NI Energy Minister: “I have received assurances from ESB on a range of issues relating to the transaction.”

The BBC reports that the Northern Ireland First Minister, Peter Robinson, wearing his other hat as leader of the DUP, and out-going UUP leader Reg Empey have jointly written to the Irish government to object to the proposed sale of NI Electricity (NIE) to the state-owned Electricity Supply Board (ESB).  NIE is currently owned, through Viridian, by Arcapita, a Bahrain-based bank.

A RTÉ report adds

It has emerged that Northern Ireland First Minister Peter Robinson and outgoing UUP leader Reg Empey have written to Mr Cowen, claiming that the deal has major political implications.

They described the plan as ‘inappropriate’ and said it amounted to the purchase of a ‘key component’ of Northern Ireland’s national infrastructure.

They also said there would have been ‘political outcry’ had the Northern Ireland Executive or the UK government sought to acquire the Irish electricity grid.

Which is probably true…  But as the BBC report also notes

However, the SDLP’s Alban Maginness, who chairs the Assembly’s enterprise committee, explained: “What is being sold off is the grid and we need a tremedous amount of investment in the grid.

“ESB are prepared to put that investment in.”

He added that that although the Electricity Supply Board is owned by the Irish government, it remained independent of it.

In their statement at the time, July this year, Viridian noted

Completion of the transaction is subject to a number of conditions, including conditions relating to Irish and UK competition clearances and notifications and a refinancing of the existing indebtedness of the Viridian Group.  Subject to fulfilment of the conditions, the transaction is expected to complete by the end of 2010.

And this is what the NI Energy Minister, the DUP’s Arlene Foster, said when the proposed sale was initially announced

The Minister said: “I am aware of the planned commercial transaction between the two companies. I have met with senior officials in NIE and ESB, and have also discussed the transaction with the Regulator and the Irish Minister Eamon Ryan TD.

“I have received assurances from ESB on a range of issues relating to the transaction. These include ESB investment plans, the importance of securing existing jobs, and maintaining the identity of the electricity network business in Northern Ireland. I will continue to keep a close watch as the transaction proceeds towards completion, to ensure the interests of electricity consumers in Northern Ireland are being properly considered.’’

The electricity transmission and distribution networks in Northern Ireland are owned and operated by NIE plc. NIE plc itself is part of the Viridian Group which is owned by the Bahrain-based investment bank, Arcapita. The planned transaction would see ESB, the network owner in the Republic of Ireland, becoming the owner of NIE.

Arlene Foster added: “Governments in both jurisdictions are committed to increasing the levels of renewable power generation.

“This will require significant grid strengthening, and I welcome assurances by ESB management of their strong commitment to fund and construct this important infrastructure in Northern Ireland, in addition to delivering on similar commitments in the Republic of Ireland.’’

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  • Pippakin

    Why shouldnt the ESB consolidate its holdings on this island? I would think the DUP and UUP would be relieved it will be in the hands of a company/govt who have a vested interest in making it work, bearing in mind the hell that will be created up there if anything is done that could be however remotely called biased or Gods forbid, sectarian.

    I have the feeling both gentlemen know on which side their bread is buttered and this is yet another preach to the converted, and not meant to be taken seriously.

  • Dev

    I get a ‘leccie bill every quarter from some outfit called “EDF” – I had assumed it stood for English Dirty Feckers owing the prohibitive price of their energy, but what’s this? It actually stands for Électricité de France? My word, foreign-govt-owned companies owning part’s of the UK’s power network, oh the humanity!

  • In fairness the way things are going Bahrain will end up owning NIE again when ESB is sold by a government in Dublin to placate Anglo bondholders at any cost.

  • dodrade

    Empty gesture politics. If it bothers them that much re-nationalise it.

  • Rory Carr

    It is better to light a penny candle than to sit and curse the darkness.

  • Munsterview

    Sinn Fein effectively has…… Semi-State is the closest we can go.

    Nice one SF folks, now can you start work on acquiring the railway lines network as promised ?

    O yes, I almost forgot ….. the roads, how is the due diligence coming along on that?

