Vol. 61 No. 18
I move:
That the Dublin Gas Order, 1966, proposed to be made by the Minister for Transport and Power and laid in draft before Seanad Éireann on the 5th day of July, 1966, under subsection (4) of section 10 of the Gas Regulation Act, 1920, be approved.
Gas undertakings generally operate under special Acts which authorise them to manufacture and distribute gas in certain specified areas and which impose certain controls on their finances. Modifications to these special Acts may be made by Order under section 10 of the Gas Regulation Act, 1920. Before an Order of this kind is made it has to be laid in draft before both Houses of the Oireachtas. The Houses of the Oireachtas may, by Resolution, approve the draft Order in the form submitted or they may approve it with modifications or additions. When such approval is given I may make the Order in the form in which it has been approved.
The Alliance and Dublin Consumers' Gas Company have applied to me for a special Order. The objects of the proposed Order are to enable the Company to raise £500,000, by borrowing, to increase fourfold the amount of revenue that they may allocate for replacement or renewal of plant each year, at present the limit is £26,000 a year, and to increase similarly the limit to the total amount in the funds which can be set up for such purposes, at present the limit is £260.000, to use more of their lands for the manufacture of gas and for ancillary activities and to acquire, by agreement, further land for other purposes and to take over, jointly with Calor Gas Limited, the interests of G. Anderson Ltd., 11 Merrion Square, Dublin, in a number of the smaller gas companies in Ireland.
Notice of the proposed Order was published by the Company in Iris Oifigiúil and in a daily newspaper.
The Company also sent copies of the draft Order to the public and local authorities concerned and to the occupiers and landlords of houses within three hundred yards of the site which it is proposed to use for the manufacture of gas.
No objection to the proposed Order was received.
Apart from the power relating to the takeover of the interests of G. Anderson Ltd. in the other gas companies, the powers requested by the company are necessary in order to make improvements in their gas manufacturing process which will be required if the gas undertaking is to survive against growing competition from suppliers of other fuels. The new process will use oil instead of coal as its main raw material.
The proposed takeover is in the interests of the smaller gas undertakings as it will place the company's resources in the fields of science and technology at their disposal and should improve the supply of gas to the communities served.
I am satisfied as to the need for the Order and that there is nothing in it repugnant to the public interest. I, therefore, recommend the Order for the approval of the Seanad.
This is an Order which I think the House will have little difficulty in approving. I think the procedure which has been adopted here is one which we have been commending to other Ministers in Bills they have been passing through the House within the last year. I am very glad to find that the procedure for submitting Orders in draft to the House has its roots in the Gas Regulation Act, 1920. I hope that the speed with which this Order will go through this House, as I think it has gone through the other House, will show to the Ministers concerned that where Orders of this kind are made the Houses of the Oireachtas act reasonably and the procedure which is adopted does not necessarily involve any delay in the making of the kind of Orders which are required to be made under various Acts of the Oireachtas.
It seems to me to be right and proper that a company such as the Dublin Gas Company should be enabled to increase its capital to the extent indicated in the draft Order, and I hope that the Dublin Gas Company will continue that procedure. Although I am not a gas user myself—and, indeed, I had to ask the Gas Company to remove gas which I had supplied to my dwelling because I had the experience of inhaling some of it at one time—I have never heard anything but the highest praise for the courtesy, competence and efficiency of the Dublin Gas Company, which is the kind of example which I would suggest should be followed in detail by semi-State bodies involved in the supplying of power to the community. I do not think I have ever heard any complaint about the manner in which the Dublin Gas Company conduct their affairs. On the contrary, I have on numerous occasions heard great praise of the Dublin Gas Company, and I hope with the extension of their activities, with the increased capital they will get as a result of the making of this Order, that they will continue to give in increasing measure to the community in Dublin the services for which they have been so justly acclaimed up to the present time.
There is one aspect of the Order about which I am more curious than concerned. The Dublin Gas Company are taking over jointly with Calor Gas Ltd., the interests of G. Anderson Ltd. I wonder has the Minister any discretion, or power, in relation to a matter of this kind. I think he and his Department will be aware of the fact that there has been a number of accidents through the unfortunate misuse of bottled gas.
Recently, when a strike was pending in the ESB, I had occasion to get one of these cylinders and the necessary accompanying jets, and so on, as a kind of temporary makeshift for domestic purposes. I cannot say that on any cylinders I got there was any notice indicating the dangers attending upon misuse or any word of caution issued to the purchasers of bottled gas. Could the Minister use his good offices with the Dublin Gas Company, and, indeed, with other manufacturers or suppliers of bottled gas, to ensure that all the dangers inherent in the misuse, or the accidental misuse, of bottled gas will be brought to the notice of consumers?
I can quite see that when somebody is selling a product he does not want to advertise any of the disadvantages that may be attached to its use. I do say that the Minister should request this to be done by the Gas Company when they take over with Calor Gas Ltd. G. Anderson Ltd. If there is not some agreement reached among the consumers of bottled gas as to the kind of warning that should issue, power should be taken in legislation, as was done in the case of oil heaters, to ensure that this is done for the protection and safety of the public. Apart from that, it seems to me that this is an Order which the Oireachtas should, as the Minister said, approve and it only remains for me to wish the Dublin Gas Company success in their expanded undertaking.
