Tuesday, 29 November 2011
Pat Rabbitte (Minister, Department of Communications, Energy and Natural Resources; Dublin South West, Labour)
The Deputy is right. I did say that I expected a decision at the end of October or early November, as I was so advised. I believe that is what would have happened were it not for the rather unusual step by the company to lodge a formal complaint with the European Commission against the process underway by the regulator. One can understand the lodging of a complaint against a decision of the regulator but it is unusual to see an action taken against an anticipated decision by the regulator.
This regulatory issue is complex. Under the current regulatory regime the coming on stream of this liquefied natural gas, LNG, project will have implications for gas network tariffs set by the regulator. The same applies to the Corrib field. This, in turn, will have implications for general wholesale gas prices bearing in mind that the model is based on Irish prices following United Kingdom prices plus an additional amount for the price of transport through the interconnectors. In an environment in which gas from the Corrib field and LNG meet some or all of Irish demand, the interconnectors built and owned by Bord Gáis Éireann would become under utilised and their proper remuneration by the reduced number of gas customers becomes an issue. In such circumstances, the prices for the consumer would go up and there would be a windfall gain for the multinationals.
Deputy Ferris is likely to be minded to agree with me that this is not the outcome we seek. We have no wish for prices to be pushed up as a result of a stranded asset, that is, the interconnector, and a windfall profit to the multinationals, much as we welcome them here, whether they are associated with Corrib or LNG. I have met the company and I have met several colleagues who have made representations to me, including Deputy Ferris, the Minister, Deputy Deenihan and Deputy Spring. Others have made representations and I have met members of Kerry County Council and Shannon Development as well. We had a situation whereby we were correct to anticipate a decision at the end of October from the regulator but, ironically, the action of the company has delayed it.