05/04/2006

NIE customers face further price hike

Northern Ireland Electricity customers could face a 3% rise in bills over the next three years, as a result of one of the main privately owned power stations being converted to be more environmentally friendly.

AES, who own the Kilroot station in Carrickfergus have been given permission to pass on the £35 million charge onto NIE to cover the cost of the installation of equipment to reduce sulphur dioxide emissions, after being instructed by the EU to either do so or shut down.

The passing on of the costs follows a long-running dispute over who should pay the clean-up costs at the coal-fired Kilroot power station. NIE argued that Kilroot's US owners AES should foot the bill for improving its own power station but industry authorities decided in AES' favour, therefore NIE consumers will have the bill passed onto them.

Under the terms of the privatisation of the power station in 1993, Kilroot was granted a contract to supply NIE until at least 2010. This meant that they would be able to claim the cost of the clean up, installing a gas desulphurisation flue, under the terms of the contract.

AES Kilroot Managing Director Derek Paton has said the move was in line with other power plant operators in Great Britain, Ireland and Western Europe.

He said that Kilroot has made proposals to NIE to allow the costs to be spread through time, which would result in a substantial reduction in electricity prices to the consumer.

He added that this has been rejected by NIE.

Robin Greer of NIE said that this was a very disappointing result for customers in Northern Ireland.

He said: "We do not agree that this is the right result, but we seem to be left with no option other than to reflect the estimated £35 million cost on to tariffs."

Mr Greer continued that the increase was "unwelcome," especially so soon after the company announced that they had been forced to put up prices by almost 11%.

It is understood that the £35 million will be recovered through the increase in bills between January 2008 and November 2010.

(EF/SP)

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