The Government has vowed to retain majority control of the ESB after it agreed to part-privatise the semi-state company to meet commitments under the EU/IMF bailout deal.
Communications Minister Pat Rabbitte said the Cabinet had signed off on the plan to sell a minority stake.
But facing criticisms that the move was a retrograde step, Mr Rabbitte said the electricity company would largely remain in state hands.
“There is no question of this Government handing over control,” Mr Rabbitte said.
Under the terms of the €85bn EU/IMF bailout deal, the Government must consider the privatisation of state assets.
But Mr Rabbitte said the Government wanted to get maximum value for the company, and ruled out a fire sale claiming the stake may not be sold this year or in the first quarter of 2012.
“It’s a very, very profitable company, but the implication is not, as I have said before, that we’re going to put it up on eBay next week. That’s not the intention,” he said.
Mr Rabbitte said the size of the stake to be put up for sale has yet to be decided.
The minister said it will be considered by a group of officials from the Departments of Communications, Energy and Natural Resources, Public Expenditure and Reform, Finance and the National Treasury Management Agency.
It will report back to the Government by the end of November.
Mr Rabbitte said he was not a fan of the bailout deal which he claimed was foisted upon the country, but said he was trying to get the economy back on track.
“I find myself in a position that I don’t want to be in, but I acknowledge that the survival of the viability of this economy is at risk, and that we have to make moves to ensure economic recovery and get people back to work,” he said.
ESB said the issue was a matter for the Government.
The Programme for Government stated up to €2bn must be raised from the sale of non-strategic state assets, drawing from the recommendations of a review by economist Colm McCarthy. He recommended the break-up and sale of both ESB and Bord Gáis.
Mr McCarthy called for the ESB’s electricity generation, supply and distribution businesses to be sold, but said the national grid should be retained in state ownership.
Mr Rabbitte said he was not in favour of breaking up specific aspects of the company and selling them off.
The Government’s quarter stake in Aer Lingus is also in the firing line, with Transport Minister Leo Varadkar saying he believed there was no longer a strategic case for the Government holding on to the share.
However, the airline’s low share price may mean that a sale offers minimal financial return compared with the billions the state needs.
ESB was set up in 1927 to control and develop Ireland’s electricity network.
It now operates seven thermal power stations and 10 hydro stations. The first, Ardnacrusha in Co Clare, was commissioned in 1929 and is Ireland’s largest river hydroelectric scheme. It is operated on a purpose-built canal connected to the River Shannon.
The firm has a dozen limited companies involved in the electricity network, telecoms, IT solutions and international energy and engineering projects.
It bought Northern Ireland Electricity from the Viridian Group last year for €1.2bn.
Latest figures from ESB revealed the company earned operating profits of €339m in 2010, generated cash from operations of €858m and made capital investments of €819m.
Sinn Féin communications spokesman Martin Ferris said part-privatising was a retrograde step and a “disaster in the long term”.
“Any sale of part of the ESB would be a disaster for consumers and ESB workers,” Mr Ferris said.
“There is no rationale for the decision other than that the Government is being pressurised by the IMF and EU to sell off state assets in order to service the debt.”
The Unite trade union said it plans to ballot its members at ESB for industrial action up to and including withdrawal of labour over the proposed sale.
A motion was passed unanimously by all delegates at the Biennial Conference of the ESB Group of Unions supporting the maintenance of ESB as a publicly-owned asset.
Jimmy Kelly, Unite regional security, said: “The will of the meeting was very clear that the short-term gain from a fire sale of the ESB is far outweighed by the loss of energy security, loss of dividend for the taxpayer and the loss of services such as we have seen this week in repairing the network in adverse conditions.
“As a result of today’s cabinet decision relating to the sale of some part of the ESB, we will now begin plans to ballot our members.”