Following the purchase by Spanish utility giant Endesa of the ESB power plants at Great Island in Wexford and Tarbert in Kerry, for a combined price is €450 million, the workers involved have entered negations on their future options.
In a regulatory filing, Endesa said the two stations had a power-generating capacity of 1,048 megawatts, which is about 16 pc of Ireland’s total installed capacity.
Now the company has entered talks with a view to buying Viridian’s electricity generation plant in Huntstown, West Dublin, as well.
In a statement, Spain’s second largest power company explained: “This is a unique opportunity to enter into an attractive market, given that electricity prices in Ireland reflect the real costs and demand growth is above 4 pc per year, with forecasts that this will continue”.
The anticipated purchase of the Huntstown station, with a generation capacity of 747MW, will cement Endesa’s position in the Irish market, say industry sources.
The ESB confirmed that it had reached agreement on the sale of two power stations, two peaking plants and two sites to Endesa. The sites, which are “generation ready” are in Counties Longford and Offaly, while the peaking plants, consisting of four 50MW diesel generators, are in Offaly and Mayo.
Peaking plants are increasingly important as Ireland adds more renewable energy to the grid. They enable power to be added to the national grid at different points when renewable power is not available.
Choices
“This is a further step to reducing ESB’s market share to less than 40 pc, which is what the Commission for Energy Regulation wants and is stated government policy”, said Padraig McManus, ESB Chief Executive. “This is a major player entering the Irish market, bring the number to three – ESB, Viridian and Endesa – and that is about as much competition as a market the size of Ireland can take”.
Negotiations between the ESB, its staff, their representative trade unions and Endesa will now deal with all matters relating to employees affected by the sale, of which there are 180 in total.
It is understood they will have the option of remaining with the ESB, transferring to Endesa or taking a severance package. An ESB spokesman would not confirm that there would be no forced redundancies as part of the transfer, but this has been the State-owned company’s policy in the past. ESB unions are understood to have had meeting with Endesa already.
Profits quadrupled
Under an agreement reached with the CER in 2006, ESB was to sell four plants. The Poolbeg and Marina stations have not been purchased by Endesa but are in the process of being closed by the ESB by 2010.
In exchange for reducing its market power, CER approved the construction of a 400MW ESB power station at Aghada in County Cork.
Endesa, which was acquired by Italy’s Enel last year, reported that its first-half profits this year more than quadrupled after it sold assets in Europe and charged higher prices for power in its home market. Net income rose to €6 billion from €1.26 billion for the period.
The company has also agreed to develop a plan to lower carbon dioxide emissions by 50 pc within the next four years.
