Business

NIE announces £500 million 'overhaul' plan - with bills to rise by just £10

NETWORK: NIE has unveiled plans to invest over £500 million into its service over the next seven years
Andrew Madden

NORTHERN Ireland Electricity Networks (NIE) has unveiled a new plan to invest over £500 million that if implemented, will see the average household electricity bill rise by £10.The money is to be invested into the company over the next seven years.

The 176-page initiative has detailed how the power company, which owns Northern Ireland's electricity network, will hope to improve its service, safety and reliability across the region from October 2017 to March 2024.

NIE serves 860,000 customers in the north and since its privatisation has managed to reduce network charges to customers by 33 per cent. It is now policed by the Utility Regulator of Northern Ireland.

The proposal comes on the back of last month's report by the Consumer Council, the DOE, NIE and the regulator which sought to inform customers of the changes.

How the multi-million-pound investment be spent includes a ‘price control' period entitled ‘RP6'.

NIE plans to spend £60 million ensuring the electricity network complies with safety legislation – reducing public safety issues, interference and vandalism.

But most of the huge investment – £277m – will be put towards replacing equipment and installations no longer fit for purpose.

That includes damaged power lines and out-of-date technology.

In order to cope with the growing commercial and residential developments which can put the network under stress and cause service issues, £53 million will be spent to reinforce network capacity – preventing so-called ‘power congestion'.

A further £10 million will be spent enhancing NIE's telecoms network and on research into the benefits of new technologies which could improve future service and efficiency, the company says.

According to the report, NIE plans to raise money for RP6 through a combination of its profits and raising new debt and retention of its earnings.

By the end of RP6, the company expects its borrowings to increase to £950 million.

The report also zoomed in on NIE's commitment to environmental sustainability, stating that it was already ahead of targets set by the assembly in 2010.

“[The assembly] set a target of achieving 40 per cent of electricity consumption from renewable sources by 2020, including an interim target of 20 per cent by 2015,” it said.

“At this point we have helped deliver 880MW of renewable generation, which at 25 per cent, is ahead of the 2015 government target.”

Following a period of consultation with the regulator, the final plans will be published in June 2017, before the agreed plan gets put into action the following October.

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