    Forget about trying to get compensation for the Brits blowing up the bridges all them years ago, just get the bloody thing signed will ye before it becomes a public issue and they go ape s! ( Do not forget if you get the Brits to pay for blown bridges we may have to pay for a few too, let sleeping dogs lie etc)

  • lover not a fighter

    I am surprised that Peter, being an avid wheeler dealer did not buy it himself.

    He is normally well connected when there is a few pound to be made.

  • Comrade Stalin

    This is daft tribalizing on the part of the unionists. Foreign governments have substantial interests (indirectly) in energy investment in the UK. EDF has already been mentioned above – and nobody has mentioned Gazprom yet.

  • SDLP Man

    Complete nonsense from the unionists and especially pathetic from Empey, who had pretensions to be a businessman. This is just whipping up totally imaginary fears among their less-bright supporters.

    Do these people not see how closely the economies of the two jurisdictions are linked and that, for example, the NI agri-business sector is substantially owned by companies in RoI?

    How would the unionists react if some clown called for the expropriation of John Taylor’s (Lord Kilclooney) newspapers which he owns in RoI, the Midland Tribune and the Tullamore Tribune? After all, these are in the Taoiseach’s own constituency and JT has to be up to no good, maybe trying to sneak in a neo-unionist TD for Laois-Offaly?

    God bless him, but Tom Elliott must be the most inadequate candidate ever put forward for leadership of a major party here. He just comes over as a not-too-bright farm boy.His performance on Talkback last Friday was toe-curlingly, excruciatingly, embarrassing.

    Thankfully, this will kill off any talk of a political arrangement between the SDLP and UUP.

  • Comrade Stalin

    Do these people not see how closely the economies of the two jurisdictions are linked and that, for example, the NI agri-business sector is substantially owned by companies in RoI?

    Given the close link between the economies of the island of Ireland and GB it’s a wonder, then, that the SDLP’s apparent pragmatism doesn’t stretch to the natural conclusion of this argument, namely the reunification of Ireland within the UK.

  • aquifer

    So will our Orange street lights be going green?

    More sectarian scaremongering that can cost us dearer electricity.

    The 15 Watt bulbs of Northern Ireland politics. Not so bright.

    I may have to go out into the dark street and put some money on Basil.

  • Greenflag

    Will the last Unionist leader in Northern Ireland switch off the Republican ‘electricity’ before they leave -please ;(!

    There are gobshites and there are gobshites and then there are these eejits :(!

  • Can anyone remember what Peter and Regs views were on the power workers strike in 1974

  • What ? I really can’t believe this……….southern ‘Catholic’ electricity going into Northern TUV and DUP homes !!!!!! Perish the thought.

    What will it come to next ? UTV owning media outlets in the Republic, people in the North shareing a national airline (Aer Lingus) with the RoI, shareing a railway line (Dublin to Belfast), BT ownng a national phone service, Tesco and Debenham stores everywhere, a national/internalional rugby team etc etc.

    This take over ws first anounced last July. Why has Robinson et al only become aware of it now ?

    Florida in late Summer and early Autumn is a lovely peaceful sun-filled place. Unless one has other things on one’s mind.

  • SDLP Man

    Comrade Stalin
    What sort of clown are you trying to make school boy debating points? The thrust of my argument was that closer economic linkages don’t necessarily have to have adverse political implications. As it happens, I’m in favour of an ever-closer European Union and that, down the road, could lead to more pooling of political sovereignty, subject to democratic consent..

    You know perfectly well that RoI will never rejoin the UK and allow its political sovereignty to be subsumed especially a UK where there are significant centrifugal forces such as the demand for Scottish independence. The Union (1801-1921) was a total disaster and you know that perfectly well. The will of the great majority of the people of Ireland was ignored throughout that period

    Given the amount of Foreign Direct Investment by US companies into RoI, it would be more logical to call for RoI to become the 51st state.

  • fin

    There is a certain poetic justice here, the first bombs of the troubles were used used to blowup (or try to) NIE and ESB stations, they were planted by the UCDC/UPV one of Ian Paisley’s earlier ‘organisations’ with the intention of the IRA being blamed.

    40 years later the DUP and UUP are writing letters……………

  • Greenflag

    ‘Why has Robinson et al only become aware of it now ?’

