aspect of the matter will be considered in the overall review of the electricity company.
May I ask a short supplementary?
It must be a very brief question because time for priority questions is exhausted.
Is the Minister suggesting that no section of the ESB is profitable? It is my understanding that the contract work they are engaged in overseas has proved very profitable for the company.
The Deputy is probably referring to subsidiary companies which come under the aegis of the Electricity Supply Board. The core business is to generate electricity, which is what I am principally concerned about.