HC Deb 15 July 1988 vol 137 cc365-6W
Mr. Cran

To ask the Secretary of State for Northern Ireland if he will make a statement on the future generation of electricity in Northern Ireland.

Mr. Viggers

In 1985 the Government identified the need for new generating capacity to be available in Northern Ireland from the mid-1990s. Tenders were invited from NIE and the private sector to find the most cost-effective way of meeting this requirement, taking account of the availability of indigenous lignite deposits.

The main options were a public or private sector lignite-fired station or the installation of generating sets 3 and 4 at the Kilroot power station (known as Kilroot phase II) as dual coal/oil-fired units.

In the event, the particular circumstances of the availability of spare plant already purchased but not yet installed, together with the lower levels of coal and oil prices that are now forecast, made the option of proceeding with Kilroot II the most economical outcome.

The Government have therefore decided that the requirement for new generating capacity in Northern Ireland will be met by Kilroot phase II.

There is strong evidence, however, that had the particular circumstance of the lower capital cost not existed, a lignite station would otherwise have had significant advantages and therefore the next power station in Northern Ireland is likely to be lignite-fired.

This view is reinforced by the positive approach evident in the proposals submitted by the private sector for a lignite-fired power station, and in particular in that from the Antrim Power Company Limited, which emerged as much the strongest private sector group.

The Government are determined that the benefits from private sector involvement in the electricity supply industry should be available to Northern Ireland consumers as they will be to those in the rest of the United Kingdom. They therefore propose to set in hand immediately consideration of ways of privatising the Northern Ireland electricity system.

In the appraisal of these options the Government have been advised by Coopers and Lybrand Associates Limited (with Ewbank Preece Power and Water Limited) on economic and technical issues, N. M. Rothschild and Son Limited on financial matters, Denton Hall Burgin and Warrens, solicitors,on legal and contractural matters, and Dr. Otto Gold GMBH on lignite mining.