PR6 outlines a proposed €14.1 billion investment package for Ireland’s electricity networks between 2026 and 2030 and comes at a crucial moment as the State accelerates its transition to a low-carbon economy and expands its ambitions for offshore wind development. Following the publication of its PR6 Strategy Paper in April 2024 and engagement with key stakeholders, the CRU has released these Draft Determination proposals.

Overview of the Draft Determination

The CRU is proposing a baseline investment package of €14.1 billion, comprising:

• €9.2 billion in capital expenditure (capex) and €2.3 billion in operational expenditure (opex) for ESB Networks; and
• €1.4 billion in capex and €1.2 billion in opex for EirGrid.

These figures represent an 86.2% increase on the total expenditure within the PR5 period but represent a 9.4% reduction relative to the original baseline requests of the ESB Networks and EirGrid (the network companies). The CRU has set out a high case expenditure estimate of €18.1 billion that would be accessible through a newly established Agile Investment and Monitoring Framework (AIMF).

Key Regulatory Developments

The PR6 Draft Determination introduces several important regulatory innovations, including:

1. AIMF: An agile, light touch framework which is intended to allow network companies to access additional expenditure and revenue during PR6 based on evolving needs and circumstances while also protecting consumers’ interests.
2. Delivery Obligations: Ringfenced allowances will be linked to the completion of certain high priority items by the network companies, the completion of which must be reported on on a quarterly basis.
3. Performance Incentives: Although building on those incentives in PR5, the CRU is proposing to increase the size of the Transmission Asset Owner (TAO) Performance Incentive package and create clearer outcome based targets for the entire PR6 period.
4. Offshore Price Control: A tailored regime for EirGrid’s offshore role, with custom incentives and a hybrid return model, is also proposed.

Offshore Infrastructure and Decarbonisation Objectives

The PR6 proposals are closely aligned with the Government’s Climate Action Plan 2024. The CRU’s framework is designed to support the development of Ireland’s offshore wind capacity, with further expansion anticipated in subsequent periods.

Key offshore-related measures include:

• Establishment of the Offshore Asset Owner function within EirGrid;
• A proposed investment gateway process will monitor EirGrid’s management of capital programmes with indicative costs for Tonn Nua in the range of €1.6–€2.2 billion; and
• Performance incentives linked to timely delivery and operational availability of offshore assets.

The CRU plans to allocate €505.2 million to EirGrid for offshore wind projects during PR6. This assumes that a single Phase 1 offshore asset transfer, whereby EirGrid will take ownership of offshore grid relating to an offshore windfarm, will take place during the period. Additional funding may be accessed through the AIMF if further transfers occur. This indicates that the CRU believes only one offshore Phase 1 project will complete by 2030 and the CAP 2025 targets of 5GW of offshore wind capacity by 2010 will not be met.

Customer Impact and Cost of Capital

The CRU estimates that the proposed investment will result in a modest increase in network charges for domestic customers – approximately €6 to €16 per annum over the PR6 period – depending on the investment scenario. These charges represent only one component of the overall electricity bill and may be offset by system efficiencies and reduced constraint costs.

The Draft Determination also sets out proposed Weighted Average Cost of Capital (WACC) allowances for EirGrid and ESB, which is a metric used to determine the permitted return on investment for both entities.:

• 3.85% for ESB Networks (DSO and TAO);
• 4.58% to 5.23% for EirGrid (TSO and OAO functions).

The CRU has determined these rates based on its analysis of economic feasibility and current market trends and are subject to revision in the Final Determination.

Next Steps

The CRU is inviting stakeholder submissions on the Draft Determination until 11 September 2025. The Final Determination is expected to be published in December 2025.

Contributed by Alex Needham, Anny Svinti and Hannah Kelly.