MEA reports deficit of £24 million

The Manx Electricity Authority is reporting a record turnover of £75 million for 2008/2009, an increase of 25 per cent over the previous year.

It was aided by electricity exports exceeding budget by 110 per cent, and delivering a profit from exports of £5.4 million.

The amount of Government Revenue Grants received during the year, to relieve interest charges, reduced from £9.9 million to £8.9 million, while interest charges for the year were down from £22.7 million last year to £19.8 million.

Operating costs for the year increased from £55.8 million in 2007/08 to £88.4 million, reasons for which included an exceptional cost of £5.4 million relating to the renegotiation and subsequent accounting reclassification of the Gas Pipeline Capacity agreement with Bord Gais Eireann, a unrealised loss on foreign currency exchange of £10.6 million, due to the revaluation of the long-term commitment due under the Gas Pipeline Spur agreement, and an increase of £14.7 million in costs of fuel and energy to supply the Island's demand, export sales and Manx Gas.

In addition, fuel costs relating to exports to the United Kingdom increased from £2 million to £5.8 million.

As a result of those exceptional issues and increased costs, the authority's overall deficit for the year was £24.3 million.

The above figures are outlined in the MEA's Annual Report and Accounts, which will be laid before Tynwald next week.

Chairman, Quintin Gill, MHK explained: 'The last financial year saw a continuation of saving activities intended to return the authority to profitability, as set out in the financial model approved by Tynwald in July 2005.

"I am pleased to report that we are ahead of the timescales approved by Tynwald.

"The board continues to monitor and report against this model, and I can confirm that we again took less support grant than expected."