A new report by the European Network of Grid Operators (ENTSOE) has shown that Great Britain may not have sufficient electricity generation capacity by 2020 to keep the lights on. This has a knock on affect here in Ireland where by 2022 it is envisaged that we will become more and more dependent on interconnectors.
ENTSOE have placed Britain at the highest risk level of grid blackouts in EU but state that expensive Capacity Mechanisms may prevent them from happening. For the layman reading, this is due to lack of investment in baseload generation - gas, coal, nuclear. Lack of sufficient baseload generation in UK means interconnectors to Ireland will lie idle (where Ireland is also strapped for reliable means of power to export to UK).
Eirgrid this year published their generation adequacy assessments up till 2025.
Take a look at the bottom section which excludes interconnection. Green means we have sufficient generation, red means we don't. By 2022, things start getting tight, by 2023 and 2014 we are in blackout territory, highly dependent on UK to send us spare power.
Of course, we have spent billions on new wind farms. But as ENTSEO state :
The contribution of RES [renewables] for adequacy purposes is less
than for thermal plant.
I've dealt with this concept before - capacity credit. Wind farms don't keep the lights on, power stations do.
There is a further problem for the Irish Grid operators - Eirgrid - and that is the new data centres that are been built around the country. They consume lots of power - Eirgrid estimate that if all the data centres that are contracted are built, they will add a whopping 1,700MW on top of peak demand of about 5,000MW. This would mean we get into the red a lot quicker.
There is a quick fix to this, of sorts, and I hinted at it earlier - Capacity Mechanisms. This involves load shedding - paying factories large amounts of money to close for a period and / or diesel generation which can ramp up alot quicker than power stations. Ireland had about 60MW of diesel generation in 2014 (referred to as Demand Side Units), we now have 230MW ! And Eirgrid have said :
The capacity of Demand Side Units in Ireland has increased to 230 MW, and is set to increase further.
How ironic that the green revolution, the de-carbonization of our grid, the clean, green future has lead to us using more and more diesel generation - the most polluting form of electricity production. And of course, our neighbours England are also going down this path.
Incidentally, the data centres will have back up power in the event of widespread blackouts. No, not windmills, yes you guessed it - diesel generators. The new Apple data centre in Galway will have 18 generators with a total capacity of 288MW. The new green revolution is upon us !
It's an inconvenient fact that the more intermittent renewables you install, the more fast acting generators, like diesel generators, you need to keep the lights on. The rush for green energy will have lots of unintended consequences like this.
- Global annual diesel genset capacity additions are expected to increase from 62.5 GW in 2015 to 103.7 GW in 2024, representing a 5.8% compound annual growth rate (CAGR). Meanwhile, global revenue from the installation of diesel gensets is expected to grow from $41.6 billion in 2015 to $67.9 billion in 2024. Asia Pacific is forecast to be the largest market for diesel gensets, followed by Western Europe and then North America. Leading countries for diesel genset installations include the United States, China, and India, among others.
But that's good news for us, the consumers who benefit from cheaper oil, so bring it on - David McWillams, Irish Economist, February 2016 [Sunday Business Post].
When the Socialist Portuguese government submitted their budget to the EU last week, they were told they had breached EU rules. They then put new measures together including tax hikes on petrol products which were accepted by the EU. The hike was justified "to counteract the environmental impact of low oil prices resulting from increased consumption".
One can see a mainstream Irish government lapping this one up - what a lovely way to raise taxes by telling people higher taxes will be good for them. Of course, most economists know that petrol and diesel are relatively inelastic products - consumption will not be affected much by changes in price. Instead, during times of low oil prices, consumers find they have more in their pocket to spend on other goods and so it should be. People deserve a break and it's good for local economies. But this will end once the watchful eye of the Government focuses on such "easy pickings".
This could well be the hidden General Election issue here in Ireland - none of the Parties nor the media are mentioning it, but after water charges and property taxes, one can easily see an Irish government paying for auction type politics (with cuts in income tax and USC being promised by most of the parties) by putting more taxes on low petrol prices. Fiscal space means more green taxes. It's easier than confronting Apple and Google.
It's also worth noting that petrol is an allowable vouched expense for politicians so they won't be impacted by tax hikes on petrol.
So now you know what to ask candidates when they arrive at your door.
