Ms Jenny Pyper:

The Chairman will note from the graph on security of supply a red arrow that stretches across the period 2016 to 2018. That represents the period where we have procured additional capacity of 250 MW from one of our generators, AES, just to make sure we do not risk the lights going out. One can see from the graph that in 2016 the blue line dips down to 200 MW. Northern Ireland is dependent on three large thermal units. If a problem arises with one of those that could knock out a significant proportion of its generational capability, then we are in difficulty. As a security of supply measure, working with the system operators and the Northern Ireland Department of Enterprise, Trade and Investment, we have procured additional capacity to see us through that period while the Moyle interconnector is being repaired. That is being paid for by Northern Ireland consumers separately. It has no implications for Irish consumers and is adding €5 or €6 to every Northern Ireland domestic bill. That is to keep it in a healthy position for the short term.

Regarding a plan B, regulators are always looking for the most efficient and least cost way of ensuring they get that trilemma balance right. Even if we were to build additional generating capacity in Northern Ireland, it would still have an impact on the all-island market. Those constraints on electricity flowing, being traded and providing security of supply, as well as efficiency benefits to the all-island market, would still be there because there is limited ability for the power to flow between North and South. Both Northern Ireland and Irish consumers would pay by not having the benefits of those constraints being released.

It will be an option for Northern Ireland politicians to consider whether to pay for additional generating capacity in Northern Ireland after 2020, if the second North-South interconnector is not in place.

As this is an all-island issue, there is a direct impact for consumers in the Republic. It is important to understand that, while the security of supply concerns do not directly apply to us - we probably have more comfort in the Republic in terms of the capacity available for generation - there is an argument that we have an excess that cannot flow to Northern Ireland because the second interconnector is not available at the moment, which is imposing costs on consumers. This extra cost, which we think at minimum is about €10 million per annum, is the primary concern from the Republic's point of view.