They turfed Eddie out of Bord na Móna — take a look at him now

What O’Connor really wanted to do was explore options for renewable energy sources...

There was little talk of climate change or of oil depletion in those days. What he wanted to do (and the risks involved) scared the mandarins who retained control over Bord na Móna

IN SELLING Airtricity for nearly €2.2 billion — and in becoming up to €50 million richer personally — the former Bord na Móna boss, Eddie O’Connor, has shown those who ousted him from his old job at the semi-state company just how wrong and pig-headed they were.

O’Connor is due to get the money as one of the beneficiaries of the sale of the renewable energy and wind farm company to the much bigger Scottish and Southern Energy (SSE).

He owns about 3% of the company he started — having ceded control to raise money from other investors for necessary expansion — but it is his baby, just a decade old. Other people’s money was needed at stages along the road — about €450m in total — but the company would not have been born or have grown without his ambition, imagination, drive and willingness to take risks.

The story is a great success, but it is also a missed opportunity for the State and is damning of the then rainbow government of FG, Labour and Democratic Left.

O’Connor’s ambitions to create something big and brilliant could have been sated within Bord na Móna if the envy and suspicion of his masters could have been set aside. The story of how he was done down is shameful, just as the story of how he succeeded is inspiring.

He had an enviable track record at the company he joined from ESB in 1987.

His job at Bord na Móna seemed impossible, but he saved it from extinction by being brave enough to take unpopular but necessary decisions to reduce its costs, mainly restrictive practices put in place wrongly to satisfy the unions.

Bord na Móna was losing £16m a year at the time he took it over. By the time he was shafted a decade ago, it was making profits of £6m annually, but that was only the starting point for what O’Connor wanted to do. He realised that there was only a limited future for providing turf for electricity generation or home heating. He diversified into other related areas, but their potential was limited.

What he really wanted to do was explore options for renewable energy sources, windfarming and other alternative energy supplies. He was well ahead of his time in wanting to do that. There was little talk of climate change or of oil depletion in those days. What he wanted to do — and the risks involved — scared the mandarins who retained control over Bord na Móna.

His pleas for extra money and, more importantly, to develop the business with freedom rather than according to the whims of public servants and ministers who didn’t understand what he was up, and who did not want to take chances, fell on deaf ears. In 1996 a frustrated O’Connor made a speech to an audience of business people in Dublin. In it he criticised the “dead hand” of government and Department of Energy officials. It did not amuse those members of the audience at whom it was aimed.

Things were made worse a couple of days later. A friend of O’Connor’s sent a copy of the speech to me. I was the business editor of the Irish Independent at the time and I devoted a considerable amount of space to reporting what O’Connor had said.

As I was to learn soon afterwards, this enraged many powerful vested interests. They decided he deserved to be taught a “lesson” for displaying such cheek. Unfortunately, he had a vulnerable spot.

In his speech, O’Connor had also complained about his salary especially by comparison with many private company owners (many of whom had done a fraction of what he had achieved). He believed that many of his colleagues were rewarded insufficiently as well, that if state-owned enterprises wanted to attract and retain the best managers they would have to pay more.

He took matters into his own hands, making sure they and he wined and dined in fine restaurants and went on good holidays as a form of non-monetary compensation.

Elements in Bord na Móna, who I believe were colluding with certain politicians in the rainbow government, decided to move against him. A document outlining details of his alleged misdemeanours was given to a Sunday newspaper. Not surprisingly, it published these, given the authority of the sources and the accuracy of the information leaked selectively.

The impact on O’Connor’s career was devastating. It created a political storm that elevated him to the front pages of the newspapers. To use a footballing analogy O’Connor was guilty of little more than a yellow card offence, but instead he ended up seeing red. The self-satisfied controllers of Bord na Móna ordered the new management to behave themselves.

What a foolish mistake that was. Bord na Móna remains in existence, but while it is a profitable company — clearing about €26m in its last financial year — it is not a significant one. Nobody is going to buy it from the State, let alone pay €2.2bn for it.

Meanwhile, O’Connor has prospered. If those conspirators thought he would fade into oblivion, they were very wrong. He is a remarkably ebullient and positive individual.

He is always bubbling with enthusiasm for ideas, especially when they are counter-intuitive and new. He is dismissive of naysayers. He is a doer, a risk taker. Others realised this and offered him money to set up in business for himself within weeks of leaving Bord na Móna.

The fruits of his labours are obvious. In the space of less than a decade he has created a €2bn company. But he did it with initial capital of a mere €635,000 and loans of less than €10m.

He toured the country finding sites for windfarms. He went offshore to harness the power of the wind by building turbines miles out to sea. He went to the US and developed a substantial business in windfarms in many states.

HE GOT little or no help from the State and had to face all sorts of objectors who didn’t want the sight or sound of the wind turbines in their neighbourhoods. He persuaded a host of investors to put massive amounts of money into the company, something the State would never have risked.

I don’t believe O’Connor is interested in gathering excessive wealth for himself. Few entrepreneurs allow themselves to have their shareholdings diluted to as little as 3% because they hate and fear the loss of control implied.

Indeed, given the choice, O’Connor would not be selling this company, notwithstanding the near €50m windfall. He wanted to organise a management buyout, supported by outside investors, to ensure he could remain in charge of driving the company forward. O’Connor isn’t talking publicly, but friends of his have told me that he is as much disappointed as excited that he has become rich.

The company continues to have enormous potential, as its new buyers obviously believe. While there are those who remain unconvinced that wind power will generate enough electricity to replace more than a small amount of fossil fuel-generated supplies, big organisations such as SSE are prepared to take that bet.

It could have been Bord na Móna. What a missed opportunity for the want of paying O’Connor a bit better when he was in charge. His story should be remembered when anyone cribs about the new pay for state chief executives announced this week.

The Last Word with Matt Cooper is broadcast on 100-102 Today FM, Monday to Friday, 4.30pm to 7pm.