[Article] ESB looses Grid Ownership

mike65

From RTE

The ESB's distribution network is to operate under a not-for-profit basis under new plans announced by the Government to reduce energy costs for consumers.

As part of a White Paper on energy, land which is linked to the electricity network will be set aside for independent power companies.

Ownership of the transmission network, which is under the ESB's control, will move to a separate company, EirGrid.
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The White Paper states that the electricity and gas networks will be kept in State ownership as 'strategic national assets'. Bord Gáis's transmission and distribution functions are also due to be separated.

The Government says it will encourage Bord Gáis and Bord na Móna to develop their role in power generation and supply to compete with ESB and Viridian.

The White Paper also pledges a 'comprehensive review' of the energy regulation system in the context of the all-island electricity market.

Northern Ireland electricity group Viridian, which supplies business customers here, welcomed the Government's White paper on energy, but added that it wanted more details.

'We commend the Minister's commitment to increasing competition and creating an efficient and affordable energy market in Ireland', a statement from the company said.

By the end of 2007 Viridian will have invested €500m in two modern generation plants and it said it is actively seeking opportunities to increase its position in the competitive market.

'However before we can commit to the construction of further modern power plant we will need to see the details of the proposed landbank of power generation sites and the terms on which they will be made available to the market', the statement added.

Chambers Ireland Chief Executive, John Dunne said the business group welcomed moves by the Minister to open up the Irish Energy market to greater competition.

He said that although ESB has co-operated fully with the regulator to facilitate the opening of the market, questions raised in the Deloitte Review of the Electricity Sector in Ireland, in relation to the efficiency of electricity generation and how that impacts on energy costs, have yet to be addressed.

The business group added that the government must look more seriously at market interventions aimed at changing consumption patterns, and it said domestic residential and transport use continue to outweigh industrial use of energy.

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Mike.

FlutterinBantam

First small step shaking up a sector which has been under the radar for a long time....

I expect we will hear some rumblings from a tall glass building near Butt Bridge and other quarters.

There won't be much aggro as they are all too well paid and for the most part highly skilled,as well as having a major stake in the place.

The small % of unskilled in the workforce wouldn't have the clout to disrupt supplies,unlike other sectors;)

mike65

The unions own 5% of the ESB and the grid have been valued at 20 billion euro (I'd love to know how that number was arrived at). So in theory we could get hit to the tune of a billion euro which the workforce pocket.

Mike.

FlutterinBantam

Y'know.. there are some things I find it hard to get my head around.

There you have the ESB,acknowledged by ALL as extremely well paid,total job security,excellent index linked pensions and conditions and it would appear that they are going to resist tooth and nail any efforts to deregulate the industry and ultimately bring lower prices to the consumer.

These overpaid people would appear to have no problem holding the whole country to ransom with power cuts and industrial action,to hold on to their fat pay packets.

When are we going to tell these punters to get real and sort out this crud for once and for all.

mike65

Flutterrin' you better be sat down when you see the front page of the Sunday Tribune.

Mike.

is_that_so

This was him as well. A bit of a habit for Brendan Ogle.

FlutterinBantam

mike65 wrote:

Flutterrin' you better be sat down when you see the front page of the Sunday Tribune.

Mike.

:eek: Not only that Mike and is that soI happened to be listening to the News at One on RTE and heard that the average pay top to bottom in an "admittedly" innefficient area like Poolbeg Stn is 78k p.a.:eek:

No wonder unions and management are joining forces to resist this nooice little earner.They also own 5% of a conservatively valued 10 billion. company .
How did they get that 5%...monies from profits of that company in return for so called productivity!!!!!. No body actually put the paw into the pocket and took a risk.

jaysus:eek: Am I the only one who needs to sit down,Mike I actually hit for the beer fridge, when I heard that, to calm myself down.

parsi

FlutterinBantam wrote:

:eek: Not only that Mike and is that soI happened to be listening to the News at One on RTE and heard that the average pay top to bottom in an "admittedly" innefficient area like Poolbeg Stn is 78k p.a.:eek: .

Any chance of a link ? ANd do bear in mind that it's an average which means that some folk get more and some get less. What's the average pay in your industry ?

Is there some rule somewhere that an ESB worker should get paid less than other people ?

FlutterinBantam

parsi wrote:

Any chance of a link ? ANd do bear in mind that it's an average which means that some folk get more and some get less. What's the average pay in your industry ?

Is there some rule somewhere that an ESB worker should get paid less than other people ?

http://www.rte.ie/news/thisweek/

Mucco

The ESB is fighting a losing battle, as unbundling is an EU directive.

FlutterinBantam

Some more interesting stuff on Pat Kenny today.

Click on listen live and go to 15 mins in

http://www.rte.ie/radio1/index.html

lostexpectation

is this a step to privitisation and Enron style disruption, disruption far greater then unions could manage

FlutterinBantam

Hopefully its a step to lower prices, and a more realistic outlook from a semi state organisation.

ESB has been very innefficient,look at turf burning stations not operating and a workforce still being paid.

I am convinced that with a good minister in charge electricity prices could be cut by around 25%.Streamline the work practices,sack the dead wood,pay the people who are willing to work by all means,but don't tolerate shammers and malcontents.

antoinolachtnai

What it's basically about is that it would reduce the power of the ESB unions during a strike. There had been 13 ESB industrial disputes since the foundation of the State. The unions won 12 of them, and the other one was a draw.

