Release March 22nd 2012: 'Safety Before LNG' condemns illegal political interference
with the independent energy regulator for the benefit of Shannon
LNG as an attack on the democratic process.
- Official Ethics complaint lodged in Leinster House by 'Safety Before LNG' against
Kerry T.D. for encouraging Energy Minister to illegally interfere with
the Energy Regulator for the benefit of Shannon LNG.
‘Safety Before LNG’ believes that it is simply irrational for Kerry politicians to
lobby for an illegal intervention with the independent energy regulator which
would force Irish consumers to pay up to €50 million more per year for the
Shannon LNG terminal which is not safe, would add to air and water
pollution and hinder tourism and industrial development in the Shannon Estuary.
Minister for Energy Pat
Rabbitte has continually stated in the Dail that he will not interfere with the
Energy Regulator in its decision making process on the Regulatory Treatment of the Bord Gais Eireann Gas Interconnectors.
Speaking in the Dail on Wednesday
March 7th, 2012 Minister Rabbitte said that:
2012, Paddy Power, Managing
Director of Shannon LNG, told a meeting of Kerry County Council that the
proposed CER decision would cost the company €75 million
annually. Two days later, four local Kerry
deputies - Arthur Spring (Labour), Brendan Griffin (Fine Gael), Martin
Fein) and Tom Fleming (Independent) - all spoke in the Dail in favour of intervening for Shannon LNG
any due regard for the current cost of the project to the consumer and
the reasons the changes were being proposed in the national interest in
the first place.
Before LNG’ warns that any
illegal political interference, illegal lobbying or illegal peddling in
influence with the independent energy regulator should not be tolerated.
'Safety Before LNG' has
therefore, under the Ethics in Public Office Acts 1995 and 2001, lodged
a formal complaint with the Committee on Members' Interests of
Dail Eireann on a possible breach, by Brendan Griffin T.D on Wednesday
22nd February 2012, of the code of conduct for members of Dail Éireann
other than office holders.
Encouraging the Minister for
Energy to interfere with the CER decision-making process to the benefit of
Shannon LNG would encourage rather than prevent a conflict of interest as it would improperly and
dishonestly further the private financial interest of individuals within
Shannon LNG and people involved in the Shannon LNG project without
consideration for the public interest.
This is, we believe, explicitly forbidden under codes 1 to
4 of the code of conduct for members of Dail Éireann other than office holders,
implemented under the Ethics in Public Office Acts 1995 and 2001.
'Safety Before LNG' is of the opinion that the Kerry deputies are
showing a total disregard for the democratic process which requires checks and
balances and a separation of powers within the system and which outlaws interference
with the independent regulator.
‘Safety Before LNG’ states
that it is extremely worrying for the democratic process that local Kerry politicians
would attempt, on the floor of the National Parliament, to encourage illegal
political interference with the decision making process of the independent
energy regulator for the benefit of Shannon LNG.
'Safety Before LNG' is of the opinion that local Kerry politicians
are committing a breach of the public trust placed on them and undermining the democratic process in
encouraging interference with the independent energy regulator’s
decision-making process to the benefit of Shannon LNG.
'Safety Before LNG' believes
that by asking the Minister for Energy to, in the Minister’s own words,
“break the law” the integrity of the Dail has been brought into serious
Deputies are obliged to exercise the influence gained from membership
of Dail Eireann to advance the public interest rather than advance the
interest of a private company, Shannon LNG, which has not yet even made
a decision to invest in a project.
‘Safety Before LNG’
condemns any illegal political interference with the independent energy regulator
for the benefit of Shannon LNG as an attack on the democratic process.
It is simply not acceptable that given all the financial problems the
country has gone through in recent times through lack of regulation and
accountability that local kerry politicians would try to get the
Minister for Energy to illegally interfere with the decisions of the
Energy Regulator for the benefit of a private company - Shannon
LNG - at the consumers' expense.