I remember we had something like this in connection with the Cork Gas Company some years ago. I was arguing then that the gas company was in a rather special position and that it was because of that this measure of control was imposed on them by the 1928 legislation. These are not ordinary commercial businesses engaged in competition. They are in a rather privileged position in that there is only one gas company and you do not have a number of gas companies supplying gas to your house and you use one or the other according as the price varies. Once you get the gas into your house you intend to use it and the supplier of gas is in a rather privileged position in that respect. It is because of that that there is a measure of control which we do not impose, for example, on the oil companies or commercial organisations.
The purposes of this Order are generally acceptable to me. There is one question I should like to raise in regard to the £26,000 per year allocated for replacement and renewal of plant. That is possibly well justified because of the extension of the area the Dublin Gas Company now services, but I should like to know from the Minister if this would lead to the issue of bonus shares by the Gas Company eventually, thereby, in effect, taking higher profits from the consumers. We all know the device of laying aside a certain amount of the profits each year, accumulating them in reserve and then suddenly issuing them as bonus shares to the shareholders, the public believing that the dividend is the same, about six, seven, or eight per cent, whereas the capital may have been increased fourfold by this device. I should like to know if the Minister is in a position to prevent this. It is to be hoped that the permission given to the Dublin Gas Company to lay aside a greater amount each year, which of course will come from the profits as a result of their operations, will not result some years later, the capital having been increased by a bonus issue—the dividend, I think, is controlled for gas generally and may still stay at the normal level—in the profit on the subscribed capital being increased. Has the Minister provided for this or will it be possible by reason of this Order that this could happen subsequently to the Dublin Gas Company?
When the Minister is replying perhaps he will indicate what the consequences are expected to be as a result of modernisation of equipment and the change in the foundation fuel for the provision of this service. I understand that a consequence will be much reduced costings in fuel and, furthermore, effect a greater safety in the use of the finished product. I should be glad if the Minister when replying would refer to these aspects and to the possible results to the industry that would flow from these developments.
Arising from this Order, we note that the process for the manufacture of gas is to be changed from coal to oil. This is a fundamental change and I wonder whether, in the circumstances, a change to natural gas might not be more in line with future economies in this field because we see the great change which has come about there. Now it is quite feasible to transport natural gas, under pressure, from regions in the Sahara and elsewhere and use it much as we use calor gas. From the rate at which natural gas fields are being discovered at present, it would appear that in the near future natural gas may be a very strong competitor to oil for the production of gas. I wonder whether the Minister can enlighten us as to what is the present relative position and whether the margin between the two, which is decreasing very steadily, will create the likelihood that in the near future the balance will swing over to natural gas. We have read with great interest recently there is a possibility that there might even be natural gas deposits under the Irish sea. If that were the case, of course, it would mean that we would be able to use it without the long transport which is now one of the factors which increase its costs.
I thank the Members of the Seanad for their friendly reception of the Order.
Senator O'Quigley made a remark about the time taken being very short to discuss this Gas Order, which has proved right since the debate has been of very short duration ; but, if all the Statutory Instruments laid in one way or another before the Oireachtas were debated, the time taken might be excessive. However, I will not engage in controversy of that kind.
I am sorry the Senator had difficulties about the accidental inhalation of gas. In actual fact, the Dublin Gas Company, as time goes on, will be installing equipment which will eliminate the amount of carbon monoxide in gas which can be the cause of poisoning, in certain circumstances. I have not had very much information about the explosive effect of calor gas but I will draw the attention of the calor gas companies to the observations made in relation to the possible danger of explosion. There must have been a very small percentage of casualties through the explosion of calor gas and kosangas in the past ten years but whether or not that might justify some precautionary notices on the bottled gas equipment I do not know. At least I will refer it to the companies concerned for attention.
Senator Murphy asked questions about possible increased profits through increasing the amount allowed for replacement of assets. I understand the £26,000 additional money to be used for the replacement of assets cannot result in an increase in the capital upon which increased dividends can be paid. The amount devoted is purely for the replacement of existing assets, not necessarily for an increase in the total amount of capital upon which dividends can be distributed. Incidentally, Senator Murphy probably knows that in 1957 an Act was passed eliminating any control over the dividends paid by gas companies in this country because of the tremendous competition between the gas companies and those providing other fuels, domestic coal, electricity, calor gas, kosangas and oil for heating. I should also make it clear that the Dublin Gas Company is not taking over the calor gas companies but is taking over, with Calor Gas, the company of Anderson Limited. It is a kind of joint operation.
Senator O'Sullivan and Senator Quinlan referred to various matters. I understand that natural gas is not economic for the Dublin Gas Company to use at the moment. The piping of this gas would be uneconomical and its movement in vessels from the sources where it is obtained would not be economic for their purposes at present. As the Seanad may know, legislation is being introduced this autumn to enable the Oireachtas and the State to have control over the coastal continental area in regard to natural gas exploitation. If natural gas should be discovered on the Continental Shelf adjacent to the island, then we would have to examine again whether or not it would be economic for the Dublin Gas Company to use natural gas. At the moment, I understand it is not economic and, therefore, the proposal is to make use of oil.
The Dublin Gas Company has shown reasonable initiative in examining all the new methods of producing gas and I have encouraged them at all times to examine what lies in the future. As I have said, at the moment it would not be economic to make use of natural gas and indeed, if Senators will read the correspondents' accounts in the British newspapers, it will be seen that there is still a wide area of controversy as to exactly how natural gas in the North Sea is to be integrated into the general fuel and energy economy of Great Britain. It is still a matter of acute discussion and controversy, particularly in regard to the price to be charged. Therefore, it is a matter of which I really have not any great knowledge at the present time because it is Still under examination and liable to re-assessment, I think, in the course of the next two or three years.
I thank Senators for their reception of the Order.
