Bord Gáis, the State-owned energy company, paid a premium when it raised €550 million through a bond sale in the second of three planned fund-raising events.
Chief executive John Mullins said the bonds had been oversubscribed by 2.5 times but admitted the State-owned energy company was paying a 0.6 per cent premium for the bonds compared to German utilities because of Ireland’s lower credit rating and ongoing concerns over its fiscal position.
He said the reason for this was that “Ireland has a lower rating than our European partners”. Bord Gáis plans to use the cash to fund its expansion.
Speaking on RTÉ's Morning IrelandMr Mullins said the issue of Ireland's economy was raised by investors he met ahead of the bond sale.
Bord Gáis is investing more than €400 million in a new electricity generating plant in Whitegate, in Cork harbour that will be able to supply to up to 400,000 households.
Mr Mullins said the company had signed up 150,000 electricity customers since it entered the market in competition with the ESB and Airtricity, the Scottish and Southern Energy-owned independent operator.
Bord Gáis also announced today that General Electric has won an operations and maintenance contract for Whitegate which will the company said will create 30 jobs. The plant is due to become operational in July 2010.