Extra costs to Ireland of about €1 million per week for a company whose
owner's, Hess LNG, are registered in the offshore tax haven of the
Cayman Islands cannot be in the national interest. Either the
politicians involved do not understand the complexities of the Shannon
LNG business model or else they do not care for the national interest,
but either way they are not doing their jobs in this matter. The Kerry
politicians need to explain themselves for their low standards of
accountability and transparency in their unacceptable attacks on the
independent energy regulator.
Quotes from various politicians:
Martin Ferris T.D., Sinn Fein, Kerry North-West Limerick (speaking in Dail, March 7th 2012):
Jimmy Deenihan T.D., Minister
for Arts, Heritage and the Gaeltacht, Fine Gael, Kerry North-West Limerick, has already stated publicly to
the "Limerick Leader" newspaper on May 21st 2011 that Hess LNG should not have to pay
any money to the CER for the interconnectors and Minister Deenihan went
on in the same interview to state:
We are concerned that the CER be allowed to make an independent decision on this
issue and not be influenced by the implied threats of a sitting member
of Cabinet, the Minister for Arts, Heritage and the Gaeltacht,
Mr.Deenihan (who does not even have an energy portfolio).
Only 2 members of the Dail Eireann have correctly agreed with the need to respect the separation of powers as follows:
Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin
North Central, Fine Gael) speaking in the Dail on November 22nd
disgraceful lobbying by Kerry politicians for Shannon LNG is more like mob rule
with total disregard for their obligation to behave objectively and in a manner which is
consistent with their roles as public representatives and legislators.
This issue is
now more than just about illegal interference with the independent energy
regulator by Kerry politicians for the financial gain of Shannon LNG at the
consumers’ cost; it is about low standards in high office by an untouchable,
bullying elite of local politicians not even bothering to pay lip-service to the national interest.
speaking out against the bullying Kerry politicians lobbying for Shannon LNG to
the detriment of the national interest would give a message that their
unethical behaviour is acceptable.
disgraceful behaviour by Kerry politicians is setting a controversial precedent
where, if unchecked, politicians will be allowed to illegally interfere with
the other independent regulators in crucial decisions for the private gain of
individuals against the national interest. This is a step too far.
Dr. Vincent Cunnane,
chief executive of Shannon Development, has also been lobbying heavily for the
benefit of Shannon LNG as reported in the Irish Examiner on March 15th
Development will receive €20 million for the site from Shannon LNG if the
project goes ahead (confirmed by Minister Deenihan, Kerryman 18th May
2011 ). Why did Vincent Cunnane, the head of a government-owned regional development
company, have to fly all the way to America
to meet the head of Hess LNG and then return to Ireland and lobby for interference
with the independent energy regulator’s decision for the benefit of Shannon
LNG? The McCarthy Report has already recommended the
discontinuation of an independent Shannon Development at an annual saving of €2
million to the Exchequer. We believe that Vincent Cunnane is more interested
in the €20 million his company hopes to gain from Shannon LNG, which could
prove critical for the survival of his company Shannon Development, rather than
value for money for gas consumers in Ireland. Vincent Cunnane is not openly declaring these
conflicting concerns as he lobbies for the benefit of Shannon LNG with the independent
We wonder if the
local Kerry politicians are acting in
the national interest, the local interest,
incompetent or legally corrupt. Shannon LNG will receive a minimum of
€22.5 million extra per year if it can convince the Regulator that it
should not have to contribute to the cost of the Interconnectors. The
hungry-for-votes politicians are doing the dirty work for Shannon LNG.
The multinational Hess corporation is benefitting from the political
Ireland to get their own way at the consumers' expense. The local
politicians are using highly questionable means to avoid losing votes.
It is now time
that the Hess Corporation openly reveals the companies and individuals in
Ireland that it will pay or has paid for services to date – either directly or
indirectly – so that any conflicts of interests can be avoided and investigated
in a timely manner in a decision-making process that could net Shannon LNG millions
of euros at the expense of Irish consumers.
demand, in the interest of financial transparency, that the Hess Corporation and
all politicians lobbying for interference with the Energy Regulator’s
decision-making process for the benefit of Shannon LNG declare any political
donations received directly or indirectly from Hess by them or their political parties.
