Private Wires in Ireland

The Department of Climate, Energy and the Environment has confirmed that private wires will be permitted in limited cases where clear public benefits can be shown. These include direct generator-to-customer links, hybrid connections, EV charging and expanded self-supply. Legislation to amend the Electricity Regulation Act 1999 will be needed, and questions remain on how the consenting process will work in practice. Our Energy team examines the implications of the Government’s Policy Statement and the next steps for legislation, noting key questions on how the consenting process will work.

Following extensive consultation and the publication of guiding principles for the final Private Wires Policy, the Department of Climate, Energy and the Environment (DCEE) confirmed in its Private Wires Policy Statement that private wires will be permitted in limited circumstances, provided a clear public benefit can be demonstrated.

What is a “Private Wire”?

The term “private wire” refers to arrangements where private entities install and operate cables for the purpose of transporting electricity, typically between generators and customers without connecting to the grid. Private wire connections therefore operate independently of, and bypass, the public electricity network.

What is the current position under EU law?

The Internal Market of Electricity Directive provides for the use of “direct lines” under Article 7. Article 7(1) of the Directive requires Member States to ensure that producers, suppliers and customers can use direct lines to supply or receive electricity without facing disproportionate administrative procedures or costs. It also requires Member States to establish objective and non-discriminatory criteria for granting authorisations for the construction of direct lines.

Article 7(4) allows authorisations to be issued subject to either the refusal of access to the grid system, or the initiation of a dispute settlement procedure. This option was transposed into Irish law through the Electricity Regulation Act 1999. A request for a preliminary ruling on the interpretation of certain aspects of Article 7 is currently before the Court of Justice of the European Union (CJEU)[1].

What is the current position under Irish law?

The regulatory framework governing electricity infrastructure is set out in the Electricity Regulation Act 1999, as amended. The effect of this legislation is that only ESB Networks can own a line that connects electricity from an onshore generator to an electricity customer, and only they can operate the lines that make up the electricity distribution system. The distribution system transfers electricity from the substation to end-users, such as homes and businesses.

There are limited exceptions to this. One such exception is where the Commission for Regulation of Utilities (CRU) authorises the construction of a direct line. This may occur only if a customer has been refused a grid connection, or if a dispute over connection terms has been referred to the CRU for resolution, which is effectively the option prescribed by Article 7(4) of the Directive. Ireland’s current position on private wires contrasts with the position of several EU jurisdictions and with the UK who have, in some cases, permitted private wires and private networks for some time.

What did the Private Wire Policy Statement say?

In the Private Wires Policy Statement, DCEE has suggested it will permit the building and operation of private wires in a limited set of circumstances. It states that there must be clear public benefits to allow these developments and where a private wire connection represents “the most efficient approach to new connection”. The Statement outlines four scenarios where private wires will be permitted:

1. Private line from a generator to a customer: A private line is permitted between a direct source of generation and a single user of electricity, where it may be more cost effective for two customers to connect directly to each other rather than to the national grid. Developers of private wires will have no statutory authority to acquire or access land. Any private wire development must be constructed with the consent of any affected landowners.
2. Hybrid connections: Where two separate entities share a grid connection, such as where a wind farm and a solar PV project, owned by different entities. Hybrid connections are efficient as they maximize the use of scarce grid infrastructure, accelerate renewable energy adoption, and support storage technologies, such as battery storage.
3. On street EV charging: This scenario permits the installation of private wires in public or shared spaces to enable EV charging. This would, for example, allow a generator to construct a public EV charging station through a private wire connection.
4. Expansion of self-supply: The existing electricity regulatory framework permits on-site generation, allowing a customer to produce and consume electricity within a single premises, without distribution or transmission. Subject to technical and safety requirements, it may be beneficial to permit a customer to supply electricity to another customer on an adjoining or “contiguous” site. Both customers would remain bound by their respective ESB Networks connection agreements.

What next?

The Government indicates that it intends to bring forward primary legislation to amend the Electricity Regulation Act 1999 and regulations to define standards and processes for granting permission for private wires.

Broadly speaking, the Private Wires Policy Statement is a positive step in the right direction in that it should open up more options for generators and consumers. The positivity is tempered by the number of questions the Statement raises. Ultimately the consenting regime needs to allow for objective and non-discriminatory criteria for the grant of authorisations for the construction of direct lines, without facing disproportionate administrative procedures or costs.

For more information, contact a member of our Energy team.

[1] Case C-756/24 Latvijas Republikas Senats (Supreme Court (Senate) of the Republic of Latvia) 31 October 2024.