EirGrid’s Generation Capacity Statement Predicts Challenging Outlook for Ireland

06 October 2022

This year’s Generation Capacity Statement (GCS) has been published by EirGrid and predicts a challenging outlook for Ireland, with capacity deficits identified during the 10 years to 2031.

In the short term, deficits will increase due to the deteriorating availability of power plants, resulting in their unavailability ahead of intended retirement dates.

In later years the deficits are expected to reduce as new capacity comes forward through the Single Electricity Market (SEM) capacity auctions.

Mark Foley, EirGrid chief executive, commented: “Since 2016, the GCS has warned of an increasing tightness between demand and supply. This year’s GCS forecasts significant electricity supply issues over the coming years with an increase in the tightness between supply and demand. 

“The number of system alerts will increase as our economy grows, electricity generators exit the market and demand increases, with significant new additional demand from the heat and transport sectors as they are electrified.” 

According to the report, generator performance continues to be poor and it is assumed that some generation capacity, due to close in September 2023, is not available for either 2022 or 2023.

Since last year’s GCS, 365 MW of previously awarded capacity has been withdrawn and the developers have paid termination charges. This is in addition to the previous 266 MW which terminated. This means that most new capacity that was expected to come online over the coming years has now withdrawn.

Trends in the data centre sector show demand levels around 140 MW higher by 2030 than previous forecasts. There is very strong growth in this sector out to 2024, with continued growth towards the end of the decade.

This growth is from contracted projects. As per the directive from the Commission for the Regulation of Utilities in November 2021, data centre projects that do not have connection agreements will be assessed on new criteria.

To address the overall challenge, the Commission for the Regulation of Utilities (CRU), has developed a programme of actions that will be delivered over the coming years.  These include:

  • The delivery, through the all-island capacity auctions, of over 2,000 MW of enduring flexible gas-fired generation capacity by 2030.
  • Procurement of 700 MW of temporary emergency generation.
  • Extending the operation, on a temporary basis, of older generators to delay the loss of up to 1,200MW of capacity.
  • Actions to enhance demand side responsiveness​.
  • The introduction of tariffs to reduce electricity demand at peak times

The GCS, in its median forecast, estimates in that demand for electricity will increase 37% by 2031.

Under this scenario, the residential, commercial and industry sectors remain relatively consistent across the decade.

The largest growth comes from the data centre and new large energy users, and an increased uptake of electric vehicles and heat pumps, particularly later in the decade.

Also notable is that by 2031, 28% of all electricity demand is expected to come from data centres and other new large energy users.

The Winter Outlook provides a more detailed technical assessment of this coming winter and is available here.