At the very
least, in the interest of transparency, the politicians need to back off
interfering with the independent regulator.
Members of Dail Éireann other than office holders (referred to
hereafter as "Members" ) recognise that it is in their individual and
collective interest to foster and sustain public confidence and trust in
their integrity as individuals and in Dail Éireann as an institution.
To this end, Members should at all times be guided by the public good
and ensure that their actions and decisions are taken in the best
interests of the public.
Members are in the unique position of being responsible to the
electorate which is the final arbiter of their conduct and has the right
to dismiss them from office at regular elections. Accordingly, and as a
matter of principle, individual Members are not answerable to their
colleagues for their behaviour, except where it is alleged to breach the
obligations to answer to them which have been placed on Members by law,
by Standing Orders or by Codes of Conduct established by the House.
To this end and in exercise of the powers conferred by Article 15.10
of the Constitution, the Members have adopted this Code of Conduct, the
purpose of which is to assist Members in the discharge of their
obligations to the House, their constituents and the public at large,
without, however, trespassing into areas where Members more properly
submit themselves to the judgement of their electors rather than the
jurisdiction of this House.
1. Members must, in good faith, strive to maintain the public trust
placed in them, and exercise the influence gained from their membership
of Dail Éireann to advance the public interest.
2. Members must conduct themselves in accordance with the provisions
and spirit of the Code of Conduct and ensure that their conduct does not
bring the integrity of their office or the Dail into serious disrepute.
3. (i) Members have a particular obligation to behave in a manner
which is consistent with their roles as public representatives and
legislators, save where there is a legitimate and sustainable
(ii) Members must interact with authorities involved with public
administration and the enforcement of the law in a manner which is
consistent with their roles as public representatives and legislators.
4. (i) Members must base their conduct on a consideration of the
public interest and are individually responsible for preventing
conflicts of interest.
(ii) Members must endeavour to arrange their private financial
affairs to prevent such conflicts of interest arising and must take all
reasonable steps to resolve any such conflict quickly and in a manner
which is in the best interests of the public.
5. (i) A conflict of interest exists where a Member participates in
or makes a decision in the execution of his or her office knowing that
it will improperly and dishonestly further his or her private financial
interest or another person's private financial interest directly or
(ii) A conflict of interest does not exist where the Member or other
person benefits only as a member of the general public or a broad class
6. Members may not solicit, accept or receive any financial benefit
or profit in exchange for promoting, or voting on, a Bill, a motion for a
resolution or order or any question put to the Dail or to any of its
7. Members must fulfil conscientiously the requirements of the Dail
and of the law in respect of the registration and declaration of
interests and, to assist them in so doing, should familiarise themselves
with the relevant legislation and guidelines published from time to
time by the Committee on Members' Interests and the Standards in Public
Office Commission as appropriate.
8. (i) Members must not accept a gift that may pose a conflict of
interest or which might interfere with the honest and impartial exercise
of their official duties.
(ii) Members may accept incidental gifts and customary hospitality.
9. In performing their official duties, Members must apply public
resources prudently and only for the purposes for which they are
10. Members must not use official information which is not in the
public domain, or information obtained in confidence in the course of
their official duties, for personal gain or the personal gain of others.
11. Members must co-operate with all Tribunals of Inquiry and other
bodies inquiring into matters of public importance established by the
Houses of the Oireachtas.
I thank the Ceann Comhairle for selecting this matter, the importance
of which is evident from the fact that four Deputies from County Kerry
have tabled it for topical issue debate.
I was angered by the decision of the Commission for Energy Regulation,
CER, to produce a report following a meeting in the Taoiseach’s office in the
week leading up to Christmas between the Taoiseach, the Minister for
Communications, Energy and Natural Resource, Deputy Rabbitte, the Minister for
Arts, Heritage and Gaeltacht Affairs, Deputy Deenihan and myself and Shannon
LNG at which there was a lengthy discussion on what further steps could be
taken to resolve this matter. Two solutions were identified, including that the
parties could sit down at a table and try to come up with a solution and
investigation of whether the complaint made to the EU Commission could be
suspended until such time as a consultation process had been concluded.
