Dublin, 24 June
The Minister for Communications, Energy and Natural Resources today
secured Government approval for a memorandum proposed jointly with Ministers
Coveney and Howlin to streamline and refocus the commercial operations of Bord
na Móna and Coillte, primarily in the bio energy and wind energy sectors.
The decision will see the establishment of a Joint Venture (JV) between the
two companies, with subsidiaries or SPVs as necessary, to focus on the
identified areas of greatest synergy between the two companies, which are:
o A Biomass business, to be called BioEnergy Ireland, which would
procure biomass at market rates from both Coillte and private sources and use
this to supply the entire market (including Coillte’s board companies and Bord
na Móna’s power station) on a competitive, commercial basis.
o A wind business comprising initially of two Coillte windfarms, with
further integration of the wind business over time.
o Shared Services to consolidate central support services and drive
o Recreation and Tourism to realise the green/agri-tourism potential
inherent in the combined land banks of the two companies.
This approach has the potential to capture many of the efficiency gains and
policy benefits of a full merger, while avoiding some of the short-term costs
and risks associated with that strategy. After expert examination it has been
decided to allow both companies concentrate on their core business while
streamlining synergies between the companies where they exist.
For example, Minister Rabbitte added that within weeks he and Minister O’Dowd
planned to publish a bio-energy strategy which would give further momentum to
this important renewable energy.
The Government has agreed that overall responsibility for implementing the
decision, at Ministerial level, is to be given to the Minister for
Communications Energy and Natural Resources. An interdepartmental Steering Group
has been charged with overseeing the project, with NewERA managing the detailed
interaction with the companies and the JV on behalf of the Steering Group.
Officials will be meeting with both companies in the coming days to brief
them fully on the Government’s decision and to begin the detailed implementation
process for the partial merger of the businesses to proceed as quickly as is