Bord Na Mona is laying off 150 staff at their plant in Lough Ree in Longford after the ESB suspended operations due to environmental concerns.
Work was suspended after the Environmental Protection Agency (EPA) took legal proceedings Bord Na Mona.
The EPA took the action after the discovery that the temperature of cooling water discharged from the plant into the river Shannon is too high.
The company are immediately laying off 78 seasonal workers with a further 72 put on protective notice, RTE reports.
The affected workers are employed in peat supply, bog operations and maintenance at the nearby Mountdillion works supplying the electricity plant at Lanesborough.
Bord Na Mona say they were forced to make the layoffs after the ESB confirmed that plant would be off line indefinitely.
A meeting will be held with the Bord na Móna Group of Unions for tomorrow.
