The minister warned of an increase in gas prices due to the cost of a gas interconnector with Britain if the Shannon LNG (liquefied natural gas) project goes ahead at Tarbert, Co Kerry.
The Commissioner for Energy Regulation (CER) has told Shannon LNG it will have to pay a €10m tariff per year towards the operation and maintenance of gas interconnectors with Britain but the company is refusing, saying it will not use the interconnectors.
A decision from the commissioner is expected inside the next two months.
Speaking in the Dáil, Mr Rabbitte said in an environment in which gas from the Corrib field and LNG met some, or all, of Irish demand, the interconnectors built and owned by Bord Gáis Éireann would become under-utilised. With fewer customers to pay the €50m annual cost of the interconnectors, prices for consumers would rise, he said.
“We have no wish for prices to be pushed up as a result of a stranded asset, that is the interconnector, and a windfall profit to the multinationals, much as we welcome them here, whether they are associated with Corrib or LNG,” Mr Rabbitte told Sinn Féin TD Martin Ferris.
Yesterday, the Safety Before LNG group described Mr Rabbitte’s statement as a “dramatic game-changer”.
“Shannon LNG is hoping to make millions of euro profits every year with state support at the consumers’ expense at time of increasing fuel poverty,” said the action group. “From every angle looked at, be it environmental, safety, strategic planning or economic, the Shannon LNG project defies logic and is the wrong project in the wrong place and is against the strategic national interest.”
Meanwhile, Hess LNG chief executive Gordon Shearer said the tariff not only contravened EU law but represented a massive policy shift from the previous government’s stance on interconnector policy.