A neutral grid makes it easier to bring non-ESB power stations into the game. If the Grid doesn't go out on strike with the power stations, that also weakens the union position.

fly_agaric

FlutterinBantam wrote:

efforts to deregulate the industry and ultimately bring lower prices to the consumer

Why are so you sure that deregulation would reduce prices?
Some people will make money I'm sure but somehow I doubt joe-soap Domestic Electricity User will see any of it.

Bogger77

antoinolachtnai wrote:

What it's basically about is that it would reduce the power of the ESB unions during a strike. There had been 13 ESB industrial disputes since the foundation of the State. The unions won 12 of them, and the other one was a draw.

A neutral grid makes it easier to bring non-ESB power stations into the game. If the Grid doesn't go out on strike with the power stations, that also weakens the union position.

The grid never went on strike, during every strike I can remember, power was flowing through the network, only the amount going to end users was rationed, ie rolling blackouts.

During a strike, ESB stations and major customers are protected.

In termal power stations, in particular, during strikes, while the boys are out on the line, there's a number of volunteer's doing firewatch in the station. This guys don't get paid for the 8hr's, but it's part of the conditions of employment that during an all out strike presence in the station to spot fires in maintained.

At the moment, a neutral grid will not ensure supply during a strike in ESB stations, as they supply the vast majority of the grid's input. Save importing it, at excessive cost via the interconnector, rolling blackouts will occur.

The ESB can build and run power stations outside of the state, but it's currently crippled from doing so in the republic.

I'm all for the Grid being sold, we have a nice amount of employee shares, as for seeing a reduction in prices, that's unlikely, what occured in California during 1998-2001 is most likely.

antoinolachtnai

Well, the grid won't be privatised, that's for sure. Your ESB and grid shares are basically worthless, because neither company is going to be sold any time soon. Politically, the risks are unacceptable.

What is wrong with importing via the interconnector 'at excessive prices' during a strike? Continuity of supply, rather than price stability is the main issue during a strike.

A neutral grid will allow the ownership of power generation to be diversified. Again, this is a political agenda. Diversification leads to security of supply.

Long-term, the theory appears to be that this will drive efficiency. In practice, what matters is security of supply.

Bogger77

If you believe a netral grid will reduce prices at anytime in the future, you're going to be proved wrong, imho.

I suggest you look at the California situation in 1998 to 2002, when a neutral grid, relying on imports to solve a supply vs demand problem. The consumer got rode to bits, and the supply companies were forced near to chapter11.
Given the interconnector, it's highly likely in an all out strike in ESB here in Ireland, that the ESBi station in NI would be brought to 100%or 110% capacity to help cover the lost stations in the South. Would ESBI charge itself the going market rate, or would it tripple it's price if supplying a Neutral Grid?

Theory of privitised companies driving down costs, and up effeciencies has really worked in our nearest neighbour, hasn't it?

antoinolachtnai

What difference would it make if ESB customer supply had to pay a bit extra for the electricity for a week?

What difference would it make at group level if ESB charged itself more than the market rate? All they would end up doing is paying more tax in the North.

The government is more concerned about security of supply than price.

Bogger77

If the government was concerned about security of supply than price, why is not allowing ESB to invest in new power stations? If you look a the 2 peat stations build by private contractors in Shannonbridge and Lanesboro, both have had problems because the private company cut costs, and both were unable to meet basic safety certification due to it.

All you seem to do is spout the same stuff about neutral privatized being best, name a nation that total open market has resulted in lower prices for consumers, increase in network safety, increased security of supply?
I'll name some failures. UK, USA.

Security of supply cannot not be guaranteed, even with Neutral Grid, in the Republic of Ireland.

We need to be capable of supplying 100% +10% of our daily electricity needs, into the future. We don't have the capacity, and if we start relying on external suppliers for that, we end up dependant on them. Look at Germany and the effect on it during the Russia Ukraine gas standoff. They had only one connection to the Russian gas network, that got squeezed due to political troubles in another country, and bang, it was on 50% on it's gas needs. We have only one gas, and one electrcity interconnection. Via Northern Ireland into Scotland. What happens if the North's grid go out on strike, and there's snow/cold weather in Dublin that day? Where will we find the extra capacity.

More important than Neutral Grid, (I prefer state or semi state ownership to reduce profiteering, ala the UK), we need secure sources of electricity into the future. We need to have the nuclear debate, the renewal debate, and even consider pipeline to Norway from Donegal to connect to their Gas fields, bypassing UK, France, Germany etc.

antoinolachtnai

It's not allowing the ESB to build new power stations because the number one threat to the security of supply is strikes by a union that is too powerful. Building another Moneypoint is a recipe for another 40 years of politicking and threats.

The unions are the only ongoing cause of national outages since the foundation of the state. This is an ongoing political nightmare for every government. It's terrible what is going on masquerading under the name of trade unionism.

The solution is easy, at least for the government. Have a neutral grid, and get the private sector to build more power stations.

This stuff about privately owned peat power stations, which peat stations is ESB making a big profit from or even getting a big contribution to the grid from?

A lot of people think there is quite a bit of profiteering going on in the ESB already.