Darragh O'Brien (Dublin Fingal East, Fianna Fail)

I thank my colleagues for amendments Nos. 1 and 2, which I am taking together.

At the outset, I appreciate the support for this important legislation. We are about to embark on the largest and most significant investment in the grid infrastructure, pretty much in the history of the State and certainly since rural electrification. This Bill is an important part of that because it allows an increase in borrowing and it allows for the first time an equity injection in ESB, which will reduce the overall borrowing cost for it.

Unquestionably, we have a country that continues to grow. We have a population, thankfully, that continues to grow. We have full employment in this country. We have an economy that is the envy of most of Europe. I accept we still have challenges. There is no doubt about that.

This legislation will help to underpin price review 6, which is our investment in the electricity grid and in the network over the course of the remainder of this decade. I thank the Deputies for the suggested additions but I am not in a position to accept either of those amendments. In relation to pre-legislative scrutiny, I wrote to the committee seeking a waiver. That was granted by the committee. I thank the committee for doing that. I think it was recognised that this is urgent and important legislation.

The Deputies explained their new proposed subsection (4). That would bring about a prioritisation framework that would require investment in the grid along certain prioritisations. I genuinely recognise the positive intent of what is proposed to ensure the network development priorities will prioritise the connection and supply of hospitals, Garda stations and houses. PR6, when the Deputies see it published, will identify exactly what this grid investment is underpinning. That is underpinning the houses that we need. It is underpinning the social infrastructure, the schools, the industrial infrastructure that we need and the future growth. To present the argument that the amendments here are about us trying to stop Government investing in a grid purely to allow further growth in data centres is not correct. On PR6, the Deputies have seen the draft decision and the final decision should be out shortly. The Deputies will see how that is clearly itemised.

We are considering how this matter can be reviewed but as it currently stands under EU law, connection and supply must be carried out in a non-discriminatory manner. That is prescribed in EU law. However, we are currently considering how this can be reviewed and I will be happy to share that information once that review has been concluded.

Within price review 6, we will have 29 very significant projects for onshore network development planned by ESB Networks, ESBN, and EirGrid within the period of the investment programme.

The vast majority of these will serve the multiple needs I mentioned - security of supply, gird resilience and grid expansion - enabling us to bring additional renewable energy generation and distribution into our grid. Ireland is a European leader in the integration of renewables into our grid. While there are still challenges, it is important we recognise that things have been done well, although we need to do better. We need to meet the critical demand for increased power supply that is there for both residential and business customers.

The new subsection (b) will place specific reporting requirements on the ESB regarding its borrowing. Its borrowing is already outlined and published in its annual report and accounts, which are audited. In light of the significant investment by the State, and as part of the ongoing engagement with the ESB, we will develop a share subscription agreement that will require ESB Networks to provide significant detail on how it is financing, and the financing of its programme of investment, including its debt raising. As part of this agreement, ESB Networks will be required to deliver a quarterly report to me in relation to its ongoing expenditure, its project management and project delivery of the core infrastructural projects of PR 6. First, it is the investment in the quantum of money we need to invest and then it is about making sure it is delivered upon because this is absolutely critical. That will be reported to me directly as Minister. It will of course be open to ESB Networks, EirGrid and others to come in front of the Oireachtas committee, and rightly so.

In addition to the oversight by my Department, the CRU, under the PR 6 guidelines, will also require a significant increase in reporting by ESB Networks on its expenditure and programme delivery. The combined efforts of the CRU and my officials will result in very significant and appropriate oversight of this Government investment on behalf of our people. It will ensure value for money and, most importantly, expedient delivery of the critical grid infrastructure we need to support families, our citizens and businesses in the State.

On the impact of the ESB's borrowing on consumer energy prices, the amount charged to customers by electricity suppliers, including network charges, are a matter for the supplying company. We have oral questions tomorrow morning on this, but I will say that we have already published the national energy affordability task force interim report. We have taken some measures already in the budget. There are further longer term measures we will be working on towards publication of the final report in 2026. We will look at things such as network charges and length of borrowing repayments to reduce that charge on customers. To be helpful, and this is just a guide, the average annual increase for a typical domestic customer's network tariff will be around €6 over the five years to 2030. This does not mean the overall energy bills will rise by the equivalent amount because some of the investments will drive lower overall system costs.

One significant investment that will drive down overall electricity costs is the North-South interconnector, which needs to be delivered. It will be a major project to deliver grid resilience and expansion and will drive down costs for households. I hope and expect we will get support to commence and complete that consented project, which is critical to the all-Ireland electricity network and to our citizens on this island North and South.

The proposed new section 4(c) would prevent any borrowing activity by the ESB that could lead to domestic increases in electricity tariff rates beyond inflation and require the ESB to publish an annual statement confirming compliance. Under its legal mandate, it is the CRU, as the independent regulator, which is responsible for the network tariffs and grid investment plans. Network charges are a primary manner in which grid infrastructure is funded. What we have done, not just through the equity investment in the ESB but the further equity investment we will make in EirGrid, is reduce the amount of borrowing required to allow both organisations to leverage off the capital investment. The CRU sets out the network tariff to align with the grid investment plans. As such, it would not be appropriate to legislate to restrict activities related to the network.

Amendment No. 2 relates to section 3. The Deputies outlined its content. I thank them for the suggested addition, but I propose to reject this amendment also. The proposed new section 7(d) would require an independent audit of the employee share ownership plan, ESOP, as the approved scheme and for the findings to be published within three months.

The proposed new subsection (8) specifies that nothing in the Bill should be construed to allow the sale or transfer of capital stock to anyone other than the relevant Ministers and the employees of the ESB, or the trustees on their behalf. It is already the case that stock in the ESB can only be owned by the Ministers, employees and their trustees through the ESOP. Employees can only sell their stock shares to other employees, the ESOP trustee or to the ESB in a closed market. Any shares purchased by the ESB are cancelled.

The proposed new subsection (9) would involve the creation of a prioritisation framework that would require the investment provided by Government through capital stock subscriptions to be used only for projects that contribute to specific use or specified uses, while excluding upgrades or connections for data centres.

The proposed new section 10 would place specific reporting requirements on the ESB relating to the use of funds invested by the Government by way of the capital stock subscriptions.

The proposed new section 11 would, like the proposed subsection 4(c) and amendment No. 1, prevent any borrowing activity that would lead to any increases in electricity tariffs. I have already responded to the points as to why we cannot accept them.

I thank the Deputies for their support for this legislation. It is critical and important. Everyone in this House recognises the urgent need for increased investment in our grid to ensure that we can continue to expand renewables and drive costs down for domestic and business customers. We are on the cusp of a significant level of investment and output through renewable energy when, last year, over 41% of our electricity was generated through renewable sources. We intend, through these and other measures, including successful auctions we have had in relation to onshore renewables as recently as a number of weeks ago, to further expand the renewables base we have and work towards reaching our target of 80% renewables by 2030. I thank the Deputies for their amendments but I am not in a position to accept them.

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