Unfortunately, neither happened.
The report issued last week by the CER ultimately determines the
framework upon which all further decisions on whether this project will go
ahead will be made. I come from a county and constituency which has enormous
unemployment. There has been much talk about export growth. This project could
result in more than $1 billion being brought into the country and the creation
of approximately 700 jobs. The McCarthy report, often condemned in this House,
states that this would provide fuel security. It further states that if we
increase the supply of energy to the country it should be possible to lower the
price. I acknowledge the interconnector between Ireland
and the UK,
which supplies 95% of our gas at a cost of €50 million per annum.
None of the solutions put forward suggest to me that this matter will
be resolved soon. This issue needs to be addressed in an open and transparent
manner. The date of 17 March was set as the deadline for finalisation of talks
on this matter. It is imperative that the regulator is brought before a
committee of the Oireachtas to explain why he produced a report which prefixes
a framework that could ultimately prevent this project going ahead. It is
essential that this matter is given urgent consideration as it could benefit
north Kerry, the county and the country.
I agree entirely with the points made by my colleague, Deputy Spring.
The raising of this important matter by four Deputies who represent County Kerry
demonstrates how critical it is. The bottom line is that jobs are at stake. A
fantastic announcement was made yesterday on the creation of 1,000 jobs in County Louth
through the establishment of PayPal. This project is its north Kerry
equivalent. A total of 650 construction jobs are associated with the project
and there would be a further 100 permanent jobs were it to proceed. Millions of
euro have already been invested in it and if it gets the go-ahead, up to €1
billion will be invested in the north Kerry economy. It is a no-brainer and
everything possible must be done to ensure it goes ahead. I call on the
Minister to take action and do everything in his power to ensure these jobs are
created. I emphasise that he must do everything in his power because one of the
major barriers to the project has been the lack of regulatory certainty, which
he can provide.
As a Deputy representing County
Kerry, I would be ashamed
if the project were not to proceed. Moreover, Members are not prepared to stand
by and let it slip through their fingers because it is too important for those
awaiting jobs who perceive it as a ray of hope. Some 17,500 people are on the
live register in the county and the project would help to reduce that number
considerably. It would alo provide a stimulus for the entire economy of north
Kerry and west Limerick. The Minister must,
therefore, step up to the mark and do what he can to ensure the project gets
the go-ahead and deliver a good news story for County Kerry.
In conjunction with my colleagues from County Kerry,
I have brought this brought to the Minister’s attention in the hope he can
resolve the outstanding matters. As Deputies Spring and Griffin have stated, the project involves
approximately 750 jobs, of which 650 would be created in the construction
phase. A further 100 permanent jobs would be created thereafter.
Last Friday the Commission for Energy Regulation, CER, published a
draft recommendation on tariffs for gas interconnectors which would apply to
companies such as Shannon LNG which states it will not use them. A public
consultation process is ongoing and at last Monday’s meeting of Kerry County
Council Mr. Paddy Power of Shannon LNG told the council that the move
constituted a fundamental change in Government policy. He stated it was akin to
turning up at a football match only to be told one would be playing a game of
hurling. This issue must be resolved. I suggest both the Minister and the
Taoiseach meet all Deputies from the county as soon as possible. County Kerry
is one of the country’s black spots; the North Kerry constituency has an
unemployment rate of more than 26%. Consequently, it is in urgent need of an
input to try to create jobs as young people are being lost on a daily basis.
Current developments at Tarbert and Ballylongford are matters that can be
resolved politically by a change of policy, if that is what it takes, to ensure
jobs are attracted to that part of the county.
I reiterate that I will work with my fellow Deputies, all of whom are
wearing the Kerry jersey in this instance and the Irish jersey in respect of
job creation. It is essential that this matter be sorted out and if that
requires the banging together of heads around the table, so be it. However, matters
must not be allowed to continue as they are. The issue is limping on from week
to week and there is no light at the end of the tunnel, only speculation.
