Government want families to pay to cover up their mistakes on electricity supplies

In Blog by Denis Naughten

The Governments proposed law to force families to pay for 450MW of electricity generators is ” the chickens coming home to roost Bill”.

None of what is in this proposed law  should come as a surprise to anyone, particularly anyone in government because over a long number of years they have been made well aware of the issues we are facing now. We are told the objective behind the Bill is to provide temporary electricity generation to replace older power plants and meet the growing demand for electricity caused by data centres. Interestingly, on 7 June 2018, after a very long, protracted and detailed set of discussions at Cabinet, the Government published its statement on the role of data centres in Ireland and the enterprise strategy related to it. In the report there is a section on electricity infrastructure that highlights the growing demand that would be placed on the electricity network by continuing to allow data centres to be given connections to the grid and granted planning permission. The report states a large proportion of existing and planned data centres were due to connect to the electricity system in the Dublin area and, based on the committed expansion of existing data centres and expected growth, the total demand could treble within ten years. Sadly, the legislation we are dealing with today is in large part a result of the unhindered approval of data centres connecting to the electricity grid.

The report raises the question of who will pick up the tab for the increased investment that needs to be made in electricity generation, electricity transmission and the distribution networks. Ultimately it is the electricity users who have to pay for it. The customers of the electricity suppliers have to pay for it through their electricity bills. This is done in part through the public service obligation levy to meet the generation aspect. Then we have the transmission costs paid to EirGrid. This particular report, produced in June 2018, highlighted the impact this would have on higher network charges and increased PSO levies. It stated mitigating measures should be taken to minimise these charges to ordinary electricity customers. To date absolutely nothing has been done to mitigate the cost of this. Families throughout the country are struggling to pay their electricity bills. They have to decide between paying electricity bills and putting food on the table. They are subsidising the green electricity going into the data centres and its transmission costs and distribution costs. The Government continues to sit on its hands on this issue. As I told the Cabinet back in 2017 and 2018, it is immoral to be asking families who are struggling to pay their electricity bills to pay for the cost of this additional electricity going into the data centres. That is exactly what the Government is proposing to do with the legislation before us.

Part of the need for the 450 MW of electricity is because we have decommissioned power stations. The impression being given by the Government is that this is to replace older power plants but it is not. We are also replacing some new kit. I brought this to the floor of the House on 3 December 2020 when I questioned the Tánaiste on the two power plants in Lanesborough and Shannonbridge. Mr. Ciaran Mulvey, the Government’s just transition commissioner, had said in a report that on its visit to Shannonbridge and Lanesborough the just transition team was impressed by the pristine state of the power stations. Why would they not be in a pristine state? At that point in time they had a ten-year lifespan remaining. I pointed out to the Tánaiste on the day that we were effectively wasting €176 million of electricity customers’ money that had been paid towards the cost of those two power plants which were being mothballed because of the decision taken. I said at the time that electricity customers in particular would foot the bill for the demolition of those pristine plants and that they would have to pay for the alternative technology to provide replacement stability on the electricity grid. Here we are today bringing forward legislation to do just that.

What is frustrating about this is that we convinced the Government, and it was written into the programme for Government, that there would be a review of all of this before any decision was taken. A steering group was established. Of course the steering group involved the ESB, which had its own vested interest in ensuring both of the plants were decommissioned.