Mutual Energy Annual Report 2010Press Release - 4th March 2010
Mutual Energy Limited contributes to lower energy prices for eighth year
For the eighth year running, Mutual Energy Limited (formerly Northern Ireland Energy Holdings) will be able to avoid charging Northern Ireland customers directly for the costs of operating the Moyle Interconnector, the 500 megawatt subsea electricity connection between Scotland and Northern Ireland. In order to minimise electricity prices to consumers in the year April 2010 to March 2011 Mutual Energy has made the decision to allocate another substantial contribution from its Moyle Interconnector business reserves.
This year the company is leaving money in the pockets of Northern Ireland’s energy consumers with a contribution of £12.9 million, following up on a contribution of £11.9 million last year. This means the company has continued with its track record of keeping electricity prices to consumers significantly lower than they otherwise would have been.
The saving is in addition to the savings on the cost of capital associated with the mutualisation of the Moyle Interconnector, which are estimated to be approximately £18.6 million to the end of March 2010, a saving of nearly 26 per cent on the non-mutual case.
Commenting on Mutual Energy’s latest contribution to keeping electricity prices in Northern Ireland down, Chief Executive Paddy Larkin said “This announcement is good news for consumers because it means that the expected shortfall between our revenue and our costs in 2010/2011 will be funded by our reserves and not by increasing customer tariffs. In the current economic climate we are delighted to be in a position to provide this assistance to consumers. However this does mean that the £12.9 million contribution will not be available to provide other benefits to consumers.”
In explaining the figures he added “Considering our revenue outlook, although the interconnector is still essential for keeping the lights on in Northern Ireland, the Single Electricity Market does not adequately reward this security of supply. Additionally wholesale prices on each side of the interconnector are expected to converge further, which means our revenue linked to this price differential is decreasing.”
This latest contribution from Mutual Energy to minimising energy prices to Northern Ireland consumers follows on from the £1.9 million payback made in January as a result of operational savings in relation to the Scotland-Northern Ireland Gas Pipeline (SNIP), which is owned and operated by Premier Transmission Limited, part of the Mutual Energy group.
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Notes for editors
1. Mutual Energy Limited is a company limited by guarantee. Its principal objective is to own and operate energy infrastructure assets in the interests of the energy consumers of Northern Ireland. The company is a mutualised entity and therefore has no shareholders and its primary stakeholders are energy consumers
2. The Moyle Interconnector is the electricity link between Northern Ireland and Scotland which was mutualised in April 2003. It was acquired by former owners Viridian and refinanced on a £135 million 30 year bond.
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