CER favours smart approach to latest utility metering attempt
Smart electricity meters are coming to Irish homes - every home in fact - by 2024. That is part of an audacious new plan announced by the Commission for Energy Regulation (CER) which will see ESB Networks install around 2.3 million smart meters over the next six years.
But before you get too excited, there is a catch. You will have to pay for your smart meter through network charges spread out over the lifetime of the meter.
Thankfully, according to CER, this will only amount to around €5.50 per bill annually over a 20-year period.
That implies a cost to the customer of just €110 per meter. This seems remarkably low given that in the UK, where these meters have been rolling out for some time, the cost can be £390.
However, it seems the CER wants to avoid some of the pitfalls of the UK model which has been supplier-led.
In other words, different providers are signing up different customers with different meters at different prices.
And it hasn't gone well over there. Initially, taking them was supposed to be compulsory, but the British government seem to have backed away from that. One Cambridge University academic writing in the Daily Telegraph asked why they would replace "meters that cost £15 and last for 50 years with new meters that cost £50 and last for 15 years".
Under the Irish plan, one company, ESB Networks, will handle the roll-out and the modest increase in network charges will cover the cost.
There are real benefits to using smart meters but there are some potential flies in the ointment. Accepting one won't be compulsory (think Irish Water) but there will have to be a major public information programme to convince people of the merits of what is going into their houses.
You won't need to have broadband. You can choose to opt in or opt out of having your data about electricity usage collected. But opt out and you won't the benefits or savings from using the meter. Furthermore, to cover this massive infrastructure investment, every household and business will pay the slightly higher network charges even if they haven't got the new meter yet.
ESB Networks has 90 years of infrastructure investment under its belt. But if it gets the numbers wrong on this one, it may have to go back to the CER in a few years looking to justify a higher network charge.
Is social media a new collective bargaining tool for pilots?
Technology is playing its own role in the Ryanair flights cancellation debacle. The company is rolling out a new app to show individual duty patterns, including days off to allow staff to select the period they wish to work.
But on the other side, pilots are using social media to communicate with each other and try to ratchet up a better deal from Ryanair. Pilots in Ryanair bases have been driving their own bargain, saying they won't accept a €12,000 pay-off to postpone holiday entitlements but want new contracts with better terms and conditions.
For Ryanair chief executive Michael O'Leary there cannot be a pilot work-to-rule because they are "not a trade union". However, all it takes is for enough pilots to agree to the same approach and drive a hard bargain.
O'Leary saw off the presence of trade unions 20 years ago with the famous baggage handlers' strike but perhaps some pilots are using 21st-century social media technology to organise for a different kind of collective bargaining.
The boss offered pay rises to some and not to others. "If pilots misbehave, that will be the end of the goodies," he said at the company AGM during the week, sounding a bit more 19th Century than 21st.
At least management, belatedly, came out and said what was wrong and how they were to blame. All it took was €1.9bn wiped off Ryanair's market value in a week.
'Steaks' high on EU beef deal
Big Phil Hogan was making all of the right noises down at the National Ploughing Championships. The European Commissioner for Agriculture emphasised how EU (and obviously Irish) markets would be protected from cheap beef imports as part of any trade deal currently being concluded between the EU and South American countries like Brazil and Argentina.
Hogan wants to keep the volume of beef allowed in from South America through tariff-rate quotas as low as possible. Raising recent beef scandals in Brazil, he referred to the EU's current requirement for 100pc inspections of beef products from Brazil at the point of entry to the EU.
He is absolutely right to raise this issue and seek to protect the interests of Irish beef producers. However, the UK has said it plans to do a raft of new trade deals with countries like Brazil after Brexit.
If the UK cuts a trade deal which didn't maintain a 100pc inspection regime on Brazilian beef entering the UK, customs checks on the lookout for Brazilian beef coming into Ireland would have to be posted along the border with the North.
How could a "frictionless" border function when Brazilian beef could freely enter Northern Ireland but would then have to be inspected and tariffed along the border?
No wonder farming groups here are calling for an immediate suspension of all trade talks between the EU and Mercosur (Latin American countries including Brazil and Argentina) until a final deal around Brexit has been agreed and signed-off.
Let's just say the 'steaks' are very high.
Growing up time for Toys R Us
American toy store chain Toys R Us, spectacularly crashed into Chapter 11 bankruptcy protection during the week. There are two versions of what went wrong for the firm that was bought out by private equity groups in 2005 in a $7.5bn deal.
Since then it has struggled. It lost $1bn in 2013 and was forking out $400m per year in interest to service its $5bn legacy debt.
One version says the debt burden was too much for what is otherwise a good business. The other version says it is being destroyed by the rise of online shopping and competitors like Amazon and Target in particular.
This assessment says it should have gone for liquidation and not Chapter 11 because it is a broken business that cannot be fixed.
Operations outside of the US, which include the UK, are not part of this Chapter 11, and are not affected. Management are trying to trade through the Christmas period by borrowing a further $2bn in special secured loans which ensure these lenders get paid first. It will be a tough call, because not lending it more money could see it fail.
Retailers in the US are being decimated by online shopping. Wal-Mart Stores recently spent $3.3bn on an online business and has bought three more. Retailers in the US sold just four high-yield bonds in 2017 worth $2.8bn, down from 28 bonds totalling $10.7bn just four years ago. Toys R Us is hoping to transition to a better online offering, having already invested over $100m on its website. But investors, still standing after this Chapter 11, will want to see debt reduction not investment.
Last year Amazon sold $4bn worth of toys, around a third of what Toys R Us sells in its 1,600 stores. Amazon toy sales were up 24pc, while the market was up 5pc and Toys R Us was down for the fifth year in a row.
This is serious growing-up time for Toys R Us.
Sunday Indo Business