Belfast Telegraph

Co Antrim power station owner AES' profits flicker due to fuel costs

By John Mulgrew

Northern Ireland's largest electricity generator has said the impact of fuel and commodity costs are to blame for a "significant variance" in its pre-tax profits - which fell by around £20m.

AES UK & Ireland witnessed a divergence in the fortunes of the two power stations it owns here - one at Kilroot and another at Ballylumford in Co Antrim.

Pre-tax profits at the firm's Ballylumford business rose almost three-fold in the year ending December 2014, increasing to £13.8m.

That was up from £4.94m a year earlier.

But its Kilroot power station witnessed a large drop in profits. Pre-tax profits fell by more than half, falling to £22.9m for the year ending December 2014.

It dropped from £51.8m a year previous.

Turnover across that arm of the AES business also fell, dropping by a third to £133.5m for the year.

Addressing the divergence in profits between the two power stations, Carla Tully, president of AES UK & Ireland, told the Belfast Telegraph: "The significant variance in AES' annual pre-tax profit performance demonstrates the impact of commodity prices on a heavy capital intensive business with significant fixed costs.

"The key drivers of AES UK & Ireland's reduced financial performance in 2014 was a decrease in market revenue due to lower running hours of Kilroot Power Station and the impact of international fuel and commodity prices," she added.

"This was coupled with a mild winter and scheduled maintenance.

"In 2014 Ballylumford power station was dispatched by the System Operator to generate over 30% more electricity than in the previous year."

The figures for the bulk of the firm's Northern Ireland business comprises two separate limited companies - AES Ballylumford and AES Kilroot.

The company's workforce has also grown over the last year, employing 271 staff across both its sites.

AES UK & Ireland is the largest electricity generator here, owning and operating two power stations in Co Antrim.

The firm is wholly owned by the US-headquartered AES Corporation, a Fortune 200 power firm which has a global workforce of around 18,500.

It first entered the Northern Ireland energy market when it took over Kilroot back in 1992, before growing the business to include Ballylumford in 2010.

The mixed figures for AES are "to be expected" from a firm operating two separate, and different, generating stations, according to economist John Simpson.

"I would say it seems they have a had a fairly tough year," he said.

"I think (the figures) are to be expected from two generating stations which are so different.

"Kilroot is an old plant, whereas Ballylumford is more modern, and is being further modified," he added.

"The contrast between the two is probably due to what happens when one station, Kilroot is largely in a coal market, while Ballylumford is mainly gas.

"My understanding is AES hopes to keep both going for five years or more."

Belfast Telegraph