Consequently, the matter must be resolved. Were Members to work together
politically, this could be done. I again express my hope the Minister can
arrange an urgent meeting with the Deputies from the constituency, as well as
the Senators from County
This matter pertains to the huge investment proposed in the project
mentioned - €600 million in the terminal and €400 million in the power plant.
At a time when we are trying to entice investment from throughout the world, it
is mind-boggling that we are looking at a gift horse in the mouth and shying
away from it in the form of this €1 billion investment. As the other Deputies
noted, the south-west corner of Ireland
has been devastated by unemployment. It certainly is a black spot that has been
overlooked in many respects during the years by IDA Ireland in the main, as
well as by the other job creation agencies.
The saga of the Shannon and Tarbert land bank is ongoing and there
have been many false dawns. Several projects were proposed, but they fell apart
and nothing of significance has taken place. The project mentioned is the most
feasible that has been put forward to date. What is ironic is that the
Government set out the rules in 2001, following a debate at the Cabinet, to
comply with European Union gas directives and encourage new and secure sources
of gas supplies in a free and open market with no obstacles attached.
Subsequently, however, the Commission for Energy Regulation made proposals that
would result in a substantial proportion of the interconnection charges imposed
on the direction of the energy regulator being levied on gas suppliers. Consequently,
suppliers such as Shannon LNG, Corrib and Kinsale Gas were greatly affected.
The Tarbert project certainly would take the main hit in this regard because
the other probably have been exhausted. Moreover, when reviewing the proposals
made by the Commission for Energy Regulation, the economist Colm McCarthy
concluded that they were not consistent with its cost-reducing remit on energy
policy. In other words, this meant they were bad for the householder, the
consumer and business in general. The Minister should intervene in this regard.
He has the power to so do and could issue a Government policy directive to turn
things around and rescue the project because otherwise it will be lost.
of Communications, Energy and Natural Resources; Dublin South West, Labour) Link to this
I thank the four Deputies for again giving me the opportunity to
address Members of the House on this important issue. I have consistently
welcomed the proposal by Shannon LNG to construct a liquefied natural gas, LNG,
terminal near Ballylongford, County
Kerry. Such a facility,
together with the bringing onshore of Corrib gas, would provide important
additional security in providing a gas supply for Ireland. I met the promoters of the
project soon after taking office last year and both my Department and the
Commission for Energy Regulation are in regular contact with Shannon LNG. Most
recently, the Taoiseach, the Minister for Arts, Heritage and Gaeltacht Affairs,
Deputy Deenihan, Deputy Spring and I met its representatives on 21 December.
The meeting offered a timely opportunity to review the state of play on the
project and underline the Government’s positive interest in the potential
The meeting also discussed the central concern of Shannon LNG, to
obtain regulatory certainty at the earliest opportunity on future pricing and
the treatment of Ireland’s
two gas interconnectors. Together with all players and potential players in Ireland’s gas
market, Shannon LNG has a key commercial interest in the outcome of the
regulator’s ultimate decision on this highly complex regulatory question and
given the complexities involved, there are many perspectives on what the
decision should be. The regulator has been engaged in an extensive consultation
process on the matter for the last few months and has had considerable
interaction with Shannon LNG, as well as with all key stakeholders.
In line with the stated need for all interested parties, including
Shannon LNG, to have clarity and certainty on the future regulatory regime as
soon as possible, the regulator originally had signalled it would come to a
decision last autumn. Unfortunately, the process was delayed by Shannon LNG’s
own decision to lodge a number of complaints with the European Commission.
This further delay in the process was discussed with Shannon LNG at
the meeting on 21 December, as was Shannon LNG’s own particular perspective on
the regulatory issues for decision by CER.
Decisions on the regulatory treatment of the gas interconnectors and
tariffing are statutorily a matter for the CER under the Gas (Interim)
(Regulation) Act 2002. I have no function in the matter. As the independent
energy regulator, the CER has a remit to protect energy consumers, to ensure
security of supply and to support competitiveness. It also has a duty to ensure
that new sources of gas for the Irish market do not result in unwarranted
increases in the price of gas to business and domestic consumers.