    Aquifer in his post above gives a hint with his traffic light reference 😉

    Green is for GO
    Orange is for SLOW (DUP style)
    Red is for STOP (UUP style)

    The Titanic was built by the Orange which is why it sank slowly 😉 Had it been built by the Green it would have sunk in 3 minutes or it would have defeated the Iceberg and there’s no telling in advance which .

    BTW in the matter of sharing

    The island has

    1 Rugby team
    1 Cricket team
    2 International Soccer teams
    3 Prime Ministers (1 South & 2 in the North sharing is compulsory)
    274 elected representatives all playing for themselves .

    4 Catholic priests (including 2 Vietnamese, 1 Zambian and rumour has it that the NIgerian fella has gapped it back to sunshine land -the grey skies got to him in the end )

    But hey it could be worse .

  • Greenflag

    Fin

    ‘ it would be more logical to call for RoI to become the 51st state.’

    Would it ? An interesting what if . I’d guess that if it had to be one or the other and if both the USA and the UK had to put forward a list of their relative attractions (excluding Disneyland and sunshine of course ) and the economic , social, educational , pluses and minuses were added up it would be a case of

    ‘Back to the UK ‘ by an island wide 75 % to 25% .
    The USA is in major need of financial , societal and educational and health reform and they can’t afford it and or don’t want to pay for it and then theres the never ending war mongering to grab extra market share which goes by the euphemism ‘free trade’

    BTW +Scottish independence is in a bit of an economic limbo right now . Its all quiet on the northern front for now . The Scot nats are hoping for Cameron to aid their cause in the usual Tory fashion in due course.

  • fin

    And given Irish investment in US treasury bonds, what would be more logical? Prrovinces 5 to 55 so we can keep an eye on our investment

  • Neil

    It’s telling that these guys think that they can score points in this fashion, that’s to say by vocally opposing the transfer of an asset (which the UUP helped on it’s way to privatisation) from a Bahrain company to an Irish one. Free market forces are a bitch.

    The hypocrisy is rank, it underlines the total lack of substance underlying the whole UCUNF, Catholic candidates, moving forward, ‘new politics’ bullshit Empey pumped out during the election, clearly all of it a purely cynical attempt to play to the masses.

    When push comes to shove they’d rather anyone on Earth owned or operated NIE than our neighbour to the south. Imagine selling a part of our infrastructure to the damn Irish? It’s not on, we’d rather it was owned by a company based thousands of miles away.

    The ‘new’ forward looking UUP plays the tribal card. Again. Empey = liability. He can’t remember what he said he stood for last week. I’m only surprised he hasn’t tried to form a pact with Veridian, Arcapita and ESB. Aw well Reg, back to the drawing board, you could always call the PUP (again), it looks like they’re about to implode anytime so they’re probably ideal for ya.

  • Greenflag

    I believe a Bahrain Company executive got a heart attack when he took a drive through some parts of Belfast . While the Palestinians flags were a surprise it was the Israeli flags that helped the Bahrainis to head for the exit.

    ‘The hypocrisy is rank, it underlines the total lack of substance underlying the whole UCUNF, Catholic candidates, moving forward, ‘new politics’ bullshit Empey pumped out during the election’

    Indeed it does . McCrea as leader will have an uphill battle to restore some credibility to the party.
    Ellipt as leader might as well not even bother .

  • Dec

    “They also said there would have been ‘political outcry’ had the Northern Ireland Executive … sought to acquire the Irish electricity grid.”

    Aw, bless…

  • John East Belfast

    “He added that that although the Electricity Supply Board is owned by the Irish government, it remained independent of it.”

    Albann McGuinness shows he doesnt know what he is talking about – The ROI Govt appoints the Board – they are going to do their beckoning.

    In the Chairman’s report on their last accounts he talks about the Return he is giving to the “taxpayer” in these times.

    Hence the Shareholder/Govt/Taxpayer in this organisation is the 26 counties.

    Hence in terms of squeezing Revenue, cutting costs and where Investment is allocated it will be done at the expense of Northern Ireland consumers and taxpayers – especially in these very challenging economic times where the ROI is on its own. It will simply see it as a way of milking the UK Exchequer.

