THE ESB confirmed yesterday that it is bidding to buy Northern Ireland’s electricity transmission network in a move that would give it ownership of the island’s two power grids.
The State-owned energy company already owns, but does not manage, the Republic’s national grid, the network that transmits electricity from generators to customers.
It confirmed yesterday that it is in talks with Belfast-based Virdian to buy Northern Ireland Electricity (NIE), which owns the grid that transmits power across the six counties.
If it were to succeed in buying NIE, which has a price tag estimated at €1.4 billion, it would give the State company ownership of both grids, which are already interconnected and part of a single electricity market.
Last year, NIE generated revenues of almost €107 million and generated profits of over €40 million.
Following speculation at the weekend, both parties yesterday issued statements confirming that talks were under way.
Both made it clear that the discussions were at an early stage and said that they may or may not lead to a deal being done.
The ESB and Viridian compete with each other to supply electricity to commercial and industrial customers throughout Ireland. The electricity markets on both sides of the island were merged in late 2007.
Along with NIE, Viridian owns Huntstown Power, which operates two power plants in Dublin and Energia, which supplies both electricity and gas to its customers.
The ESB is the biggest operator in the Republic’s domestic market and supplies electricity to commercial customers. It is developing a large alternative energy business and has an international division.
While both companies own the transmission networks, they do not operate them. Another State body, Eirgrid, operates the Republic’s national grid, while the System Operator Northern Ireland (SONI), which Eirgrid bought last year, manages the network in the north.
Viridian’s ultimate parent is Arcapita, a banking, private equity and investment fund business owned by the state of Bahrain.
Arcapita sought to sell Viridian two years ago, and attracted bids from State-owned Bord Gáis and Spanish operator Endesa, which has a number of power plants in the Republic.
At the time, the company, including NIE, Huntstown and its other businesses, was said to be worth a total of at least €2 billion.
Both parties subsequently walked away and Arcapita took Viridian off the market.