I understand that on 17 February, the CER published a proposed
decision paper - its normal way of going about something like this - on the
regulatory treatment of the gas interconnectors. The regulator has announced
that it intends to hold one further public forum for stakeholders on 1 March.
Given the multiplicity of perspectives on the matter, I am sure all
stakeholders, including Shannon LNG, will welcome such a forum. In tandem,
stakeholders have the opportunity to respond to the regulator by 16 March on
the matters raised in the proposed decision paper. At the end of this period, the
regulator will assess all comments received and publish a final decision. I
understand the regulator expects a final decision to be available by end April.
I would hope the regulator will improve on that date. The regulator’s final
decision will bring the regulatory certainty which Shannon LNG has repeatedly
I thank the Minister for his reply. I acknowledge that the forum on 1
March will be welcomed by Shannon LNG. However, the mantra of this Government
for the past 12 months is that we want to create jobs for our people and that
we want to do everything in our power to make sure we reduce the unacceptable
number of more than 400,000 people on the live register. Quite frankly, there
needs to be greater intervention by the Minister in this matter. I do not feel
it is good enough for him to come in here and tell us this is a matter for the
energy regulator. He needs to directly intervene in this and guarantee these
jobs for north Kerry.
This is a crucial matter for us. We need certainty as does the
company. Our international reputation is at stake. When a company has expressed
so much interest in our country and has already invested so much money, the
Government needs to welcome that interest and show of solidarity with the Irish
people. That is what I am asking the Minister to do.
An increased supply on the market surely should be good for
competition rather than bad for competition. That is something that should be
borne in mind.
I thank the Minister for his detailed response, but we have gone no
further. There is an impasse here and we have to find a way to break it. The
Minister mentioned Shannon LNG’s own decision to lodge a number of complaints
with the European Commission. As I read the rest of his speech, that is not the
reason for holding things up. The proposal to have an opportunity to respond to
the CER by 16 March is in the proposed decision paper.
If the political will exists - there is collective political will from
all parties in respect of job creation and from a parochial point of view in
trying to get jobs into Kerry - this must be overcome. Both the Minister and
the Taoiseach have a role to play in this. Much was said at that meeting last
Monday. I referred to a €75 million tariff. Is that true or is it just wild
speculation? If that is the case, it will ensure it effectively will not
I am in agreement with the Deputies. There is an essential need for
the Government to intervene. I cannot see anything positive coming out of the
process here, whereby stakeholders will make further submissions by 1 March. We
are going around the house and back to square one again. The importance of this
cannot be over-emphasised. We are being told on a weekly basis about our high
energy costs for attracting industry and maintaining businesses. Our
electricity costs are enormously high even to the householder when compared to
the European average.
Perhaps we need to look at EU legislation and regulations. We need to
circumvent this in some way, and that is what government is for. We are here as
elected representatives for our county, and this is one of the most essential
matters that has come before the House in the past 12 months. We should examine
every avenue possible to find ways and means to overcome the impasse. There is
a huge responsibility on all of us to reach a resolution as soon as possible.
Time is of the essence and I ask the Minister and the Government to examine
of Communications, Energy and Natural Resources; Dublin South West, Labour) Link to this
I thank the Deputies and I share their concern to grow employment in
Kerry. However, Deputy Griffin is essentially asking me to ignore the statute,
and the other Deputies seem to concur. Perhaps the House should take greater
care when passing a law like this, but the House passed the law and Deputy
Griffin is asking me to break the law. I cannot do that, but within the
constraints imposed on me by the law, I have done everything that is humanly
possible to mediate the earliest possible outcome to this issue. We would have
had an outcome, as promised by the regulator, last autumn. However, for reasons
that it explained at our meeting on 21 December, the company decided to appeal
to Europe against a decision that was not yet
made and as a result, disabled the issuing of a decision last autumn.
At our meeting on 21 December, the Taoiseach, the Minister for Arts,
Heritage and the Gaeltacht and Deputy Spring met with the promoters and the
American representative. They asked for a forum and they are getting a forum.
It is normal practice for the regulator to publish this kind of paper in
advance. Let the stakeholders go along to that forum for however long it lasts
and let them effect the changes that are deemed sensible.
