A decision of the European Commission has given a boost to the ESB's controversial plans for two new power plants at Shannonbridge, Co Offaly, and Lanesboro, Co Longford.
Essentially, the Commission has backed the Irish Government's proposal that electricity customers support the use of indigenous fuel, in this case peat, as a fuel for power generation.
The approval of this Public Service Obligation (PSO) system has been hailed by the ESB as "very significant". Without European approval for the PSO, peat generation would not be feasible, a spokesman said.
The ESB applied for planning permission for the plants in July. It says construction of the facilities, using the most advanced technology, will create 80 direct jobs and support "hundreds more" in the peat industry.
A spokesman for the ESB points out that the European Commission's support for the PSO system is conditional upon the power plants being new and highly efficient.
Older, inefficient plants, some of them up to 40-years-old, will face a phased out, in line with the plans for the newer ones. About 8 per cent of electricity is currently generated from peat, but under this PSO decision, up to 15 per cent may be generated from that source.
"The Commission noted that following an examination of options, it had been found that closing the existing peat stations and replacing them with two state-of-the-art stations was the most efficient solution to meeting the Irish government obligation on ESB to generate using peat," said a company statement.
The cost of generating from peat, according to the ESB, has always been included in the overall cost of electricity, so there would be "no increase in electricity prices".
Including the independent peat station at Edenderry, there will be three new peat stations in service. The new ESB plants will have a total of 250MW capacity, enough to supply power to 250,000 homes, says the company.
It rejects concerns that the plants will damage the environment, insisting the advanced technology will comply fully with existing and new EU regulations. None of the peat will come from conserved bogs or those listed for conservation, it says.
According to the power company, the two plants will cost more than £200 million. Subject to planning approval, the ESB hopes to proceed with construction next year.
The plans for the two plants are being given priority status by An Bord Pleanβla, a source said. A decision is expected by mid-February.
One of the two applications is currently at inspectorate stage and the second is expected to reach that stage shortly.
Objections have been received from various parties, including An Taisce and Friends of the Earth.