The Government is expected to propose that ownership of the national electricity grid should be removed from the ESB when it publishes its white paper on energy in Dublin this morning.
This move is likely to draw a sharp response from trade union groups representing workers involved in the ESB. The grid is owned by the ESB, but it is operated independently by EirGrid.
One union source said yesterday that it would "fight tooth and nail" against any proposal to split up the ESB.
The ESB is believed to have opposed such a move in its submission to the Government's white paper. The electricity company is understood to have argued that this would simply add to costs and do little to foster competition in the marketplace.
In addition, the ESB has invested about €4 billion of its own resources and borrowings in the grid in recent years and would not want to be left with funding this debt.
Any move to spin off the grid would also reduce the ESB's asset base and affect the amount of money it could buy for its cash-hungry businesses.
The grid, often described as the transmission system, is a network of high voltage lines and cables. Electricity generated in power plants is transformed to higher voltage levels and fed into the national power system. The power grid is made up of over 5,800 kilometres of high voltage lines and cables.
A policy on delivering a sustainable energy future for Ireland in the period up to 2020 will be launched this morning by Taoiseach Bertie Ahern and Noel Dempsey, Minister for Communications, Marine and Natural Resources.
A recent report from the OECD recommended that Ireland should split up the ESB by separating the transmission grid from the generating capacity.
A move to separate the grid from the ESB's ownership is also thought to have been supported by the Competition Authority in a submission for the white paper.
EirGrid, which operates the national grid, has proposed it should be given ownership of the system in a bid to cut costs for consumers. In a submission to Government, it describes the current structure as "unusual" in an EU context. EirGrid said a better system would involve the grid company operating and owning the system.
It is also understood that the Government could require the ESB to divest itself of more than a previous target of 1,300 megawatts, according to a report in the Sunday Business Postyesterday.
