SECOND REPORT
The Northern Ireland Affairs Committee has
agreed to the following Report:—
ELECTRICITY SUPPLIES IN NORTHERN IRELAND:
IMPACT OF THE 26 DECEMBER 1998 STORM
INTRODUCTION
1. On 26 December 1998, a severe storm affected
Northern Ireland, with gale force winds causing very substantial
damage to overhead electrical distribution lines. In the course
of that day, around 162,000 customers of Northern Ireland Electricity
plc (NIE),[1] some 24%
of the total customer base in Northern Ireland, had their supplies
interrupted for some period of time, and at the peak about 110,000
customers (16%) were off-supply simultaneously. Around 63,000
customers remained off-supply at midnight. A combination of the
scale and complexity of the damage to the system, and continuing
inclement weather which both caused further faults and delayed
repairs, meant that the last customers did not have their supplies
restored until 1 January 1999, some six days later. In all, electricity
supplies to an estimated 24
6,000 customers were affected over the period 26 to 31 December.
[2]
2. Not surprisingly, NIE was deluged by attempts
to call its telephone Helpline— 650,000 in all over the
period 26 to 31 December and over 300,000 on 26 December alone.
The volume of traffic was way beyond NIE's call handling capacity
and,
at certain times and in certain places, beyond the capacity of the telephone system.
This failure to be able to contact NIE enhanced customers' dissatisfaction
with NIE's response to the storm. Many customers who did make
contact complained of receiving misleading, inadequate or out
of date information.
3. As a result of the delays in reconnecting
some customers and the difficulties in obtaining information from
NIE, there was a widespread perception in Northern Ireland that
NIE'
s response had been inadequate.
This perception was reinforced by recollections of previous disruption
to electricity supplies, on Christmas Eve the year before, again
caused by adverse weather conditions. We therefore decided on
13 January to look into NIE's response, its compensation proposals,
and ways in which future improvement might be effected.
4. We have taken oral and written evidence from
both NIE and from the Director General of Electricity Supply for
Northern Ireland ("
the Regulator").
We have also received written evidence from the Northern Ireland
Consumer Committee for Electricity, and a range of other individuals
and bodies. Much of this is set out in the Appendices to the Minutes
of Evidence. Included in our publicity for the enquiry was a general
invitation to make written submissions. Somewhat surprisingly
in the light of the concerns expressed at the time, we received
responses from only two electricity consumers and one local authority.
We are most grateful
to all who submitted oral or written evidence.
5. We have been ably advised in the course of
this enquiry by Professor John Surrey, lately of the Science Policy
Research Unit, University of Sussex. We are most grateful to him
for his guidance in relation to matters relating to NIE's capital
expenditure programme.
6. NIE published, in early February, a comprehensive
report on the storm,[3]
which included the
measures they planned to take in response.
We have drawn on this, as well as on the oral and written evidence,
for the purpose of this Report. Storms associated with the same
weather system also caused widespread damage to the overhead distribution
system and, in some areas, the transmission system, in large parts
of Scotland and Northern England. In all, six Public Electricity
Suppliers (PES) in Great Britain declared system emergencies.
In Great Britain, over 400,000 customers were off-supply at one
time or another as a result of storm damage to the supply system and over 7,600 customers were off-supply for more than 72 hours.
7. In May 1999, the Office of Electricity Regulation
(OFFER) published a report[4]
on the supply interruptions in Great Britain following the storms,
and the responses of the PES. We have drawn on this, too.
8. This is the second time that aspects of the
electricity supply industry have been subject to scrutiny by this
Committee. In November 1995, our predecessors reported on electricity
pr
ices in Northern Ireland.
[5]
Although this enquiry was primarily focussed on issues arising
from the storm, it has inevitably ranged more widely as many of
the considerations cannot be detached from the wider ongoing public
debate about the future structure of the electricity supply industry
in Northern Ireland and the continuing interest in reducing the
current differential in electricity prices between Northern Ireland
and
the rest of the United Kingdom.
9. The affairs of NIE have also been the subject
of a Monopolies and Mergers Commission (MMC) enquiry, following
the failure of NIE and the Regulator to agree on revised restrictions
of transmission and distribution charges and supply charges to
apply from 1 April 1997, and their subsequent ref
erral to the MMC by the Regulator.
The MMC's extensive report[6]
was presented to the Regulator in March 1997 and forms the basis
of the price controls now in operation. Both NIE and the Regulator
refer to this report in their evidence.
1 Northern Ireland Electricity plc is a wholly-owned subsidiary of Viridian Group plc. Back
2 Appendix 33, p. 119. Back
3 Referred to in this Report as the "NIE storm report". Back
4 Supply interruptions following the Boxing Day storms 1998, OFFER, May 1999, referred to in this Report as the "OFFER report". Back
5 Second Report from the Northern Ireland Affairs Committee, Session 1994-95, HC 395. Back
6 Northern Ireland Electricity plc: A report on a reference under Article 15 of the Electricity (Northern Ireland) Order 1992 (The Stationery Office: April 1997). This report is referred to subsequently as the "MMC Report". Back
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