Power cuts like those seen in Spain and Portugal could be a danger for Ireland if the Government does not provide for storing natural gas, according to a leading industry figure.
This State has no natural gas storage, or a liquefied natural gas (LNG) terminal, despite relying on the fuel to generate close to half of all electricity.
The Republic ultimately risks “interruptions to supply” of this key energy source if it does not deal with this question sooner rather than later, Sean Casey, industrials and energy industry leader at EY said.
Natural gas generates 40 per cent of Irish electricity, Mr Casey noted, with the State importing 80 per cent of its natural gas via the UK. Its only home-grown source of the fuel, the Corrib field, is dwindling.
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He warns that we recently saw in Iberia what interruptions specifically to electricity supplies can do. “An interruption in supply would be catastrophic for some industries and some businesses, but ultimately that is what you are trying to avoid,” Mr Casey says.
He stresses that he is neutral about what option Government chooses but argues that the State needs a gas reserve. “Ultimately I would like to see us get on and do that, whichever project is put forward.”
New figures from national grid operator EirGrid show that more than 52 per cent of electricity used here in July was generated by burning fossil fuels, most of which was natural gas. The Republic imported about 15 per cent from Britain.
Mr Casey supports Climate Action Plan aims to electrify heat and transport but says natural gas will continue to play a big part in aiding the Republic’s move to renewable energy.
Darragh O’Brien, Minister for Climate, Energy and the Environment, recently announced plans to oblige businesses selling oil and gas for heating to include renewable fuels in their supplies.
Mr Casey argues that this is a welcome move and says the Republic should push on with plans to increase the use of renewable gas.
The State has a modern gas network comprising 14,000km of pipelines, run by Gas Networks Ireland (GNI), where Mr Casey was chief executive for three years. He maintains that the State should continue to use this as it continues the transition to green energy.
Mr Casey held senior posts in Irish energy companies and utilities for several decades, including GNI, its one-time parent, Ervia, the ESB and Bord Gáis Energy.
The main challenge facing businesses he now advises in the industry is getting projects through the Republic’s planning process to completion.
Energy prices remain a key concern for Irish business. One of the State’s biggest employers, microchip maker Intel, recently warned the Government that high prices threaten the Republic’s ability to lure job-creating investment.
Prices have fallen since the surges in 2021 and following Russia’s invasion of Ukraine in 2022. However, they still remain high relative to what they were before that period, while energy has never been cheap here.
“I do not see any major reduction [in price] right now, but nor do we see any spikes but that is contingent on factors that are out of our control,” says Mr Casey.
On the plus side, he notes that stability is as important to many EY clients as the actual price. “A real understanding of where it is going will allow them to make the decisions they need to make as they move forward,” he says.
