Sunday 19 January 2020

McCarthy to examine overlap of semi-states

Emmet Oliver Deputy Business Editor

The duplication and overlapping activities of the four semi-states focused on energy -- ESB, Bord Gais, Bord Na Mona and Coillte -- is to be closely examined by the special group led by economist Colm McCarthy.

All four companies are ramping up their investments in renewable energy, mainly wind, but are likely to find themselves competing against each other for market share in the years ahead.

The McCarthy group may recommend that just one or two companies concentrate on this sector while other companies could be forced to sell their assets into the private sector.

Finance Minister Brian Lenihan has set up the special group to examine state assets and liabilities and to advise him on how the assets can be better used or disposed of. The pension liabilities of the semi-states and their contingent liabilities are expected to be closely examined, with the idea of pulling together a so-called "national balance sheet" of assets and liabilities.


The four energy-focused companies are involved in a range of joint ventures in the renewables and the potential (or dangers) of these joint ventures is expected to be probed by the McCarthy group.

However, the Green Party is very keen on renewables and the McCarthy group could meet resistance with any recommendation that the four companies hand over their renewable assets to private players. The ESB in particular has a very large green-energy programme.

The McCarthy group will focus initially on assets and liabilities in the commercial state sector.

The group has been asked to provide an interim report to the Finance Minister before the end of the year.

The other group members are Donal McNally, second secretary general of the Department of Finance; and Alan Matthews, professor of European Agricultural Policy at Trinity College Dublin.

McCarthy's group is examining virtually all state-owned enterprises, but most observers do not expect to see sell-offs of companies like RTE or An Post. The most valuable semi-state remains the ESB, particularly if its transmission assets are sold.

Bord Gais is seen as the most likely target for sale, as its cash- rich balance sheet and monopoly position in the networks area is likely to attract significant international interest.

Irish Independent

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