Press release

Chief Executive presents at MacGill Summer School

27th July 2009: ESB Chief Executive, Padraig McManus presents at the MacGill Summer School in Glenties, Co Donegal.

Climate Change, security of electricity supply and price stability are the main rationale underpinning the need for renewables, the Chief Executive of ESB, Padraig McManus, has told the MacGill Summer School.

Speaking in the Glenties on Friday, July 24th, on the subject of "Energy and the Economy - New Approaches?", he said that renewables and particularly wind are essential to the future of electricity generation. No other European country has the same dependency on fossil fuels as Ireland where 90% of electricity is generated from this source.

Predicting that fuel prices will rise again and the cost of carbon will increase, the Chief Executive said that renewables will be competitive in that context.

ESB will have 600 MWs of wind generation in Ireland by 2012, with 200 MWs of on-shore wind in Britain and 1,400 MWs on both islands by 2020. ESB will have invested €4 billion in renewables by 2020.

Currently wind generation is not cheap but the case for making it a key element of energy generation in the future lies in environmental and security of supply factors. He stressed the need for interconnection to enhance security of supply and to support renewable generation.

Many statistics have been produced to show Ireland ranking among the most expensive in Europe in terms of the price of electricity. "The facts do not bear this out. In Ireland as in some other countries there is a standing charge. This distorts price comparisons for lower users. Approximately 300,000 customers out of 2 million customers use very little or no electricity - empty houses, holiday homes, farm buildings. Eurostat figures show in the domestic and commercial sectors, electricity prices in Ireland are only marginally above the EU average", he said.

In terms of electricity prices, Ireland's problem lies in the industrial sector. In the 1990s when ESB was virtually the only supplier in the Republic, the tariff as structured favoured the industrial sector. Today all prices are cost reflective. However, in countries like Denmark, Germany and Holland, the domestic and commercial tariff is way above the European average, while the industrial tariff is below the European norm.

"This fact is well known in the energy sector", he said "We cannot redress this imbalance overnight, but over a more gradual period it would be possible to realign tariffs in favour of the job creation sector", he added.

In the past year ESB has subsidised the entire market including competitors' customers to the tune of €567 million. "It is time for others to play their part", he said. In the meantime, ESB looks forward to the day when the company can compete in the market.

Describing ESB as one of the most successful companies in Ireland, Padraig McManus said its key focus now is on helping job creation. ESB contributed over €2.5 billion to the Irish economy in 2008 and is concentrating much effort and investment in the area of job creation. Energy is potentially a major source of employment and a recent stimulus package announced by ESB outlined the creation of 3,700 new jobs in the economy. ESB is also training 800 apprentices and 300 young professionals and graduates he said. Electric vehicles, a smart grid network, home energy efficiency programmes and a major eco investment fund, along with the redevelopment of ESB's head office in Dublin would lead to major job creation.

Ends

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