I guess you have to speak Ukrainian to work for Kind Fairy, but this business model can be used in other languages too.
The video is now online.
Eamon Ryan and Kieran O’Brien both cite an ESRI paper, but O’Brien does so accurately. UPDATE: The abstract of the paper is here.
Minister Ryan argues that the price of electricity falls as more wind power is added. This is true. The price reflects the marginal cost of power generation, which is zero for wind. However, what matters is the total cost of power generation, which may well increase as more wind is added to the system. From the household perspective, the price of electricity goes down with more wind, but the standing charge goes up.
Minister Ryan again extols the virtues of import substitution, despite much evidence to the contrary.
The government have published the Credit Institutions (Stabilisation) Bill which is scheduled to be debated on Wednesday and enacted by the end of the week. It appears to be a sort of mini-special resolution regime bill. The Minister for Finance’s statement on the bill notes that “it is the first important step in putting in place an extensive Special Resolution Regime (SRR) that will provide for a comprehensive framework to facilitate the orderly management and resolution of distressed credit institutions.”
The explanatory memo for the bill is here while the bill itself is here.
For our legion of subbie-watchers, the relevant sections are sections 28 to 32. They appear to empower the Minister for Finance to make debt-for-equity swaps to subdebt holders and to have various rights of these debtholders to be set aside if the state has provided financial support required to allow continued viability of a bank. As speculated here recently, the bill appears to allow the Minister for factor in past equity investments when considering whether to introduce a “proposed subordinated liabilities order” which would allow such powers to be introduced.
For me, this raises two questions: First, what is there in this bill that couldn’t have been introduced two years ago? Second, if the bill gives the Minister the powers to make certain rights of subdebt holders cease to be exercisable, then is there a legal impediment to the Minister having the power to deal with other creditors of a bank.
Frank Convery has an interesting piece under this title on the Comhar Blog
There is an interesting piece in the Irish Times today.
Carbon dioxide emission permits are given away for free (grandparented) to electricity companies. This is a transfer of property from we the people to the shareholders of those companies. This has been going on for a couple of years, but no one protested too loudly.
The government has now introduced a new tax on the value of grandparented permits, and the regulator has ruled that this new tax cannot be passed on to electricity consumers. This is a good approximation to the preferred solution of auctioning permits.
Hat tip to Minister Ryan, so.
Of course, there is the law of unintended consequences. First, there was the PSO levy. Now, private companies argue that what once was a windfall profit, now is part of their regular return to capital.
The verdict will be interesting. Will the judge reason from a 2007 perspective, which has that the companies enjoyed a windfall for three years, which the government now ends? Or will the judge adopt the 2010 perspective, which has that the companies have a reasonable expectation for an income stream (based on the current position of the European Commission and the position of the government until only a few months ago) which the government capriciously removed?