Cantillon: Time to end the ESB’s dominance?

Now that the strike notice has been lifted, we can breathe a sigh of relief that the ESB’s workers will not be taking en masse to the picket lines.

There was some confusion as to just what would have happened and who would have suffered most in the event of an all-out strike at the energy supplier. Some reports suggested that blackouts, or “outages” as they are called these days, would have been widespread.

However, over the weekend, the Minister for Communications, Energy and Natural Resources, Pat Rabbitte, into whose bailiwick the State-owned company falls, suggested that the impact might not have been so severe. He pointed out that peak demand in the Republic is in the order of 5,000 megawatt hours. We could, he said, obtain all but 1,300 of that from sources outside the ESB, including other power suppliers and the interconnectors with Britain.

Demand tends to peak in December, as long nights, cold weather and industry and business going full tilt in the run up to Christmas makes it one of the busiest periods for electricity consumption.

The ESB still has a dominant position in power generation in Ireland. One way of ensuring that a strike there would not inflict a lot of damage would be to limit this.

This was one of the Government’s stated aims when, as part of the State asset disposal plan announced in 2012, it said that it would ask the ESB to sell some of its power plants. One of the criteria it was going to apply was actually reducing the company’s dominance in power generation.

However, so far, the ESB has sold only its stake in an English plant. It is offering its share of in a Spanish facility for sale along with two peat-burning generators in the Republic.

Assuming those disposals go ahead, that is not going to have any impact on the company’s dominant position. Is it time that the Government considered ordering the State company to sell more of its Irish facilities? Presumably the events of the past few weeks most have focused a few minds.