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Thursday, October 1, 2009Eirgrid says demand for electricity set to fall further
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INM board member warns of difficulty of having minority stakes in firmsFall in home loans for fifth month in rowBARRY O'HALLORANDEMAND FOR electricity is set to continue falling in the short term while the economy remains in recession, according to the national grid operator.

Dermot Byrne, chief executive of Eirgrid, the agency that operates the State’s electricity transmission system, told an Oireachtas committee yesterday that it believes demand for power will fall by between 4 per cent and 5 per cent this year, and by 1 per cent to 3 per cent in 2010.

Based on predictions from groups such as the Economic and Social Research Institute (ESRI), Mr Byrne said Eirgrid expects demand to begin to increase from 2011 as the economy starts growing again.

He also pointed out that demand for electricity in the Irish economy was less intense as a result of the shift to services from manufacturing.

Mr Byrne also confirmed that the system is on track to meet the Government’s green energy target for next year.

The Government wants 15 per cent of all electricity used in the Republic to be generated from renewable sources.

Mr Byrne told the Oireachtas Joint Committee on Climate Change and Energy Security that renewables, mainly wind and some hydro power, on the Irish system have the capacity to generate up to 1,161 mega watts (MW) of electricity.

A further 200 MW is needed to bring that up to the 15 per cent required by next year. Mr Byrne said there is more than 400 MW due to come on stream over the next 12 months, meaning that the Republic will meet its target comfortably.

Eirgrid is also opening the debate on where energy is likely to come after 2020, including looking at the option of nuclear generation.

The agency is commissioning research on the options, which include gas and renewables combined, “clean coal” replacing gas, nuclear replacing gas, and various scenarios involving 80 per cent renewables.

Eirgrid is building a 500 MW interconnector between Ireland and Wales. Mr Byrne said yesterday it would be seeking a €110 million grant from the European Commission for the project.

The European Development Bank is loaning €300 million to the project.

Mr Byrne told the meeting yesterday that in the medium term, Eirgrid believes that more interconnectors, either with Britain or the Continent, would benefit the Irish system, and result in savings in both cost and carbon emissions. It plans to release a further report on this later this month.

This article appears in the print edition of the Irish Times