Mr. Gerard Brady:

For our members, electricity costs are probably the biggest cost concern after labour costs. We have a clear view on why the level of difference exists between here and Europe. That is probably the bigger issue for our members. That goes back to issues that Mr. Minogue has talked about already. One is the challenge we have with infrastructure delivery and the other is interconnection. We are less connected to the European grid than the rest. We also need more infrastructure than other European countries because population dispersion is a major challenge in terms of the level differences.

We do not have a very strong view when we look at the changes in wholesale costs, but the feedback we have is that we did not see, at least in the hedging strategies, as quick a rise on the way up and we are not seeing as quick a fall on the way down. That was the hedging strategy taken at the time. It probably protected us a bit on one end and not on the other. That should start to wash out. Those hedges are there for a period of time.

There is a continued level of cost difference when compared with the other EU member states. I know people have said that in purchasing power terms, we are not as bad but businesses do not operate on purchasing power terms. They compete on a nominal basis and in cash terms against other countries. We see the report coming from the expert group. We are hopeful it will start to answer those questions about the level difference and how we can start to make changes. We have set out some pieces in our budget submission last year, particularly around fixed costs. Those are the things we control on policy and a lot of regulatory and fixed costs have been added in recent years that differentiate us from Europe. Those could be addressed.