Consumers to pay for storm damage to the electricity distribution network?

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mathepac

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I heard on the news that the government and the “ESB” (ESB NetWorks?) intend to bill consumers for the repair work carried out to the distribution network after the damage caused by recent storms. "Rather strange", I thought, as I believe that consumers, private and commercial, should be billing the Government and the ESB for their dreadful response to the damage, leaving tens of thousands of customers without electricity and/or water for such a protracted period, closing schools and businesses, and causing widespread inconvenience.

I discussed this with one of my neighbours and he came up with what I thought was a rather neat idea. He suggested that if the powers that be (pun intended) insist on making consumers pay, the consumers respond by striking; not by refusing to pay bills, but by cancelling their direct debits and payments via post offices and credit unions and also by cancelling their e-billing arrangements. The latter could in the short-term cost the consumers their 4% “pay-on-time” discount, but that could be recoverable or prevented if the proposal below was adopted. This consumer “strike” would cause ESB to process manual payment transactions and produce and post millions of paper bills. I thought to myself that would soften their coughs for them, and radically reduce their cash flow.

My neighbour came up with what I thought was an attractive counterproposal to prevent the ESB and government from developing any coughing fits. He proposes as follows:

Consumers agree to pay the repair cost but only on the following conditions:
  • The extra costs for repairs are ring-fenced into a special account and consumers are issued with special shares in the ESB up to the value of the repair costs
  • These special shares cannot be traded on the open market, but only between consumers or sold back to the ESB
  • Share earnings can be credited against the consumer ESB account or used to buy extra shares
  • The special shares carry the same or greater voting rights as those of institutional share-holders
  • Give consumer shareholders the choice of using the 4% pay-on-time bonus to buy more of the special shares or let them apply as now against their bimonthly bills
Any other views, other than having ESB and the government force their customers to pay for their ongoing extravagances, inefficiencies, and ineffectiveness over dacades?

mathepac on behalf of his non-AAM neighbour
 
Essentially, the proposal is that the ESB should finance the repair costs by issuing new shares of a special class but (a) ESB customers are required to buy the shares and (b) nobody else is allowed to buy them.

Currently the ESB has two shareholders; the state owns 95% of the issued shares, and the Trustees of the Employee Share Ownership Plan hold the other 5%. The shares are not listed on any stock exchange.

If you did issue new shares as suggested, you wouldn't need any rules about voting rights as compared to institutional shareholders, since there are no institutional shareholders. And, anyway, voting rights would be pretty well irrelevant; the issue of the new shares would reduce the state's holding somewhat, but the state would still be utterly dominant in any actual vote. The issue of shares wouldn't secure customers any meaningful degree of control.

I don't think you'd need rules about who the shares could or could not be sold to; there's no stock market listing and nobody would be interested in buying these shares privately — especially as they wouldn't pay cash dividends. (Why the ban on cash dividends, anyway?)

All in all, I'm not sure that this is a brilliant idea. It doesn't address the fundamental problem here, which is — taa-daa! — the challenge of climate change. Extreme weather events are going to become more extreme, and they are going to occur with greater frequency. This has already begun to happen, and the rate at which it happens will continue to intensify. As far as something like electricity distribution goes, this means we either suffer greater disruption of supply than in the past, or we invest more in the resilience of the system — strengthening the infrastructure so that it's more resistant to extreme weather conditions, or investing in the capacity to respond with greater speed and at greater scale to weather damage, or a bit of both. And, of course, more investment requires more funds. The key issue is not so much where to obtain those funds as how to spend them to best effect in maximising resilience. In particular if the funds come from customers of the system I don't think it makes much difference whether they come from higher charges, or from the forced purchase of, let's be honest, second-class shares in ESB.

The alternative to funds coming from customers is funds coming from taxpayers. "Customers of the system" and "taxpayers" are, of course, to a large extent the same group of people, but with taxpayer funds there's an agency, the government, which is at least better positioned that a large but disorganised group of very small shareholders would be to exert some outside influence to try and ensure that the funds are spend in the most efficient way to improve the system. This is something you presumably feel is needed, if you think part of the problem is the "extravagances, inefficiencies, and ineffectiveness" of the ESB.

So state funding, with agreement between the state and the ESB as to precisely which reslience measures are to be funded, may be the way to go.

[There'll be a state aid issue under EU law to be overcome. But that's a separate discussion.]
 
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mathepac said:
I heard on the news that the government and the “ESB” (ESB NetWorks?) intend to bill consumers for the repair work carried out to the distribution network after the damage caused by recent storms. "Rather strange",
Click to expand...
But is this not how it's been done all along, we the consumer pay for all of the infrastructure
And that's both funded from your monthly electricity bill or your yearly income tax
What I'd like to see done is the powers that be fix and improve the infostructure rather than just repairing it for it to happen next time
I think I heard MM in the Dáil say that this storm was a once in a hundred year event,
If that's the kind of stupidity that's running the country, it's time to do more than just cancel your direct debits!!
 
They've been claiming for years that extreme weather events are going to become more extreme and frequent, yet it never occurred to them to test the resilience of a electricity network that could be knocked out across wide swathes of the country by equally neglected forestry.

We're not paying these geniuses half enough. :D
 
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The people own the ESB.

Imposing any "penalty" on the ESB is imposing it on ourselves. So acting the blaggard with direct debits is just biting off our own noses to spite our collective faces.

This storm was unprecedented. Whole lines of poles were laid waste. It was not just a matter of tracing a single fault and fixing it. New lines had to be built, effectively from scratch.

Most people did not lose their electricity connection.
Most people who did, got it back in a few days.
And yes, today, two weeks later, a few thousand still have not got it back.

The ESB will have to review their resilience in the light of climate change. And yes, they, that is us, will have to pay for it.

