EirGrid statement on ISEM Capacity Auction outcomes

26 January 2018

Statement from Rodney Doyle, Market Operations Director, EirGrid:

“Our priority is to ensure that a secure electricity supply on the Island of Ireland is delivered at the least possible cost to consumers.

“The Integrated Single Electricity Market (ISEM) was designed by the Single Electricity Market Committee (the Utility Regulator, the Commission for Regulation of Utilities and two independent members), to replace the current Single Electricity Market. It is designed to deliver increased levels of competition as well as encouraging greater levels of security of supply.

“The recent capacity auction run by SEMO, where generators were invited to bid for supply contracts, was designed to provide capacity for the period May 2018 to September 2019.   The auction reflects the diversity of generation participating in the single electricity market, such as demand side units.

“It takes into account the availability and performance of generators, a range of demand forecasts and interconnection between Northern Ireland and the Republic and with Great Britain. Crucially, it ensures that enough generation is on the system to meet the security standards determined by the Single Electricity Market Committee. There were 100 bidders in the auction, of which 93 were successful.

“The Regulatory authorities have estimated that the auction process will result in savings to consumers of approximately €200 million across the island.”

“We are confident that the generators who have been successful in that auction process will provide safe and secure generation at the lowest possible cost. 

“Further Capacity auctions will take place later in 2018 for future periods.”

Notes to Editors

  • The Single Electricity Market Operator (SEMO) facilitates the continuous operation and administration of the Single Electricity Market. SEMO is a joint venture between EirGrid plc and SONI Limited.
  • ISEM is a new wholesale electricity market arrangement for Ireland and Northern Ireland that comprises multiple markets or auctions, each spanning different trading time frames.
  • The new market arrangements are designed to integrate the all-island electricity market with European electricity markets.
  • It is anticipated that ISEM will bring benefits, including:

- Increased access to cheaper sources of electricity

- A more open and efficient pan-European electricity market delivering benefits to consumers

- Intraday, forward, futures and derivative markets that enable investors and operators manage risk

  • The capacity requirements used in the analysis are arrived at through a thorough calculation process which was consulted on and approved by the SEM Committee.
  • The SEM Committee is made up of the Utility Regulator Northern Ireland, the Commission for Regulation of Utilities in Ireland with an independent and a deputy independent member.
  • It is in line with our most recent report on generation adequacy – the Generation Capacity Statement 2017-2026.

Ends

For further information, please contact:

David Martin 085 6030969 or Valerie Hedin 0879516805

EirGrid is a state-owned company that manages and operates the transmission grid across the island of Ireland. Our high-voltage network brings power from generators, and supplies wholesale energy to heavy users. Our grid also supplies the electricity distribution network. We are responsible for a safe, secure and reliable supply of electricity: now, and in the future. We forecast when and where Ireland and Northern Ireland needs electricity: hour-to-hour, day-to-day, and year-to-year.