    Anyone who does not believe that is naive.

    In addition ESB Employees have a history of militancy – once again we will see the ROI GOvt bottling decisions and making the cost savings outside its own back yard.

    There are so many reasons why this is a bad idea – there is not a country in the world which would surrender a strategic monopoly to the Govt of its neighbour.

    It isnt even good for competition – north or south.

    I have worked in the Private sector for over 20 years including a lot of time with ROI projects – I know from experience that when push comes to shove ROI Companies will ultimately act in the best interests of the ROI unless there is a compelling financial reason not to do so.

    This sale would mean that NI energy costs and Energy infrastructure decisions will be made not on all Ireland basis – which is what is exciting the nationalist posters on here – but on the basis of what will be in the best interests of 26 county tax payers and consumers.

    I have problems with monopolies anyway and I am not even convinced such utilities should be privatised.
    However if they are going to be privatised then its needs to be proper privatisation and not just the Northern bit – my bit – and then ownership gets transferred to a neighbouring Govt with objectives that are not purely commercial.

    It is totally ludicrous.

    This sale needs to be blocked

  • Neil

    There are so many reasons why this is a bad idea – there is not a country in the world which would surrender a strategic monopoly to the Govt of its neighbour.

    However it being owned by a Bahrain bank wouldn’t raise any objections. I wonder why? Could it be because in your house, Irish is a dirty word? Let’s face it Mugabe could buy NIE and you would have less of a problem than the dreaded Irish. Hankering back to the UWC strike much?

    This sale would mean that NI energy costs and Energy infrastructure decisions will be made not on all Ireland basis – which is what is exciting the nationalist posters on here

    Haha, nationalist posters. Love it, though some of the people above might take issue with being described as ‘nationalist’, probably due to them not being nationalist.

    I have problems with monopolies anyway and I am not even convinced such utilities should be privatised.

    I quite agree, though it was done with the political support of the UUP was it not, your party of choice..?

    As I said, free market forces rule ok? Also the prices are monitored by the regulator, and as a fact, the Bahrain bank that looks after the loyal sons of Ulster so well is currently taking in the most money in western Europe per unit of electricity sold, it’s unlikely that the deal we end up with will be worse than the one we have now, i.e. the worst in western Europe. Your scaremongering over a perfectly everyday free market transaction won’t make a lick of difference. Welcome to the 21st century John, you’ll not like it here.

  • JR

    May as well get ready for the United Ireland with a few infrastructure link ups, that’s what I say. I cant wait to warm my toes with some nice green electricity.

    I hear sales of small wind turbines, solar panels and batteries are going through the roof in north Antrim!!

  • barnshee

    “However it being owned by a Bahrain bank wouldn’t raise any objections. I wonder why? Could it be because in your house, Irish is a dirty word? Let’s face it Mugabe could buy NIE and you would have less of a problem than the dreaded Irish. Hankering back to the UWC strike much?”

    HMMM —Mugabe now there is an idea.
    Do what he did –let the ROI make all the investment it wants then just expropriate the system. No wait a minute the ROI will come and take away power stations power lines etc
    Ha Ha ha -just love the idea

  • Neil

    Let me pose a question to those who think that the ESB deal is a precursor to the Irish army coming over the border: are you happy paying more than anyone else in western Europe for your electricity? Is it ok to be ripped off as long as it’s good Loyalist/Bahrainian electricity?

    Try to be honest, at least with yourself. The only problem is the mention of ‘Ireland’. Bahrain: no problem, company operates under Sharia law half way around the world: no problem. Irish: OMG they’ll be sending in the Irish army next, it’s clear an invasion is being planned, quick we have to act against the barbaric papists from the South.

    Laughable is all it is. They had professors on the news last night all talking about how it makes sense, of course it does, why have two systems being maintained on one small geographic area when you could integrate the two and make the whole thing more efficient, but hey I guess those professors are all closet papists sent to trick the loyal tribe in Ulster into unity, hell they’ll be up removing the power lines and closing the plants down justy for shits and giggles.

