Keeping the power on: high costs to tame
"We have no indigenous energy resources in Northern Ireland." That simple fact, says Donald Stewart of the Northern Ireland Electricity Service, accounts for what he rather mildly calls "the cost problem" here.Skip to next paragraph
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It also brings home a challenge: how to fuel the energy-hungry manufacturers that the government is busily wooing from overseas.
Northern Ireland ships in every ounce of coal and every drop of oil it uses, with predictable effects on costs. "Town gas" (made from gasified petroleum feedstocks) is being phased out. With both coal and oil prices rising, gas costs are between two and four times those in Great Britain.
The ready alternative is electricity, 80 percent of which is produced from oil-fired generators built before the Arab oil crisis in 1973 sent prices scorching upward. Mr. Stewart admits that costs for the domestic (household) user are 22 percent higher than in the rest of the United Kingdom. But Government subsidies have kept prices for industry down to within the British average.
Though electricity may not be cheap here, there is plenty of it. A new plant a Kilroot, near Carrickfergus, will see to that. The first of its four 300 -megawatt generating units will start spinning late this year, adding considerable spark to Ulster's present 2,025-megawatt capacity.
In fact, there is so much electricity here that the government would like to sell some of it. The present surplus is the result of plans for expansion made 10 years ago -- the lead time needed to build new plants. Growth in electricity sales then was about 9 percent per year. It has since sunk to less than half that rate.
Where to sell it?
The government would, of course, be delighted to find more industrial buyers. Another idea, involving undersea lines to Scotland, has been scrapped. Costs of the lines and Scotland's already-plentiful supply made them infeasible.
Sales to the Republic of Ireland to the south are another matter. Terrorists blew up the interconnecting link five years ago, and have threatened repairmen since. But the republic is underpowered. If the weather had been harsher than it was last winter, it could have caused serious power shortages in Dublin and elsewhere; it still could.
So officials on both sides of the border have recently agreed on the need to keep the power link humming despite the threats. Potential savings: "thousands of pounds per day" on each side, Mr. Stewart says.
Is there a possibility of indigenous resources being developed?
No one talks of coal, presumably because there is none.
But oil may have a future here. Applications are before the Department of Energy for both onshore and offshore exploration licenses. And last summer's announcement by British Petroleum of a deepwater find in the Porcupine Basin, off Galway in the Irish Republic, has raised some oily hopes north of the border.
Even if Ulster finds no oil of its own, it has benefited from North Sea oil by supplying the skills and equipment oil companies need for their operations in those stormy waters. Only about 20 percent of oil company expenditure is for exploration. The balance is for development of the finds.
Some 80 such companies in Ulster are already involved directly or indirectly in support of the petroleum industry, and are generating something in excess of get into now," says Peter McCormick, chairman of Irish Bridge, a company specializing in mechanical installations and what he calls "hook-up work" for the petroleum industry.
Irish Bridge has 125 men working for Chevron on the Ninian Central platform in the North Sea, with 80 more here working for British Petroleum, Texaco, and other companies. "The honeymoon period, when companies were willing to go along with you, is over," Mr. McCormick says. "Now the oil companies know what they want."
Irish Bridge, a private company, provides no sales figures. However, Mr. McCormick does say that turnover is increasing. "There's still a lot of money being spent in the North Sea," especially with oil prices increasing and "the marginal fields becoming more interesting," he says.
Another oil-related company, Houston-based Hughes Tool, has been here since 1956. Making rock-drilling bits up to 17.5 inches in diameter, which can sell for around $5,000 each, it exports 95 percent of production.
"With the general world population on the increase year by year," engineering manager Eric Jones says, "the search for oil is an ongoing concern."
The company, with 430 employees at its Belfast plant, expects substantial growth within the next decade. And, in an area where labor relations problems and productivity difficulties cause some exasperating production delays, Mr. Jones emphasizes that 95 percent of its deliveries are on time -- a crucial point to oil companies waiting offshore with expensive, leased drilling apparatus.