One more mention of a winter of discontent is liable to put us all in a bad mood, but it’s hard to avoid.
Eirgrid, which operates the national grid, has warned of challenges to electricity supply in the years ahead. "We expect system alerts to be a feature of the system over the coming winters, and this winter is likely to be challenging," said Mark Foley, EirGrid chief executive.
Long-term system electricity demand in Ireland is increasing, and is forecast to increase significantly due to the expected expansion of many large energy users, in particular data centres. Such rapid increases in demand are unusual, according to its recently-published Generation Capacity Statement.
While it is working on solutions the long-term demand forecast in Ireland continues to be heavily influenced by the expected growth of large energy-users, primarily data centres. EirGrid’s analysis shows that demand from data centres could account for 23 per cent of all demand in Ireland by 2030.
At the same time additional demands will be made on the grid from the heat and transport sectors as they move towards electrification. In Ireland forecasted growth in electricity demand between 2021 and 2030 could be between 28 per cent and 43 per cent .
Heat pumps
According to the Irish Academy of Engineering’s National Energy and Climate Plan, Ireland has targeted 900,000 electric vehicles on the road by 2030, as well as 600,000 domestic heat pumps. “In this context a failure of the power system would have a catastrophic effect on normal economic life,” it warns.
In the meantime high demand and supply pressures are already pushing prices up at home and abroad.
Internationally the wholesale price of natural gas rose by 250 per cent between January and the end of September. Knock-on effects are already being felt. Rising gas prices have led to a shortage of carbon-dioxide, used to stun chickens and pigs before slaughter.
More than half of Ireland’s electricity comes from gas-powered plants, which is why it impacts electricity prices here.
Maintenance issues have been a factor in the current crisis, both internationally and at home. Bord Gáis’s gas-fired power plant in Whitegate Cork, and Huntstown, a gas-fired power station in Dublin, have both been out of action for extended periods, though due back on stream within weeks.
Internationally Russia’s Nord Stream 2 pipeline should have an impact on prices in Europe. But European output is falling too, in line with its climate ambitions. The giant natural gas field near the Dutch city of Groningen is preparing to shut down for environmental reasons. Denmark is putting an end to new oil and gas explorations and slashing gas production forecasts in the meantime.
As the world continues its shift away from fossil fuels to renewables, there’s less incentive to invest in gas projects even as demand for it rises, and renewables, at least during the transition phase, don’t deliver enough power. A factor in the current crisis is the fact that for extended periods the wind simply didn’t blow.
Choice
All of this leaves consumers worried about both the environment and their energy bills. The Government has committed to spending almost €9 billion on deep retrofits of 500,000 homes to make them better insulated and more environmentally friendly, including the installation of renewable heat systems.
Home-owners are faced with a choice either to pay increasingly higher prices for existing fossil fuel heating systems or, even with grant supports available, having to take out chunky home improvement loans to pay for an upgrade.
The rising price of building materials and industry puzzlement as to where all the workers will be found doesn’t help. Neither does the fact that rising energy prices means the return of inflation.
News that capacity is so constrained as to make 1970s-style blackouts a possibility is the last thing anyone wants to hear as we face into winter, and a La Nina one at that.
Yet perhaps the worst part about the current bad news on the energy front is the risk that if handled badly we could be one bad winter, two horror show utility bills and a rolling blackout away from a green-lash. That truly would be disastrous.
