The idea of the ESB selling off its less efficient plants has been broached in management union discussions in recent weeks, sources indicated yesterday.

The unions and management talks, under the chairmanship of Mr Peter Cassells, are trying to address the ESB's €500 million pension deficit.

But in recent talks attention has also turned to the idea of ESB selling off what are described as "mid-merit" plants, senior sources said yesterday. The Government may seek to include this measure in an overall transformation package for the company. Sources said the Government is likely to ask the company to reduce its dominance in the electricity sector.

This may be in exchange for giving ESB staff a larger stake in the company

The Group of Unions at ESB has attempted to remain united during the talks, but two broad camps have started to emerge.

One group, mainly centred around the TEEU, is refusing to accept that workers will have to make higher contributions in an attempt to address the pension shortfall.

The union is also strongly opposed to any cap on indexation of the pension.

Other unions are more willing to accept changes to the pension arrangements, once it is part of overall package of pay increases and a larger stake in the company.

A spokesman for the company declined to comment on the suggestion that plants might be sold off.