Brian Walsh (Galway West, Fine Gael)
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Question 430: To ask the Minister for Communications, Energy and Natural Resources his views on whether the involvement of Bord Gáis Éireann in the establishment of Irish Water will represent an opportunity for the expansion of the natural gas network in conjunction with work carried out on water services infrastructure; and if he will make a statement on the matter. [21452/12]

Pat Rabbitte (Dublin South West, Labour)
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The development and expansion of the natural gas network is in the first instance a commercial matter for Gaslink, a subsidiary of Bord Gáis Éireann (BGÉ), which is mandated under Section 8 of the Gas Act 1976, as amended, to develop and maintain the national network system for the supply of natural gas that is both economical and efficient.

The Commission for Energy Regulation (CER) is statutorily responsible for all aspects of the assessment and licensing of prospective operators who wish to develop and/or operate a gas distribution system within the State under the Gas (Interim) (Regulation) Act 2002. I have no statutory function in relation to the connection of towns to the gas network.

The CER, in 2006, approved a new network connections policy, which created the opportunity to reassess the feasibility of connecting certain towns to the gas network. In order for any town to be connected to the gas network, certain economic criteria need to be met as a prerequisite. The policy framework provides that, over a certain period, the costs of connecting the town to the network are recouped through the actual consumption of gas and the associated tariffs. This is designed to obviate against uneconomic projects which would increase costs for all gas consumers. The policy framework allows for the appraisal of a town either on its own or as part of a regional group of towns.

Having full regard to CER's network connections policy, Bord Gáis Networks, and more recently Gaslink, carried out a comprehensive assessment of 39 towns not already connected to the national gas network, with detailed economic analysis based on criteria outlined in the policy. The study was published in April 2010 following approval by the CER. The Gaslink report found that 35 towns, when appraised on an individual basis or as a group, did not qualify for connection on economic grounds. The report can be accessed at www.gaslink.ie.

Gaslink continues to keep under review the towns which did not qualify for connection under the Study, and other towns, on an ongoing basis. The key factor which would qualify a town or group of towns in any future review would be a significant increase in demand for natural gas, usually resulting from the addition of a new large industrial or commercial facility.

The recent decision to establish Irish Water within the BGÉ Group reflects the Government's confidence in BGÉ. BGÉ's experience and management expertise in key areas such as raising finance, operating and investing in critical network infrastructure and delivering excellent customer service, can be quickly deployed to assist in the successful establishment and operation of Irish Water. It would be premature at this stage to speculate on the scope for any operational synergies over time between the respective operation, maintenance and development of the gas networks and the water networks by the two entities with the Bord Gáis Group.