EirGrid Forecasts Significant Increase in Electricity Demand

22 October 2018

Demand for electricity is set to climb steeply over the coming years as increasing numbers of large energy users, primarily data centres, connect to the grid.

According to EirGrid Group’s All-Island Generation Capacity Statement 2018 – 2027, the growth in energy demand for the next ten years will be between 15% and 47%.

Mark Foley, chief executive of EirGrid Group, said the forecast growth in demand was concentrated in Ireland and was unprecedented: “Data centres consume a lot of power and can require the same amount of energy as a large town. EirGrid Group’s analysis shows that data centres could account for approximately one quarter of all electricity demand in Ireland by 2027.”

The Generation Capacity Statement examines the likely balance between electricity demand and supply during the years 2018 to 2027. In preparing the report, the two grid operators on the island, EirGrid in Ireland and SONI in Northern Ireland, consulted widely with industry participants and used the most up-to-date information. A range of scenarios was prepared to forecast electricity demand over the time horizon of the report.

According to the statement demand in Northern Ireland has been relatively stable and is expected to continue so. In Ireland, electricity demand could grow by up to 57% in the next 10 years and it is expected that new environmentally-friendly generation will be required to meet demand.

The report identifies the decommissioning of older electricity generators due to de-carbonisation targets as another challenge to the sector. Both Irish and UK governments have ratified the COP 21 Paris Agreement and are committed to ensuring that the global temperature increase stays below 2°C.

As discussed in the statement, the advent of the new Integrated Single Electricity Market (I-SEM) on October 1st is likely to have an impact on the fleet of electricity generators across the island.

Under the previous electricity market arrangements, all available generators benefited from capacity payments. This is no longer the case and some generators were not successful in the first Capacity Market auction which was run in advance of the I-SEM launch.

The Generation Capacity Statement says much progress has been made towards meeting Ireland and Northern Ireland targets for renewable energy, and this is set to continue. EirGrid and SONI are supporting the integration of more intermittent generation sources with initiatives that enable the power system to operate with up to 65% variable renewable energy.

The All-Island Generation Capacity Statement 2018 – 2027

SONI, the transmission system operator (TSO) in Northern Ireland, is required by licence to produce an annual Generation Capacity Statement. Similarly, EirGrid, the TSO in Ireland, has a regulatory requirement to publish forecast information about the power system, including an assessment of the balance between supply and demand.

A range of scenarios was prepared to forecast electricity demand over the time horizon of the report. In our adequacy assessment studies, we modelled the generation portfolio against the demand forecast, using the accepted standard risk. These studies were carried out separately for Ireland and Northern Ireland, and jointly on an all-island basis.

Read the full report here.