Green energy contracts to ESB understated

The Government understated the number of controversial green energy contracts awarded to ESB subsidiaries when it published the list of successful bidders this week.

It emerged yesterday that the State firm's subsidiary, Hibernian Wind Power, bought an individual project at Derrybrien, Loughrea, Co Galway, from Saorgus Energy, ESB International's partner in the Kish Consortium. The contract is to supply 60.35 megawatt (mw) of wind-generated electricity to Hibernian's parent, the ESB.

The Government's list of winners states that Saorgus is the operating company for the project. It was the biggest wind energy contract awarded. Industry sources estimated that it could earn €13.2 million a year in sales. This will bring the ESB's individual share of the contracts to a potential €37.3 million.

A spokesman for the Department of Communications, Marine and Natural Resources said it stated that Saorgus had won the contract as it was the original bidder, but added that Hibernian could operate Derrybrien, once it supplied electricity at the contract price.

"The change in ownership has not altered this in any material way," he said.

An ESB spokesman confirmed that Hibernian did not make the original bid for the project. He said it intended operating the facility and supplying electricity to its parent at the agreed price.

The Minister for Communications, Marine and Natural Resources, Mr Ahern, announced the awards on Wednesday. They were for the supply of green energy electricity to the ESB at a fixed price for 15 years. The contracts included large-scale wind electricity generation projects, which industry sources say could be worth €60.6 million a-year.

The ESB, through the Kish Consortium and its subsidiary, Hibernian Wind Power, was a major beneficiary.

Saorgus Energy, also took a large share of the awards. Between them, they were awarded contracts with an estimated value of €58.6 million a year. The ESB stressed yesterday that it does not own a stake or any other interest, in Saorgus.

The contracts included two offshore wind generation projects awarded to the Kish Consortium.These will generate 25 mw each and could be worth €11 million a year. The State company's competitors, including high-profile offshore player Airtricity, could seek a court order to stop the contracts being awarded to the ESB subsidiaries.

The Irish Wind Energy Association (IWEA) said yesterday that it was seeking legal advice about the Department's decision. Both Airtricity and Treasury Holdings subsidiary Eco Wind Power said they supported this move, but added it was too early to say what course of action they would eventually take.

An IWEA statement said it was also considering making a complaint to the Competition Authority and indicated that it was willing to take the issue to the European Court of Justice if necessary.