Eamon Ryan (Dublin South, Green Party)

With the agreement of the Government, ESB received my consent, and the consent of the Minister for Finance, to the acquisition of Northern Ireland Electricity, NIE, in July last. These consents were given after consideration by my Department and the Department of Finance of detailed legal and financial advice in relation to the proposal and its implications for the ESB Group, including financial gearings, borrowing levels and investment programmes.

Under the terms of the transaction, ESB will pay £1,034 million, or €1,248 million, for the NIE Group, subject to certain adjustments when the transaction is complete. NIE is a regulated utility and its revenue is derived principally through charges for transmission and for use of its distribution system. NIE's regulated asset base at 31 March 2010 was £1,007 million, or €1,215 million. ESB will also assume obligations of NIE, including those under a £175 million Eurobond, which is the only debt to be taken on by ESB in this transaction. NIE made a profit after tax of some £60.6 million in its last financial year.

Together with the Minister for Finance and my Government colleagues, I am confident that this transaction, when complete, will be an investment that will be to the benefit of both economies in terms of potential synergies and will critically underpin the delivery of the ambitious renewable energy targets set by both administrations North and South. It will allow for greater co-ordination and network planning in relation to the integration of high levels of wind onto the systems.

Security of energy supply is critical for business and domestic consumers and continued cost efficient development of the networks North and South will ensure that the island of Ireland has secure, environmentally sustainable, energy supply for the long-term. This is crucially important for business confidence and competitiveness in both our economies.

In light of the detailed analysis of ESB's own due diligence and all the metrics of this transaction provided to my Department and to our legal and financial advisers, I am satisfied that ESB will pay a fair price for the NIE assets. The acquisition will increase the regulated earnings of ESB and contribute to the value, profitability and growth of the group.

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