Peat volumes to ESB West Offaly Power Station in Shannonbridge and Lough Ree Power Station in Lanesborough will decline by approximately 50% from December 2019, an internal memo to Bord na Mona (BNM) staff members states.
The move coincides with the consequences of BNM no longer being supported by the PSO subsidy – as such they must co-fire with biomass to continue to operate.
Meanwhile, management, administrative and operational roles are set to bare the brunt of up to 430 job losses at BNM, which the company expects to be impacted by its new strategy plan announced today (October 24).
The internal memo, seen by AgriLand, has been circulated to staff members following the announcement of its intention to accelerate its move away from traditional peat production into renewables.
The company will shortly open a voluntary redundancy programme, with the expectation that these changes could directly impact approximately 380-430 roles and employees.
Key Points
Other key points announced in the company’s new strategy includes the following: 75% of energy generated by the company will be renewable by 2020 – up from 10% in 2010; the development of new businesses to support the low-carbon economy in development; the company will identify the potential to create 400-500 jobs across the midlands in the medium term.
There will also be accelerated development of renewable energy assets, the provision of up to 2GW of generating assets by 2030 and a steep increase in the supply of greenhouse gas (GHG) neutral biomass, replacing peat to the three midlands power stations.
It is also expected that the expansion of company’s new tyre-recycling plant will create 46 jobs.
‘Global Threat’
In his memo, BNM chief executive Tom Donnellan described climate change as a “global threat” and stated that decarbonisation is the Government’s and EU’s response to this challenge.
“The impact of decarbonisation means we must transition away from our peat based activities over time.
“Peat volumes to ESB will decline by approximately 50% from December 2019, when West Offaly and Lough Ree power stations are no longer supported by the PSO subsidy and they must co–fire with biomass to continue to operate.”
The UK retail horticulture market, aligned with UK government policy, is phasing out the use of peat in growing by 2020.
“The regulatory and market environment for solid fuels means our fuels business will face increasing challenges over the coming years,” the letter states.
Town Hall Meetings
Following last month’s board meeting, Donnellan said he communicated BNM’s new strategy that responds to these impacts and secures the company’s long-term future.
The memo states that the new strategy has three core objectives: consolidate and simplify our peat based businesses; develop and expand our resource recovery and renewable energy businesses supporting Government policy; and invest in the development of new business opportunities to create and support sustainable employment in the midlands.
“I also announced a new organisation structure of four Business Units and a lean centre, re-positioning the company to deliver the strategy.
“The new Business Unit leaders have been working over the last number of weeks on their proposed level two organisation structures, which were presented to the board today.
We will now move to implement that level two structure with roles being advertised from next week. When these roles are filled we will move on to the next levels within the organisation as quickly as possible.
In the memo, Donnellan stated that the process has meant “confronting some extremely difficult” choices.
“The reality is fewer people will be working in management and administrative roles in the Energy Business Unit and Central Support Group.
“There will also be a reduction in operational roles in the Energy Business Unit.
Following today’s board meeting, we expect that these changes will directly impact approximately 380-430 employees.
“A consultation process that includes the Group of Unions is underway. It will enable us to work through these challenges together,” he said.
A series of town hall events have been organised over the coming days where Donnellan will talk directly to staff about this strategy.
“We will also be engaging with you to ascertain your views and concerns at feedback forums which will be organised at various locations next week.
“We will be announcing a voluntary redundancy programme for employees in impacted roles and areas. This will open shortly and we will be in touch with details. I look forward to meeting and engaging with you at the town hall events,” the memo concludes.