Archived press release

Kilroot - official complaint to Europe

4 April 2006

As the news broke of a decision to impose the full costs of modernisation equipment at Kilroot power station on beleaguered consumers, the American owned plant is about to find itself the subject of an investigation by the European Commission. Friends of the Earth today lodged an official complaint about Kilroot’s contract with NIE which the environmental group states gives the power station immunity from legislation to combat climate change.

Commenting on the decision to impose the full cost of sulphur removal equipment (FGD) on the consumer John Woods, Northern Ireland Director of Friends of the Earth, said,

“Kilroot is an elderly, inefficient and highly polluting coal-fired power station. It produces 20 per cent of Northern Ireland's carbon dioxide, the main gas responsible for climate change. We opposed the application to install Flue Gas Desulphurisation equipment because it will extend the life of the plant until 2025. Without this consent, it would have to close. This decision means that everyone in Northern Ireland is going to have to pay through the nose to extend the life of what is a cash-cow for Kilroot’s American owners [1]; an ever growing hole in the consumer’s pocket [2]; and a disaster for the environment.”

John Woods continued,

“At the heart of this issue lies the botched privatisation of electricity in Northern Ireland which gave Kilroot a long term contract that was not only a licence to print money but a permit to pollute at the consumer’s expense. The Government must accept responsibility for the fact that the contract allows the cost of compliance with environmental legislation to be passed on to the consumer. That is why we have lodged an official complaint about carbon dioxide pollution with the European Commission today.”

Friends of the Earth’s complaint [3] is centred on the fact that Kilroot’s contract gives it immunity from the EU Emissions Trading Scheme which imposes extra charges on power stations that emit high levels of carbon dioxide. Uniquely in the UK, Kilroot can pass these costs directly to the customer without fear of competition from other generators. NIE, on behalf of all of Northern Ireland’s domestic consumers, is contracted to Kilroot until at least 2010. Because the privatisation contract requires NIE to pay Kilroot approximately £60million a year whether any electricity is actually used or not, it is impossible for cleaner generators to enter the market at a competitive price.

John Woods concluded: “Tony Blair and Gordon Brown have told us that climate change is the gravest threat facing the planet. If they are serious the Government will act swiftly to bring Kilroot’s orgy of pollution at consumers’ expense to a timely end.”

Notes

[1] (back) AES Kilroot made £44 million operating profit on £117 million turnover - a 37.6% profit margin (Source: Belfast Telegraph Company Snapshot, Jan 2006. Referring to AES accounts to 2004)

[2] (back) £35 million cost equates to approx 2.5-3% on electricity tariffs for three years (Source: NIE)

[3] (back) Friends of the Earth's complaint can be found here (PDF format 72K).

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Friends of the Earth Northern Ireland
7 Donegall Street Place
BELFAST
BT1 2FN
Tel: 028 9023 3488
Fax: 028 9024 7556
Email: [email protected]

Published by Friends of the Earth Trust