Friday, 13 November 2015

ESB call on energy regulator to cap subsidies to wind

Electric Ireland, the supply part of ESB Group, the largest electricity generation company in Ireland, has called on the Energy Regulator (CER) to cap and even reduce subsidies to wind energy. The letter was sent to the CER during consultations on the PSO Levy in July this year. 

Electric Ireland welcomes the proposed reduction in the overall PSO levy for 2015/16 period of c. 9% compared to the current period and notes the positive impact this will have on all electricity customers. However the proposed PSO levy of €304.8m will continue to be a significant burden for all electricity customers and adds considerably to the overall price of electricity. 

Electric Ireland also notes that over 50% of the proposed PSO levy (€173.9m) relates to Renewables and suggests that every effort be made in future years to cap, and ideally reduce, this amount. The wind market in Ireland is at this point a mature and well established market and we believe it does not warrant any further subsidy beyond current commitments. The hardpressed energy customer cannot sustain further subsidisation through the PSO and we would urge policy makers to ensure no additional subsidies are created beyond existing PSO commitments.  

It is difficult to see how the Government can justify increases to subsidies to wind generators, although Energy Minister Alex White seems committed to fulfilling every wish of the wind industry.


  1. The ESB were always sceptical about wind and some of their engineers agree it is useless. Unfortunately they are building wind farms themselves. Central to this is the question "what is a subsidy?". The best subsidy is a guaranteed market at a guaranteed price. Because of machine performance reduction and failing wind speeds, the margin is already low, so any cut at all may bring companies below the "break even line" and into loss making. The detail of the subsidies is not in issue, government either supports wind or it does not. Support means making sure all parts of the system (including fossil generation) is kept viable by laws to set prices.

  2. For the benefit of international readers, the ESB is the Irish Electricity Supply Board. It was formed as the only Irish semi state body responsible for electricity supply in the 1920's (I think). It also has responsibility for fisheries on waters where it has hydro power,