I second the amendment standing in my name and in the name of Senator Ferris which endorses the action of the Government in setting up the inquiry to investigate the reasons for the high cost of electricity. It notes, it does not endorse, it does not adopt, it does not seek to implement but notes the ESB five year strategic plan and calls on the Government to have due regard for social, regional and strategic implications for the use of indigenous fuel in national energy policy when considering this ESB plan.
The first point I want to make is one that will be shared by everyone in this House — the need for energy planning. We have a bad record on this. Until we were hit by the oil crisis we did not think it was necessary to have energy planning. We had new developments, of course. We had striking developments away back in the twenties of the hydro-electric installation at Ardnacrusha. In the years immediately after the war we had the striking development of the use of sod peat and milled peat for the production of electricity. In both these cases new ground was broken and courageous decisions were made. We did not have a long continued study with regard to where we were going on energy planning.
I am afraid that there is a tendency today to think that just by having a brief discussion about what the ESB has put forward and how we might react to it, this will be sufficient. We must look not just at energy as a whole and how it will affect us in the light of the standard of living that we hope to provide for our increasing population, but we must look at the different forms of energy. We must look carefully at what are the capabilities of our fuel resources, our traditional hydro-resources and our new energy resources, whether they be solar power, wind power or wave power. We must look at their limitations. We must recognise the fact that renewable resources will not maintain a fraction of the population even at the standard of living and standard of consumption which we have in these difficult times.
When we come to do this planning — it must be done — it needs time and it needs all the facts. In a way, we will tend in the course of this debate, on both sides of this House, to use selected facts. I only hope that those who are responsible for the final decision will look at all these facts. Too many people come into a discussion about energy policy with complete preconceptions. Many people say: "Oh, there is no possibility of nuclear power ever being accepted in this country; it is far too dangerous and the possibility of the loss of life would ensue." We do not seem to count the loss of life of a miner in Poland, or a miner in Austrialia. There are real losses of life going on year after year in providing coal for our power stations, among other uses. We have seen, with our common guilt, the atom bomb; we take an instinctive reaction in saying: "No, this must not be considered." We must look at the facts.
We can look back and admire the excellent work done by the Electricity Supply Board and by Bord na Móna together in making technological breakthroughs in the power station. Let us acknowledge that but let us not ignore the obsolescence of those power stations now, 25 years on. Let us not ignore the fact that many of these power stations are coming to the end of their useful life. The worst thing we could do would be to replace them exactly as they were with the same type of machinery. This would guarantee that we would price ourselves completely out of the market.
We must welcome the decision of the Government that there should be an inquiry into the reasons for the high cost of electricity. If we do not manage to find out the reason and correct it, it will not be the number of jobs that we have been talking about in this House that will be at risk, but the whole of our manufacturing industry, if we cannot plan our energy policy better and if we cannot discover the reasons for the high cost of electricity that is correctable. This inquiry will, we hope, look at our present use of fuel and at what is the best way of using Bord na Móna's output. None of us would agree that the best way is to let milled peat pile up in storage. Of course, we want that milled peat to be used and to continue to be produced, but we want it to be used to the best effect. The problems which have already been mentioned of the pricing policy between the ESB and Bord na Móna must be looked at with care.
The setting up of this inquiry should be welcomed, as we have done in this amendment. It is being chaired by somebody who is independent of all the arguments that have been going on: it is being chaired by the chief executive of an electricity utility in Denmark who can come in not having taken part in any of the arguments about what happened ten or 20 years ago in relation to negotiations between the ESB and Bord na Móna. My understanding is that this inquiry has already produced an interim report and that it will produce a final report in two months time. I would hope that it would only take a further month or two for this report to be considered departmentally and then by the Government. I agree with Senator Ferris that the Government would not be doing their duty if they attempted to come out with a final energy plan so that we could all talk about it next weekend in Laois-Offaly.
The ESB were right to start their strategic study. The ESB have served this country very well and found themselves in the position that the cost of the electricity they were producing was distinctly higher than that of the other countries in the Community. The ESB found themselves in the position where they had over-capacity due to the recession and they were over-staffed. In this connection, we should not be too critical of the decision-makers in the ESB. It takes a very long time to plan, to build and to commission a power station. There is an extremely long lead time. If you have to plan for ten years ahead, and you are planning at a time when for the past five or six years manufacturing industry and its consumption of electricity had been growing at 10 per cent per year, and if you have to make your decisions then, and if you then hit the world recession, hit an oil crisis, which means not a 10 per cent growth but a levelling off, which means an increase in the price of oil which had been chosen as being the economic material, then you cannot criticise those decisions but you can say it should not happen again. One can talk of the need for longer term strategic planning.
The ESB are to be congratulated on having settled down to this particular problem. They have faced their own position and have faced it well. This report which they have produced — there is no need for us to accept it — is something that we should read carefully, but let us acknowledge that the ESB have shown courage; let us in noting this report recognise that they have shown courage in facing the situation.
The last paragraph of the report says that the implementation of any plan will call for a full realisation at all levels of the scale of change necessary in the ESB — this is the ESB talking to themselves for the moment — they must have the courage to make the unpalatable decisions which are unavoidable and the board, their members and staff, must recognise the necessity for radical thinking and innovation.
When we consider a report like the ESB strategic plan, of course, we, as Members of the Oireachtas, and the Government, must look at this in a broad context. This is why we also note in our amendment the necessity that we should, in considering this ESB plan, look at the regional and social aspects of the plan. This is vital. It is vital that in reaching decisions the Government should look at the social effects, but what is equally vital is that the Government should not confuse economic and social effects. What is vital is that none of us should attempt to blur the distinction between economic and social costs. This is a bad habit that we have; this has affected many of our decisions in the past. We have done an economic analysis of a project and then said that because they are social factors, we must now go ahead, but we do not count in quantitative terms the social costs.
We have to get ourselves into the position that when we take a situation like the critical situation now in regard to the position of the Electricity Supply Board, in particular that part of the Electricity Supply Board's capacity which is based on peat, we must have a hard economic analysis, and we must have as hard as possible analysis of the social cost. Then it is a matter for political decision that we can take the decision that the social benefits from a certain course of action are sufficient that we maintain this or that station. We should know how much we are paying for that social policy, otherwise we will find ourselves making decisions that are wrong. We will find ourselves fluctuating according to the state of our feeling in regard to these things. We will neglect social factors at our peril. We will destroy our own community if we do not take social factors into account, but if we merely take them as hunches, if we merely take them as a result of feeling, then we can make equally disastrous decisions which will affect other parts of the community.
That is why we have sought in this amendment to put this question into a broader context, that there must be inquiries, and that we endorse the action of the Government in setting up the inquiry to investigate systematically the reason for the high cost of electricity. This must be part of our discussion on the problem, and that we note what the ESB have done. We need not necessarily adopt it but we must take note. If we ignore what the ESB have said, brush it aside and make our decisions without paying attention to it, then that is not a job well done. Finally, we call on the Government to have due regard to the social, regional and strategic implications of the use of indigenous fuel in national energy policy when considering this plan. If the Government do that thoroughly, as quickly as possible but not precipitately, they will have done a good day's work.