The first stage of a controversial liquefied natural gas plant could cost households and businesses up to €85 million through customer tariffs — even if the facility is never built, the Irish Our News Outlet can reveal.
The proposed LNG terminal at Cahiracon in Co. Clare has been described by the Government as an emergency reserve. However, it has faced fierce opposition from critics who warn that it could handle imported fracked gas from the US — fuel that studies indicate may have a greater short-term climate impact than coal.
The Government is now facing accusations that ordinary gas users will ultimately be left to pay for the controversial project.
The Commission for Regulation of Utilities has issued a “letter of comfort” to Gas Networks Ireland, according to briefings provided to Government ministers in recent months.
The arrangement permits Gas Networks Ireland (GNI) to recover up to €85 million in initial development costs through gas customer tariffs. Those charges could still be imposed even if the proposed LNG terminal never reaches the construction stage.
Sinn Féin finance spokesman Pearse Doherty told the Mail that “workers and families cannot keep being landed with higher costs”.
He said: “For months, the minister has dodged a simple question: who will pay for his LNG terminal? Now we know the answer. Ordinary people.”
Confidential Government documents obtained by the Mail show that GNI has received approval from the Commission for Regulation of Utilities (CRU) to recover certain project costs from its customers.
The document states: “The CRU has confirmed that GNI will be able to recover expenditure up to €85 million (operating and capital) through customer tariffs, even if the project does not proceed to construction, provided such expenditure is efficiently incurred.”
The disclosure comes as the Government faces growing pressure to introduce additional supports to ease the impact of rising energy prices.
GNI supplies more than 720,000 customers through its network, including over 28,000 industrial and commercial users, according to the company’s website.
The company has been authorised to commit €61.1 million in capital spending on the project, alongside €23.9 million in operating expenditure. The preparatory work includes engineering and design, site investigations, procurement planning and the purchase of land required to bring the development to the final investment decision stage.
The proposed liquefied natural gas terminal at Cahiracon, Co. Clare, has been billed as an “emergency” reserve but criticised over plans to handle imported fracked gas from the US
Representatives of the US gas industry said earlier this month that they wanted to supply Ireland with a continuous flow of fracked gas following high-level meetings with Energy Minister Darragh O’Brien and GNI.
On March 4, 2025, the Cabinet agreed to advance the terminal project. Mr O’Brien wrote to GNI later that month to confirm approval and instruct the company to accelerate its development.
However, it was a year later, on March 24, 202, that GNI formally applied for ministerial consent to proceed with the project.
Separate plans aimed at speeding up construction could require an additional €45 million to €59 million in early commitments, as well as the expense of a bridging vessel.
NewERA, which provides financial and commercial advice to the Government, warned that these costs fell outside the existing CRU assurance. It also said it was unclear whether the additional spending could be recovered.
In October 2024, Hollywood actor Mark Ruffalo joined a campaign opposing LNG in Ireland and urged the Green Party to “stop LNG”.
The confidential advice said that the €4 million allocated for land acquisitions might not be covered by the “letter of comfort” guarantee. However, it added that the money could potentially be recovered through the resale of the land.
The documents estimate the overall project will cost approximately €420million, though they say it remains subject to further development.
The Business Post previously reported that the Government was told it will cost €900million to get the terminal fully operational by 2030.
The terminal, which will comprise a jetty and an onshore receiving terminal and pipeline connecting the facility to the gas transmission system, is deemed necessary to ensure a supply of gas in the event of a major disruption to one of the country’s two gas interconnectors.
The initial works are scheduled to be completed in 2027.
The country relies on two gas interconnectors from the UK for around 80% of its gas supply, with the remainder coming from the Corrib gas field in Co. Mayo, which is declining.
The documents note that the LNG terminal would ‘not fully mitigate the impact of a disruption to both interconnectors’ and can only be used as a temporary, emergency measure.
US gas industry representatives said earlier this month that they want to provide a continuous supply of fracked gas to Ireland after high-level meetings with Energy Minister Darragh O’Brien and GNI
However, in March US president Donald Trump told Taoiseach Micheál Martin that he hoped to reach a deal to sell American LNG to Ireland, saying the country had ‘better do something’ to reduce its trade surplus with the US.
Earlier this month, a New Mexico trade delegation led by Governor Michelle Lujan Grisham and representatives from the Independent Petroleum Association of New Mexico (IPANM) met with the head of GNI, David Kelly, and Minister O’Brien.
IPANM said following the meeting that ‘Ireland is ready’ to have a serious conversation about what ‘a durable, long-term LNG supply relationship could look like’.
‘Ireland’s situation is straightforward and urgent: the country depends on outside sources for the vast majority of its natural gas, and its last remaining domestic field is running dry.
‘What’s shifted is the candour – Irish leaders are now openly acknowledging that the energy transition will take longer than planned, and that reliable baseload supply isn’t optional while that transition unfolds,’ the industry association said.
A Department of Energy spokesman said the terminal is ‘critical to Ireland’s energy security’ and that ‘it is expected that the cost of the project will be borne by customers through the existing regulatory framework and/or other measures’.
‘The standard approach for cost recovery for security of supply measures and investments to meet EU regulations is through the existing regulatory framework. Government is exploring all opportunities to minimise the impact of the cost of this vital energy security measure on energy consumers,’ he said.
A spokesman for GNI said that ‘a final decision on the preferred cost recovery model… will be made by the relevant Government departments in consultation with the CRU’.
The CRU told the Mail no tariffs have been levied on customers yet and ‘the Government has not yet made a decision on the final cost recovery method for the project’.
‘The letter of comfort issued was in the interest of ensuring a timely implementation of any measures that are ultimately decided upon,’ it said.
The Green Party opposed LNG terminals during the last government. In October 2024, Hollywood actor Mark Ruffalo joined a campaign against LNG in Ireland, urging the Green Party to ‘stop LNG’.
One study has found that US LNG has a greenhouse gas footprint roughly 33% worse than burning coal over a 20-year period.
