Bord na Móna maintains a Provision on its balance sheet to pay for the future costs of rehabilitation and
decommissioning when industrial peat extraction ceases. This is updated every year.
Bord na Móna Annual Report (Bord na Móna 2021)
Environmental reinstatement costs include:
Costs that will be incurred at the end of the economic lives of the peatlands. Under IAS 37, provision is made for these costs when the circumstances occur giving rise to the obligation under the Group’s Integrated Pollution Prevention Control licence to decommission and reinstate the peatlands post peat production.
The provision of €33.8 million (2020: €30.5 million) as at 31 March 2021 represents the present value of the expected future costs of decommissioning and reinstatement.
The key assumptions included within the provision are the cost of machine hours and man hours and the related level of activity required to carry out the decommissioning and rehabilitation works.
The majority of the obligation will unwind over a ten‑year timeframe but the exact timing of the payment is not certain.
Briquette and Horticulture Plant closure costs
A provision of €3.9 million (2020: €4.8 million) is held for plant closure costs based on the present value of the current estimate of the costs of closure of briquette and horticulture compost plants at the end of their useful economic lives.