Brendan
 
There are questions to be asked of the ESB around maintenance of poles and clearing of trees and forestry etc from their vicinity.
Many reports on social media of poles that came down because they were rotten, or customers who reported trees beside poles and ESB come out and just take off a few branches... and the tree came down in this storm taking out the pole.
 
Fully agree that there are questions to be asked and lessons to be learnt.

Any extreme event should result in learning for the ESB. And practices should be reviewed.

But the cost of any changes in practice will fall on us the consumer or us the taxpayer.

Brendan
 
There is an ash tree in our garden that sits on a hedge directly underneath a power line. Every year or so they come and cut a lump off it to stop it growing and hitting the power line. The tree is ugly at this stage and we'd much prefer they'd fell it and be done with it, but I've been told that if we want this, they'll charge us for the privilege.

This week we still have several neighbours without power owing to trees elsewhere in the locality falling onto power lines.

It sounds to me that the maintenance teams concentrated needlessly on easy jobs and neglected harder ones.
 
The important thing to remember here is that, despite the fact up to 57% of your remuneration is appropriated at source, and from the 43% left over you pay 9% VAT on electricity and public sector obligation levies as well as the cost of the energy itself, you should have absolutely zero expectation that anything other than a subsistence level of routine maintenance will be provided in return for those appropriations, and the cost of anything outside those routine boundaries will fall to you. Others here will be well equipped to school you should you be naive enough to question this state of affairs.
 
T McGibney said:
There is an ash tree in our garden that sits on a hedge directly underneath a power line.
Click to expand...
But if the tree is in your garden, why can't you pay a tree surgeon to fell it and save me having to pay to maintain it on an ongoing basis?

Living with the possibility of having live power lines fall in your garden must be a worry, why not fix it once and for all? Or is your attitude the same as the ESB's - "Ah shure it'll be another hundred years before we have to deal with that again"?
 
"But if the tree is in your garden, why can't you pay a tree surgeon to fell it and save me having to pay to maintain it on an ongoing basis?"

1. I have better ways to spend my money.
2. I haven't asked you or anyone to maintain it, but I will consider any third party offer to maintain or fell it once that's not going to cost me money.

"Living with the possibility of having live power lines fall in your garden must be a worry, why not fix it once and for all? Or is your attitude the same as the ESB's - "Ah shure it'll be another hundred years before we have to deal with that again"?"

The tree was there before my house was built and possibly before the power line was installed. And my "attitude" to any random issue is none of your business.
 
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T McGibney said:
They've been claiming for years that extreme weather events are going to become more extreme and frequent, yet it never occurred to them to test the resilience of a electricity network that could be knocked out across wide swathes of the country by equally neglected forestry.
Click to expand...
Also you would have to question all the money being spent on green energy and pso levys to pay for electric infrastructure for wind farms etc. Surely this should be spent on generators and the resilience of network. After all all the money spent on green energy will be wasted as the weather won't change anyway when China and trump and Putin are turning their backs on global energy transition
 
If the future really means more frequent and extreme weather events, one would indeed have to question the wisdom of building critical energy infrastructure on the tops of mountains or in open seas.
 
We the people seem to me to have already paid a high price for the ESB to do a lousy job. Is the consensus that it's OK for us to simply rinse and repeat?

Why should we continue to over-pay people who continue to do a lousy job? We also pay premium pensions to people who in the past have been paid exceptionally well to have done lousy work; zero planning and a minimum of routine maintenance to keep the system up and running safely seem to be routine. How do we get value for our money?

Depending on whose report you read, the average annual salary in the ESB in 2023 across their 8,200 employees was €78,000 pa. That seems excessive as an average salary, excluding perks and bonuses. For that kind of money, I’d have expected the storm damage to have affected less than several hundred thousand consumers at peak and there to be less than several thousand still without power two weeks later.
Is that unreasonable?

My neighbour’s spitball proposal was an attempt at clawing back some compensation for the massive inconvenience the ESB Group imposed on a significant percentage of the population. As an alternative to that, how about the next two year’s worth of contributions to the central pension fund from our bills gets paid back to the consumers who were worst affected for the poor job ESB Group has done in the past and are still doing today? That one is mine.

Average pay in the ESB Group
 
As a Dubliner living 80 metres ASL on an exposed, windswept peninsula in the SW of Ireland for the last 15 years, I have been massively impressed by the ESB's efforts to make our local electricity supply more resilient in the decade since we were devastated by Storm Darwin in February 2013*
We have survived every subsequent storm since - including the one described as the worst storm (Ophelia) to have hit Cork for 50 years- with little or no powers cuts, the worst of which was less than 12 hours' duration. So all in all, I reckon that the ESB aren't doing a bad job, regardless of the howling of the banshees on RTE and the opposition benches.

I'm sure that lessons will be learned from the latest "once in a century" storm and I have sympathy for the people affected - I can certainly feel their pain - and so on, but I also believe that only a fool would think that man will ever be able to master nature at its most extreme.


* No power for 8 days, no heat, no water, no hot showers, no flushy toilets, no morning cup of latte macchiato, no Morning Ireland or Joe Duffy to tell us how miserable we should be feeling, all of the food in the freezer having to be thrown out, no internet, no online banking, no blah blah blah!)
 
I’d be happy if the standing charge for rural customers was increased. Specifically people who like to live hundreds of metres from their neighbours and rely on electricity wires strung on poles which are vulnerable to high winds.

There was very little damage in urban areas like mine with underground cabling.
 
@Marsupial, I'm delighted to hear you escaped the worst of the ravages, however, hundreds of thousands didn't and I believe they are entitled to be compensated for that and the chaotic recovery services ESB has offered but not yet completed. For the record, my power cut was a couple of seconds in duration.
 
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