  • SDLP Man

    John East Belfast

    “I know from experience that when push comes to shove ROI Companies will ultimately act in the best interests of the ROI unless there is a compelling financial reason not to do so.”

    Had to laugh at that one when I think of the approx. 5 billion Euro which Dublin-based Anglo Irish/First Trust/Bank of Ireland lent to developers to buy ludicrously-overvalued terraced houses and crap land banks in NI. Gosh, that turned out to be a real good deal with the RoI taxpayer!

    JEB, I think you need to look seriously at your prejudices. The only authority which could conceivably have the power to block a commercial deal like this would be the UK government and they would be faced in all likelihood with an enormous fine by the EU Commission, probably many millions of Euro.

    Think of it this way, JEB, you can now compare electricity unit prices on an island-wide basis and, if they vary, think of the political issue you have been handed. to NI’s disadvantage

    This whole affair brings back memory of Paisley’s absurd campaign against BGE’s pipeline and “the green, green gas of Rome”,

    Still, you have an alternative you can always switch to Airtricity which started off as an RoI company and ended up being bought by Scottish and Southern Energy in 2008, a UK utility. Didn’t hear you complaining then, JEB, and neither did the Irish government.

  • John East Belfast

    Neil

    Do you actually engage your brain before you start posting ?
    I couldnt be bothered retorting your petty points so dont feel I am being rude when I dont respond

    SDLP Man

    You really arent much better

    “Had to laugh at that one when I think of the approx. 5 billion Euro which Dublin-based Anglo Irish/First Trust/Bank of Ireland lent to developers to buy ludicrously-overvalued terraced houses and crap land banks in NI”

    What stupid point is that you are making ? Are you saying they knew they were paying over valued prices and did it as an act of charity ? You are talking as much bollix as your MLA Albann

    As for my “prejudice” the only prejudice being displayed here is your desire to label me prejudiced.

    The point being made here – if it really needs to be spelt out – is the fact that the Shareholder in ESB is accountable to the ROI Electorate and the ROI taxpayer. That Shareholder will then appoint a Board that acts in its long term interests and Return on investment will be only one of those interests.

    Hence in this severe economic climate we are all facing it would be very naive to think that decisions would not be made that limit the impact on ROI consumers, voters, employees and tax payers.
    And due to the unique geographical aspect of an all Ireland energy set up I am sure that the ESB could engineer it in such a way that the financial burden falls on the 6 counties and hence is effectively subsidised by the UK Exchequer.
    Indeed if I was on the ESB Board and accountable to the ROI Govt then that is what I would be thinking.

    It really isnt rocket science and you would be asleep on the job not to see it.

    I have no problem with ROI Companies owning NI ones – I believe in free trade.
    However I do have a problem with us enacting privatisation in the north and then the southern Govt buying it instead.

    On a general note I do observe that northern nationalists seem to embrace every bit of all Irelandary without really thinking through the consequences.
    The ROI Govt gives you a pat on the head but you really are innocent to believe that the ROI Govt will not act in the interests of the 26 counties at all times – cross border shopping, and agricultural – they are totally partitionist when it come to their interests.

    They will do the same with the electricity grid.

  • Co’nel Myers

    Northern Ireland’s provincial infrastructure.

    Fixed that for him.

  • Munsterview

    John EB

    Please behave yourself and be a little more polite to Neil !

    Last warning…… keep this up and I will call the ESB and have them switch off the light !

  • The Semi State boards do the bidding of the government? Jeez, if only that were true…

  • lover not a fighter

    So long as the ligts don’t go out on Unionism where is the problem !

    Are some believers beginning to flicker !

  • SDLP Man

    JEB
    In charity, I think there is a touch of paranoia about your attitude. I think you are seeing potential for conspiracies where absolutely none exist. I’ll repeat my point: you said that RoI investors act in the best interests of RoI, I was simply pointing out that RoI banks and their client developers, acting in their perceived best interest and under your logic, the RoI government, actually have brought the RoI economy to its knees.

    I would love someone with the background knowledge to tell us something about the electricity sharing arrangements in other parts of Europe, for example the Benelux countries.

