THE CHIEF executive of one of the Republic's State power supply companies says the ESB should be broken up as a matter of urgency.

Dermot Byrne, chief executive of Eirgrid, which manages the national grid, the State's electricity transmission network, believes the Government should go ahead with its plans to split the ESB's power generating and transmission arms.

Last year, the Government said it aimed to to transfer ownership of the national grid from the ESB to Eirgrid, an independent agency, which manages the system but does not own it outright.

In March, the Minister for Energy, Eamon Ryan, said he was going to have the proposal reviewed, but stated it was still Government policy.

The company's unions opposed the move and voted to take industrial action should it go ahead. The employee share ownership trust also came out against the plan.

At the weekend, Mr Byrne told The Irish Times that Eirgrid welcomed the review and pledged to participate fully.

But he said "all parties in this debate, apart from the ESB, agree that it is important to separate the transmission network from electricity production and supply. The electricity transmission network, the high-voltage main network lines, should operate like highways, enabling all travellers to pass. However, a transmission network where the assets remain part of an integrated generator and supply group, such as ESB, would remain open to the perception of being influenced by the interests of their owner."

Mr Byrne added that leaving the national grid in the ESB's ownership would be the same as allowing Aer Lingus to own airports and to collect charges from competitors such as Ryanair for their use.

"In such a scenario, there would be little incentive for it to build infrastructure that will allow new airlines to enter its market.

"Eirgrid requires wide-ranging powers to operate the transmission network and to decide on necessary investments. The strategic benefits of full ownership of the transmission network are the fact that EirGrid could focus on optimising all aspects of transmission for the benefit of customers, and would have a regulatory incentive to do so."

Mr Byrne warned that without progress, the Republic is in danger of being left in a no-man's land, with neither the control of a monopoly, nor with the benefits of an efficient market-based system.