31 January 20000

 

MINISTER WELCOMES NORTH-SOUTH GAS MARKET TESTING INITIATIVE

Sir Reg Empey, MLA, Minister for Enterprise, Trade and Investment today welcomed the announcement by Premier Transco to test the market demand for gas-fired electricity generation in the Republic of Ireland as a basis for private sector investment in a possible North-South gas pipeline.

The Minister said: "I have noted with considerable interest Premier Transco’s initiative aimed at testing the electricity generation market demand for gas in the Republic to see if it would justify commercial investment in a possible North-South pipeline. Much depends on the market response to this initiative and I will be interested to see the outcome."

Since Government announced its intention to progress development of an all-island energy market in concert with the Republic of Ireland in July 1999, the Minister has had further discussions with Ministers Mary O’Rourke and Joe Jacob in the Republic of Ireland, and this commercial initiative complements the thrust of developing policy.

The Minister said: "In Vision 2010 we indicated that development of the energy market was likely to take place in an all-island context. Today’s announcement shows that this is the case, as does the progressive opening of the electricity markets North and South, the current projects being undertaken by NIE and ESB to strengthen electricity interconnection, and the work of the Regulators in developing new North/South trading arrangements."

Emphasising that there were other commercial interests with licence applications currently lodged with OFREG for possible pipeline developments both North/South and to the North and North West, the Minister pointed out the damaging effect which introduction of the Climate Change Levy in Northern Ireland would have in the event of any such developments.

The Minister said: "Private sector developers have indicated that if the Levy is introduced in Northern Ireland on the industrial and commercial use of gas it would make it uneconomic to distribute gas to towns from any gas transmission pipeline either to the South East or to the North West.

"That is why I have been pressing very hard for a modification of the Levy to take account of Northern Ireland’s unique energy market, where the gas industry is only just developing, and emphasising that the future development of that industry offers the best opportunity to deliver the environmental objectives of the Levy in Northern Ireland."