Tuesday, 24 November 2020

Questions (204)

Denis Naughten


204. Deputy Denis Naughten asked the Minister for the Environment, Climate and Communications the engagement he has had with the ESB with regard to its plans to demolish Lanesboro and Shannonbridge power stations; the total value of electricity customers' contributions through levies and charges towards the capital cost of each facility; and if he will make a statement on the matter. [38858/20]

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Written answers (Question to Environment)

The first progress report of the Just Transition Commissioner, Mr Kieran Mulvey, published on 22 May, reflects a comprehensive engagement with relevant stakeholders in the Midlands, setting out the analysis of the challenges facing the region, and for Bord na Móna workers, their families and communities, arising from an accelerated exit from peat harvesting. The report contains important recommendations. The Government is already acting on a number of these and is committed to preparing an implementation plan to address the remainder, which I intend to publish in the coming weeks. The recommendations and associated actions will support job creation efforts and create new opportunities for Bord na Móna workers in the Midlands. The recommendation of the Commissioner that a study be undertaken in relation to the future potential of the ESB power stations at both Lanesborough (Lough Ree Power) and Shannonbridge (West Offaly Power) for the establishment of a dedicated Energy Hub in the Midlands was subsequently included as a commitment in the Programme for Government.

While the management of ESB-owned facilities is the responsibility of the Board and management of ESB, the decision of the ESB, in November 2019, to close West Offaly and Lough Ree Power stations followed an extensive review of all options and was based on the key planning, climate and commercial factors associated with generation at the sites. My Department has been informed by the company that the current planning permissions for the two sites include an obligation to decommission the power plant and to remediate the sites by the end of 2022 and that, prior to any development opportunity taking place, ESB must satisfy the legal obligation to remediate the existing sites. In addition, I understand that the power plant equipment cannot be used for any purpose beyond December 2020 as neither the planning consents nor environmental licenses cover any such use.

A feasibility study into the establishment of a Green Energy Hub using the existing infrastructure at the West Offaly and Lough Ree sites has now commenced.  This study is being overseen by a steering group chaired by the ESB, and includes representatives of my Department, relevant Local Authorities, and other stakeholders. I expect that the work of the group will conclude by the end of this year, having regard to the timelines required to meet the company’s planning permission obligations in relation to both sites.

Responsibility for determination of the PSO levy is solely a matter for the Commission for Regulation of Utilities (CRU) which is an independent regulator.

The legal basis for the PSO levy and its method of calculation are set out in regulations made under the Electricity Regulation Act 1999 and the Public Service Obligations Order 2002 (S.I. 217 of 2002) under which the CRU is assigned responsibility for the calculation of the levy each year.

The CRU’s decision papers are published and publically available on their website and provide the ex-ante allocation of payments.

Aside from what is put in the public domain by the CRU, I do not have access to information about the total value of electricity consumers’ contribution through charges towards the capital cost of these facilities.  Generators obtain revenue to cover their costs from a number of sources, including from the electricity market and related auctions.  These latter elements in turn are ultimately paid by retail consumers, through various standing, network and variable electricity charges, depending on the type of consumer.

The Deputy may wish to note that CRU provides a dedicated email address for Oireachtas members, which enables them raise questions directly to the CRU, including on the CRU's annual PSO decisions, at oireachtas@cru.ie for timely direct reply.