Under the regulatory regime, once utilisation of the interconnector
decreases due to new sources of supply, the price per unit of gas transported
through the interconnector will increase. Therefore, in addition to its
consumer protection remit, the regulator also has a competitiveness and a
security of supply remit. Whatever regime is put in place for the
interconnectors, it is important for all stakeholders that it should be fit for
purpose. In other words, there was a huge investment by the State in the
interconnectors between here and the neighbouring island. We cannot strand
those assets. They have to be remunerated. The final sentence of the executive
summary to the paper published by the regulator reads:
The CER has concluded that the
current regulatory treatment of the BGE gas interconnectors with GB will no
longer be fit for purpose when new sources of gas come on stream. [It is
referring to the Corrib and to the LNG project in this regard] If the system is
unchanged, it will result in significantly higher gas tariffs to all gas
customers, and will distort efficient economic signals for the future use of
the transmission system.
It is the job of the CER to address such issues. It is the task of LNG
and other interested parties to attend the forum and influence the ultimate
decision. The CER has produced a draft decision, that is all.
I understand the concern that exists in Kerry with regard to jobs.
Interest in this issue is whipped up every so often. I assure the Deputies that
there is no lack of engagement in respect of this matter. I have pushed the law
to the boundaries. The Minister for Arts, Heritage and Gaeltacht Affairs,
Deputy Deenihan, and Deputies Spring, Griffin,
Martin Ferris and Tom Fleming are all interested in this matter. I understand
that but I am constrained with regard to how far I can go. I hope that on this
occasion the regulator will be permitted to do its job and bring the issue to
Question 135: To ask
the Minister for Communications, Energy and Natural Resources if he will apply
ministerial direction to a matter (details
supplied); and if he will make a statement on the matter. [13016/12]
of Communications, Energy and Natural Resources; Dublin South West, Labour)
I refer the Deputy to previous replies to Parliamentary Questions on
this matter. The decision on the regulatory treatment of the gas
interconnectors is statutorily a matter for the Commission for Energy Regulation
(CER) under the Gas (Interim) (Regulation) Act 2002. I have no function in the
matter. The CER, as the independent energy regulator has a remit to protect
energy consumers, ensure security of supply and support competitiveness. In
particular it must ensure that new sources of gas for the Irish market do not
result in unwarranted increases in the price of gas to business and domestic
There have been requests, from Shannon LNG and others, to me as
Minister for Communications, Energy and Natural Resources to issue a policy
direction to the CER in accordance with powers of direction as provided under
Section 10A of the Electricity Regulation Act 1999. The content of such a
policy direction has not been specified by the advocates but it appears the intention
is that a Ministerial direction could be used to intervene to influence CER’s
decision making about the regulatory treatment of the gas interconnectors, in
particular with reference to the imposition of a tariff on this project, on the
basis that Shannon LNG alleges that the decision is, in their view, set to
damage its future business.
The 2002 Act confers specific legislative powers on the CER to
regulate and determine the tariffs applicable to the gas transmission system.
By law, the CER makes decisions pursuant to these powers independently of the
Minister. These laws reflect the policy that determining tariffs is not a
matter for the Minister.
Furthermore, Section 10A of the 1999 Act does not provide an adequate
legal basis for a direction sought by and for the benefit of a private entity.
The section provides that the Minister may only give directions on ’general
policy’ as opposed to a specific direction in respect of the making of a
particular decision by the regulator. Section 10A (6) (c) of the 1999 Act
explicitly prohibits the Minister from giving a direction in respect of the
performance of the functions of the CER ’in relation to individual energy
undertakings or persons’.
I am satisfied that any general policy direction I might make would
have to operate in what I consider to be in the overall public interest and
could not be framed so as to either assist or hinder a particular stakeholder
or otherwise so as to undermine the regulatory system. In the absence of any
change in policy in respect of the regulation of gas tariffs, which I do not
contemplate, and because of the limitations set out in the governing
legislation surrounding the exercise of this power, I do not envisage making a
Ministerial policy direction as sought by and on behalf of the company.