Wholesale energy prices down due to mild weather, strong imports

New survey shows gas prices are 14% lower than December while electricity down 10%

The average wholesale price of electricity in the Irish market in January declined by more than 11 per cent compared with the same month a year earlier

The average wholesale price of electricity in the Irish market in January declined by more than 11 per cent compared with the same month a year earlier

 

Irish wholesale gas prices are 14 per cent lower on average in January than in December as mild weather at the start of the year curtailed demand and strong imports also encouraged cost reductions.

Wholesale electricity decreased by 10 per cent over the same period, the latest Vayu Energy report shows.

The average day-ahead price for gas, the contract for gas delivery tomorrow, was 1.96 c/kWh (cents per kilowatt hour) for January. This compares with an average price of 2.12 c/kWh in January 2017.

The average wholesale price of electricity in the Irish market in January was 5.13 c/kWh, a decline of more than 11 per cent compared with the same month a year earlier.

“The next few weeks should see the downward trend end as temperatures are expected to dip below seasonal averages during February,” said Vayu Energy analyst Catriona Walsh.

Recent changes

Ms Walsh said that the recent changes in the electricity market may also impact the sector.

“The announcement that Northern Ireland’s largest power station would close down is very disappointing news for the market However, the System Operator for Northern Ireland has provided clear reassurances that there will be ongoing sufficient and secure power generation.”

“Other factors, including Viridian Energy’s recent notification of plans to close both their power plants, which have capacity to supply 20 per cent of Ireland’s electricity needs, could lead to further constraints on the power system in the Dublin region,”Ms Walsh added.