The ESB is facing a fine of up to €12 million if the performance of its power stations does not radically improve, under plans from the energy regulator Mr Tom Reeves.
Currently, on average only about 76 per cent of power stations are available to generate electricity at any one time. Mr Reeves is determined to improve on this figure and wants ESB, as the dominant player, to at least reach between 83 and 85 per cent.
Under an "incentive/penalty" plan the ESB will be fined if availability remains at the currently low levels, but the company will be rewarded if availability is increased. The company has until May 24th to respond to his proposals.
Mr Reeves proposes a sliding scale of penalties or incentives in order to get ESB Power Generation to improve the availability of plant. If ESB can reach an 89 per cent availability, a €7 million incentive will be available. If the company reaches a target of between 83 and 85 per cent the impact will be revenue neutral.
Mr Reeves plans to administer his plan by adjusting what is known as the "bulk power arrangement". This covers the amount of revenue ESB Power Generation is allowed to charge other ESB divisions. Mr Reeves has authority over this arrangement.
The ESB does not disclose the precise performance of individual stations but some of its older plants are believed to suffer from regular breakdowns, known as "forced outages". At other times the plants are out of action for scheduled repairs, known as "scheduled outages".
Mr Reeves has told the ESB it cannot simply cancel these scheduled outages to increase the availability figures. He has told the company, however, that events outside the ESB's control will not be included in the availability calculations. Mr Reeves will shortly discuss with ESB what force majeure events should be excluded.
Some of the ESB's plants are understood to be prone to breakdowns or outages, particularly older stations. Among the oldest stations in the company's portfolio are Poolbeg in Dublin, which dates from 1971; Tarbet in Co Kerry which dates from 1969 and Great Island in Co Wexford which dates from 1967.
However, other sources last night claimed the age of the stations was not necessarily the problem. "Stations in the US can often be up to 50 years old, the crucial factor is how well the stations are maintained on an ongoing basis," said one source.
However, the shortage of power in recent years has prevented ESB from carrying out the level of repairs it considers necessary.
Mr Reeves is determined that all plants improve their performance, but the ESB is the dominant player in large scale power generation. The only privately-owned large plant is Viridian's gas-fired Huntstown plant in north Co Dublin. However, it is relatively modern and is not believed to suffer from regular outages.
