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News : Irish Last Updated: Dec 19th, 2007 - 13:17:15

ESRI report warns of risk of electricity shortages
By Finfacts Team
Dec 18, 2006, 07:48

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Long-term plans should be drawn up to ensure essential services do not run out of electricity at peak times, the Economic and Social Research Institute (ESRI) has said.

Source: ESRI

In a report published today, the ESRI says high growth in electricity demand and an aging plant portfolio have created a tight market for the next few years. While hospitals and large businesses are prioritised when supply is limited, simple services such as traffic signals can be cut from the grid at little or no notice, causing major disruptions. It is these aspects that need to be addressed, according to the ESRI.

When all plants are available, the probability of a shortage is very small, but the age and dilapidated state of some of the country's main power generation plants, including Dublin's Poolbeg facility, mean that supplies can be cut at short notice. In November, 18 per cent of generation capacity was unavailable because of unplanned outages.

The report says that the probability of a shortage depends crucially on the power units in Poolbeg, Great Island and Tarbert. If these work, as is the case in early December 2006, chances are there will be no shortages. When none of the three is running, however, the probability of a shortage jumps to 47 per cent. Maintenance of these units is therefore a great priority. Agreements between the Commission for Energy Regulation and the ESB, aimed at reducing the ESB’s market power, will likely involve the closure of the Poolbeg steam plants, Great Island and Tarbert by 2010. However, until reliable alternatives to these plants are built and commissioned, they need to be kept in good working order. The alternative is to have a substantial risk of a shortage.

The capital cost of replacing 1,200 MW of peaking capacity is currently estimated to be around €480 million. This level of investment would allow the system to be consistently on the right-most line in Figure 1. It is also likely to be smaller than the cost of shortages to the Irish economy, although quantifying these costs precisely is difficult.

The report also says the probability of a shortage is highest in the two weeks before Christmas. As a result the ESB, which currently has a monopoly on electricity generation in the Republic, said in November that contingency measures had been put in place, with approximately 300 megawatts of power on the North-South electricity interconnector being reserved for the Republic.

However, the report says that this isn't enough and that more should be done to ensure there is always a reserve supply to call on should the need arise. While wind can help in this area - during the last week in November and first week in December, 10 per cent of the State's electricity supply came from wind power - it is not considered a reliable source, as it is dependent on the weather.

Laura Malaguzzi, co-author of the report, says that power supplies need to be managed to ensure that supplies for essential services remain. She says that more systems should be put in place to encourage people to switch off electrical appliances and lights when they aren't being used, and also puts forward the idea of charging higher prices for electricity used at peak times.

According to the ESRI, something needs to be done urgently to prevent the problem becoming a recurring one every winter.

EirGrid, the company which operates the country's electricity transmission system said last week that its analysis to date, based on information provided to us, indicates that the outlook for electricity supply this winter is satisfactory.

"But we would emphasise that improvements in performance by the power generation sector are needed over the coming weeks and months and that the situation is a dynamic one, with potential to change. It should also be stressed that more efficient use of power by us all as consumers is very important. Demand for power in Ireland has been growing rapidly and at a higher rate than in many other EU countries. Factors include a major growth in new dwellings and an increasing use of power by existing customers. Ireland now uses more than double the amount of power it did in the 1980s," the company said.

Eirgrid said that while there is sufficient generation capacity installed in Ireland to meet demand, this generation capacity can be reduced significantly by break-downs and maintenance problems at power stations. The major increase in demand, combined with a decline in the availability of some older power stations, is causing a tightening in the gap between capacity and demand. As such, were there to be deterioration in the availability of power plants, this could have an impact on the supply situation.

Significant quantities of new wind generation has been connected in recent year as well as major thermal power stations at Huntstown, Co Dublin; Tynagh, Co Galway; and Aughinish, Co Limerick, the company said.

© Copyright 2007 by Finfacts.com

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