ESB gets green light to build €500m gas-powered plant in northern Spain

ESB CHIEF executive Pádraig McManus has identified Britain and Spain as prime locations for the company's €4 billion international investment plan.

The company has secured key approvals to build a €500 million gas-powered electricity plant in northern Spain.

The project is the second such significant venture by the company in the Spanish market.

Announcing details of the new project in Oviedo, Asturias, this week, Mr McManus also confirmed that the company aims to develop two 50 megawatt wind farms in the Basque region.

The company is also studying the feasibility of solar thermal generation in southeast Spain.

Under EU rules, the ESB is committed to reducing its market share in Ireland to 40 per cent, and is committed to spending €4 billion on plant outside Ireland to sustain its expansion.

Three years ago, ESB International (ESBI) commissioned a joint venture with Osaka Gas in a combined cycle gas turbine (CCGT) near Bilbao, also in northern Spain.

Mr McManus welcomed the Spanish environment ministry's decision to approve an environmental impact statement grant for the new CCGT project in Asturias. He also paid tribute to the government of Asturias for its "strong support and professional commitment".

The new plant will be built on a brownfield site within a Dupont-owned industrial complex at Corvera, close to the Asturian port of Aviles in north Spain.

ESBI will handle construction,operation and commissioning by 2012 of the plant, through a subsidiary company, Asturias Generacion.

ESBI's activities in 115 countries are ring-fenced, and therefore there is "zero impact" on the Irish consumer in terms of electricity costs, Mr McManus said in response to questions.

Michael McNicholas, ESBI executive director, noted that the company had become the first independent power producer in the Spanish energy market, and had developed the first independent power plant in Britain at Corby.

The ESBI built Northern Ireland's first CCGT plant, in Derry, and the company is currently building an 840 megawatt gas power plant in Marchwood, southern England, with Scottish and Southern Energy.

ESBI international investments business development manager Philip Clarke said the proposed CCGT plant at Corvera in Asturias would provide 700 jobs to Spanish subcontractors during construction.

The plant has two outstanding environmental components - a condenser cooled by air, rather than water, and a compact sub-station design that reduced use of land and visual impact.

The ESB has a tradition of always establishing a very good relationship with local communities, which was fostered by "being open and supplying accurate information, as a good corporate neighbour should", Mr Clarke said.

This approach had been taken from the outset with the Corvera project, in consulting and meeting local people and interest groups, he said.

Two months ago, ESBI announced that it had secured a €6.6 million contract with Petrom, the Romanian subsidiary of the Austrian oil company, OMV.

The contract involves design and commission of a power plant near Bucharest.