Kilroot power station owners made £9m profit

Kilroot under threat of closure
Kilroot under threat of closure

An energy company whose Co Antrim workers are threatened with redundancy made £9 million profit in 2016.

Around 240 posts at Kilroot coal-fired power station could go in May after the plant lost out on an all-Ireland contract to supply electricity.

Kilroot owners AES told the Northern Ireland Affairs Committee of MPs no dividends had been paid from their multimillion-pound profits, and the money had been reinvested in the business.

Capacity payments are made to generators which are available to generate and helps safeguard supply.

Under changes to the Single Electricity Market, generators will only get this payment if they actually provide the generation required.

Utility Regulator chief executive Jenny Pyper said: “It has been described to me by business representatives as a nice little earner, it has been a top-up payment.”

She said the world had changed.

“Why should consumers pay, and pay a premium payment for plant that is not needed?”

“We need to have a best in class, modern, efficient competitive market and that is one that is needed to be based on competition, not on stable, nice little earners.”

Kilroot lost its bid during the first auction of the new all-island electricity market as part of reforms intended to increase competition and lower consumer prices.

However, the committee also heard that the decision to close the station presented a serious problem for the local council

Chief executive, Anne Donaghy said Mid and East Antrim Borough Council was looking at a loss of £1.3 million from the borough’s largest rate-payer. That, she said, represented the funds required for running its three leisure centres, leaving the council looking for ways to reduce services.

AES UK and Ireland president Ian Luney also refuted Ms Pyper’s assertion.

“Capacity... has not been a nice little earner, it was absolutely essential to ensure that we covered our costs.”

While confirming £9 million profit in 2016, he said profit margins had “diminished” with the risk some costs would not be covered and warned of bankruptcy fears.

He added: “That is not sustainable after May 23.

“We cannot just hang on, we have not got the reserves to do it, we have not got the ability to do it and we would be bankrupting the company if we did that.”