Corrib gas incident contributes to rising energy costs in September
Wholesale electricity prices up 10 per cent and gas up 8 per cent last month
Wind energy accounted for about 27 per cent of overall electricity generation on the island of Ireland in September, compared with 22 per cent in August.
Irish wholesale gas prices were more than 50 per cent more expensive on average last month compared with September last year. Irish wholesale electricity and gas prices increased by 10 per cent and 8 per cent respectively over the last month.
According to the latest monthly report from energy supplier Vayu, an increased level of maintenance and outages at gas fields and processing plants across Europe has resulted in wholesale gas prices increasing by 50 per cent and wholesale electricity prices by 28 per cent compared with September 2016.
It makes reference to the recent recent odourless gas incident at the Corrib gas field, which resulted in an unplanned outage, and the strengthening of sterling over the euro during the last month as having an influence on recent gas prices in Ireland.
Vayu’s senior energy analyst, Keith Donnelly, said: “The supply volatility caused by maintenance and unplanned outages in gas fields and plants in Norway was the main driver behind a 10 per cent increase in gas prices from August to September. Irish customers were not only exposed to the increasing gas prices, a faltering euro against sterling added to price pressure in euro terms.
“The Corrib gas field experienced its first unplanned outage since becoming operational in January 2016. Odourless gas from the field entered the Irish transmission system, causing an emergency shutdown of production at the plant. The outage added some bullish sentiment to the UK market as demand increased at the UK to replace the gas lost due to shutdown at Corrib.”
September saw an increase in wind-generated power on the island of Ireland. The report states that total wind generation capacity in Ireland still stands at 3,916 MW. However, wind energy accounted for about 27 per cent of overall electricity generation on the island of Ireland in September, compared with 22 per cent in August.
Mr Donnelly said that a number of issues at French nuclear power plants are threatening to cause havoc with energy markets again this year as gas prices rallied once news of a shutdown at the Tricastin plant was reported. Gas is being sourced to replace the power lost due to the closure of generating units at the plant.
“This, combined with the UK facing its first winter without the large gas storage facility, Rough, means that businesses should be prepared for a very volatile market in the coming months,” he said.