ESB to invest €900m in British gas plant

The ESB is to invest €900m in building a 1,500MW gas-fired power plant in Britain.

A spokesperson for ESB Ireland said that the electricity company had engaged in a feasibility study for the construction of the project.

“ESB has commenced early technical and environmental studies to examine the feasibility of constructing a combined cycle gas turbine power station in Yorkshire.”

The project will require about 1,100 workers to complete the building of a modern combined-cycle gas turbine power station on a former chemical works site at Knottingley near Leeds. The plant will employ about 50 people once completed.

A spokesman for ESB International, Simon James, said the company believed the market conditions were correct for the construction of a new power plant.

“Final investment decisions are always made with reference to market conditions, but we believe there is a market for new gas plants on this timescale in the current market or the one that will be created by electricity market reform,” he said.

Britain faces a power capacity squeeze in the middle of this decade as polluting coal plants and ageing gas plants shut.

The British government also recently fixed a maximum carbon emissions level for power plants until 2045, meaning gas-fired plants, whose emissions generally fall below the set level, will not face new pollution limits for another 30 years, an issue which had previously left gas plant investors anxious.

Plant construction is expected to start in 2015 and Britain’s infrastructure planning body, which manages applications of large infrastructure projects, said it expected the project’s formal application in the first quarter of 2013.

ESB was given an investment grade rating in January by credit agencies. ESB obtained these ratings to access the international capital markets as a means to fund its €6.5bn expenditure programme.

— Reuters