EirGrid plc Annual Report 2011

EirGrid plc Annual Report & Accounts 2011
18. Operating Lease Arrangements
Future minimum lease payments under non-cancellable operating leases, which are primarily in respect of the
Group’s buildings and a land lease for the East-West Interconnector project, fall due as follows:
Group
Company
30 Sep 2011 30 Sep 2010 30 Sep 2011 30 Sep 2010
€ ’000 € ’000 € ’000 € ’000
Not longer than one year 3,043 2,661 3,043 2,661
Longer than one year and not longer than five years 11,797 10,494 11,797 10,494
Longer than five years 43,843 29,760 43,843 29,760
Total 58,683 42,915 58,683 42,915
The operating lease for the Group’s head office building is for a term of 25 years which commenced on 1 March
2007. There was a rental holiday for the first three years of the lease term. The lease cost is based on open
market value and is subject to rent review every 5 years.
The Group has agreed a lease of land in the port of Liverpool, secured via an upfront payment. The agreement
includes a break clause after the first 30 years of the lease. After this 30 year term, lease payments will be
subject to inflationary increases.
There are no significant or unusual restrictions imposed on the Group by the terms of the operating leases.
19. Capital Commitments
Group
Company
30 Sep 2011 30 Sep 2010 30 Sep 2011 30 Sep 2010
€ ’000 € ’000 € ’000 € ’000
Expenditure contracted for, but not
provided for in the Financial Statements 243,826 337,832 - -
The Group has significant contractual commitments arising from the East-West Interconnector, a project to
link the electricity grids of Ireland and Britain. The budgeted capital spend on the project is €601m.
In 2010, the East-West Interconnector asset under construction was transferred from the Company to another
Group subsidiary, EirGrid Interconnector Limited. The Company has entered into an agreement with EirGrid
Interconnector Limited to licence the East-West Interconnector asset once construction is completed.
20. Contingent Liabilities
The Group has issued a letter of credit of €8.7m in respect of its commitments to the East-West Interconnector
project. The Group does not expect any material loss to arise from this contingent liability.
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