The ESB has objected to the planning permission being sought for the £26 million (€33 million) Spencer Dock development, on the grounds that its current electricity plans are "imprudent and insecure".

The ESB believes the proposal for a combined heat and power (CHP) plant fails to comply with law and could leave future residents of the area stuck with one supplier and unable to benefit from competition.

In a letter to Dublin Corporation seen by The Irish Times, the board says that to guarantee supply of electricity long into the future, it needs to build a substation somewhere on the site.

"It is considered imprudent and certainly not in the best interests of the future occupiers of the Spencer's Dock development that their supplies of electricity are dependent on an `island site' that is not interconnected to the national electricity grid, at a minimum for stand-by and back-up supply purposes," the ESB company secretary, Mr Larry Donald, says in the letter.

"We have explained our views on the need for interconnection repeatedly to the developer, but two years on we appear to have made little impact on the proposals," the letter continues.

However, Mr Richard Barrett, a director of Treasury Holdings, the company developing the site, said last night that the electricity arrangements were, at this stage of the planning process, "none of the ESB's business".

He said planning permission had been sought on the basis of a CHP plant being built, which would obviate the need for a substation. With the electricity market being gradually deregulated, it could be possible in the future to supply the development without the ESB.

Mr Barrett added that the substation would cost £10 million (€12.7 million) to build. Paying for the development's own requirements was one thing, but as such a sub-station would add capacity for the entire north docks area, this could mean Treasury Holdings would wind up subsidising the ESB, he said.

In its letter, the ESB rules out a CHP plant, adding that "under current legislation such an arrangement for electricity supply is not permitted", and says that even in a future competitive environment, leaving the development out of the Republic's grid would mean residents could be forced to remain with one supplier.

"On the other hand, if the development is connected to the national distribution network, occupiers will be able to access all licensed electricity suppliers and not simply ESB," the letter says.

A spokesman for the ESB last night confirmed that the company had submitted a letter to Dublin Corporation, adding that the local authority had requested its opinion on the Spencer Dock development. He said the ESB was reluctant to comment further.