    By the way, JEB, do you disagree with my point that the EU would come down like a ton of bricks in the very unlikely event that the UK government would stop this deal?
    NIE under ESB ownership would, as any commercial enterprise will do, make investments where there is a return. Do you accept that NIE unit prices are among the highest in Western Europe? If so, you have an excellent chance of comparing unit prices North and South and, if you prove your case, I’ll be the first to put up my hand and say I’m wrong.

    Over 40 years ago, pre-Troubles, there was a North/South electricity interconnector which in effect gave us a substantial step towards an all-Ireland energy market. The Provos repeatedly blew that up as part of their mad ‘armed struggle in the same way as they repeatedly blew up the Belfast-Dublin railway line, all in the name of uniting Ireland.

    It’s interesting that today, JEB, you effectively have the same mindset as the Provos.

    If you are representative of the UUP mindset, I’m really sad. I bet you voted Tom Elliott tonight.

  • david

    Reg Empey is meeting Bill Gates and the top fifty Irish-Americans in finacne this week in New York to try secure inward investment,

    He says, “northern ireland is open for business”
    ——————————————————————————–
    Just not to the Irish then, Empey.

  • dible

    Oh dear JEB, lets look at the South’s telecom public infra.

    Now owned by the Singapore Govt.

    Why is it that they are not upset in Dublin? Its because it doesn’t matter who owns it, because the South’s public infra, like the North’s, and like just about everywhere else is REGULATED BY THE GOVERNMENT. In little ol’ NI’s case that the BRITISH GOVERNMENT.

    So Seamus of the south’s telecomms bill wont be written in Chinese, and JEB’s lecky bill wont be written in Irish, so rest easy.

  • RJ

    What is the Point of this Post anyway,
    Who cares what two Party leaders [1 Former by now]
    says, as long as Investment Comes in then thats the Best Thing,
    im an Irish Nationalist but most of my food is English does it mean im not going to eat it because it was made in england no.
    The Two Cry Babies oh sorry Unionist should just get over there self and go on Reeping Money from the Taxpayer like there Good At one better than the Other mind you. if Martin McGuiness have of said it then i would of been Interested what the Problem is
    but because its these Guys its Just more Anti-Irishness.
    they should really look up some of the Itims they use
    most of them are so called ”Foreign”
    for Example O2 Is French, and 3 Is German but it doesnt chage anything everyones going to use it anyway.

  • Gendjinn

    Another fine example of how the Alliance party aren’t unionists.

    *rolls eyes*

  • tadhgin

    There are some questions to be asked about the purchase by ESB of NIE, but they are not the ones being raised here.

    First of all, note that the Northern Ireland Authority for Utility Regulation will continue to regulate NIE Transmission irrespecitve of whether the owner is a Middle Eastern bank or a state owned enterprise. This means that transmission charges, plus network development plans will still be overseen by a NI (i.e. UK) public body. ESB cannot get away from these obligations they are a central part of EU energy law.

    Second, There have been a number of cross border takeovers in Europe in the last year. For example the state owned Tennet of the Netherlands bought the eon transmission system in Germany. Elia, the Belgian TSO, bought the Vattenfall tranmission system also in Germany (Note that Vattenfall is itself a Sweedish company – it bought the old East Germany system after reunification)

    Finally, I cannot see what grounds the NI or UK governments could (formally) object to this purchase*. Perhaps the Irish government might have a reason to object as they could implicitly be seen as on the hook for whatever extra debt ESB is taking on. However, I think at the moment given the risk premiums being charged on Irish debt, ESB would be in a stronger position as in the end there are assets underlying this debt!

    * There may be concerns about vertical integration of ESB, but given that Viridian is itself vertically integrated these would not be a valid legal objection.

  • tadhgin

    To continue… the issues whihc should be raised are:

    What impact will this have on the implementation of EU legislation on seperation of generation and network activities.

    Given that Irish government policy is to transfer the network assets of ESB to Eirgrid (to support competition by establishing a transmission system operator with no connection to generation or supply), how is it that ESB is buying more network assets in Northern Ireland!

    This raises the question of whether EirGrid will eventually also take over Northern Ireland Electricity’s network business. This makes sense as EirGrid already owns SONI – who actually operate the Northern Ireland grid on a day to day basis.