A new decree by Ireland’s telecoms regulator could knock tens or even hundreds of millions of euro off the price of the state’s €3bn National Broadband Plan (NBP) bill.
Comreg has issued a draft decision that is likely to cut the €900m fee that the NBP must pay to Eir for access to the company’s rural poles and ducts.
The regulator says that the cost of access to Eir’s infrastructure -- €900m over the 25-year term of the NBP contract -- may be unrealistically high, because it is based on a pricing level set for much smaller, short-term commercial contracts.
By comparison, the scale of access needed, as well as the relative stability of the funding and long length of the National Broadband Plan contract, means that it would be fairer for Eir to pitch its access price lower.
“ComReg proposes to draw a distinction between, on the one hand, generic access for CEI [Civil Engineering Infrastructure], and on the other hand, CEI access by NBI [National Broadband Ireland] for the purposes of the NBP. This distinction is proposed having regard to the significant differences between these two types of access,” said Comreg in its draft decision.
The draft decision will now be subject to submissions and counter proposals.
A spokesperson for Eir said that the company would study the draft decision.
A spokeswoman for National Broadband Ireland declined to comment specifically on the matter, saying that the issue was a question for the Department of Communications, Climate Action & Environment. A spokesman for that Department declined to comment specifically on the issue.
Comreg’s move comes after the government confirmed that Covid-related disruption will not qualify as “contingency” factors to access any of the €480m budgeted for unexpected obstacles. The contract between the government and National Broadband Ireland is made up of €2.1bn plus a €480m “contingency” fund, as well as Vat consideration.
If this is not drawn down over the lifetime of the contract, it could see the final public bill settle at around €2bn rather than the €3bn budgeted.
Separately, the Department of Communications has confirmed that the person appointed by the government to the board of National Broadband Ireland is Coillte chairperson, Bernie Gray. Ms Gray, is a management consultant and executive coach, is an accountant who held a number of senior management posts in Eir and is a former chairperson of Eirgrid. She is also a member of the Accountability Board of the Civil Service and the Governing Authority of DCU.
Meanwhile, the first community ‘broadband connection points’ are to go live to the public in the coming weeks, according to a number of regional broadband officers.
There are currently over 250 such points established in community centres, sports clubs and schools in rural areas.
The chairman of the National Broadband Plan company says that the €3bn state-subsidised project may now be completed in five years rather than the seven years initially agreed under contract with the government.
Communication Minister Eamon Ryan has been pressing Mr McCourt’s National Broadband Ireland (NBI) consortium to move more quickly in connecting up to 540,000 rural homes and businesses to high-end fibre.
Under the existing terms of the NBP agreement, 115,000 rural premises are to be ‘passed’ by the fibre broadband network by the end of 2021, with between 70,000 to 100,000 premises connected for each of the five years after that.