Gas Networks Ireland breached terms of its licence

Gas Networks Ireland engaged in a “clear breach of trust” when it covered up the overrun on a pipeline project, the independent energy regulator has said.

Gas Networks Ireland breached terms of its licence

The Commission for Energy Regulation (CER) yesterday confirmed it had found that Gas Networks Ireland — formerly Bord Gáis Éireann — breached a number of the conditions of its Natural Gas Transmission Licence.

In December 2014, the Irish Examiner revealed that a former employee of the then-Bord Gáis Éireann had alleged an “act of serious financial impropriety” by a senior member of staff within Gas Networks Ireland.

The whistleblower alleged that the member of staff deliberately concealed from the board cost overruns owed to the contractor engaged to construct the Barnakyle to Coonagh West Gas Pipeline and that the monies owed to the contractor were subsequently paid through other gas infrastructure projects in Ireland in which the company was involved.

This was done without observing due process or the necessary approval by the then board of Bord Gáis Éireann.

The CER yesterday said it has determined that gas Networks Ireland “breached a number of the conditions of the licence that it held”.

“These actions were a clear breach of trust and the CER has taken steps to ensure that the effect of the breaches has been reversed in terms of any cost overruns being redistributed back to customers and to ensure that these breaches are not repeated,” commissioner Aoife MacEvilly said.

“In breaching its licence conditions, Gas Networks Ireland failed in its duty to supply accurate information to the CER to the detriment of its customers.

“The CER is taking a number of steps following this investigation.

“These include reinforcing our activities in monitoring licence compliance by Gas Networks Ireland and other operators and engaging with the Department of Communications, Energy and Natural Resources with a view to enhancing the regime for administrative sanctions, including the power to fine system operators or market participants in cases of non-compliance,” Ms MacEvilly said.

Earlier this month, it was revealed that Gas Networks Ireland was fined £500,000 (€644,122) by the Northern Ireland authority for the breach.

Responding at the time, a spokesperson for Gas Networks Ireland said the incident “was a clear breach of the company’s values and the company deeply regrets and apologies for this mis- allocation of costs”.

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