For generations, keeping the lights on has been almost entirely a matter of science, regulation, and the mundane task of operating large systems involved in the generation and transmission of electrons.
But since Russia invaded Ukraine, that has been reversed, says Paul Deane, a researcher at University College Cork.
“Energy supply is no longer just a question of physics, it is a question of politics. And while the physics is predictable, the politics is anything but.
This week, European Union Commissioner Mairead McGuinness said energy rationing “could be a reality” across the bloc this winter.
So far, the drastic shock to the energy market following the war has been limited to rapid price growth. But even during the relative lull of summer, tempers turn to what winter may hold and fears grow.
It is, in the words of a decades-long veteran in the power generation industry, “without a shadow of a doubt” the biggest risk they have faced in their careers – and the biggest since the country was hit by the OPEC oil crises of the 1970s.
Around 40% of Ireland’s electricity comes from wind power, but electricity accounts for only a fifth of the state’s energy needs. For UCC’s Deane, “being good at 40 percent of a fifth of a problem isn’t much help.” The challenge comes from Ireland’s “massive dependence” on gas if there is no wind.
He predicts Russia will weaponize its gas exports this winter – already seeing the shadows as Gazprom, Russia’s state-backed major oil company, has withheld supplies in recent weeks, blaming sanctions-caused parts problems . “I suspect they will still sell gas to Europe, but the likelihood of Europe and Ireland facing gas rationing in the fall is very real and something we need to be prepared for. If there were a serious disruption, Ireland would be seriously at risk because we depend on others for the transit, production and supply of natural gas, and that supports our economy. If we had four to five days of calm, the electrical system simply wouldn’t work without natural gas. »
Government sources reject the idea that Ireland is particularly exposed. Although they recognize that the price pressures are brutal, Ireland uses almost no Russian fuel. “There is no immediate threat to our gas supplies,” an environment ministry spokeswoman said last week.
Around 70% of Ireland’s gas needs are met via the UK, via a route that runs from Moffat in Scotland to landing points north of Dublin, with branch lines supplying the Isle of Man and Northern Ireland . The UK market is well diversified, with liquefied natural gas (LNG) terminals, storage and interconnection with the Netherlands and Belgium. Much of its supply, and therefore Irish, comes from Norway. Ireland also gets about 30% of its needs from Corrib.
However, John Mullins, former managing director of Bord Gáis, is concerned about the nature of the deals with the UK. He and others worry that the agreements that underpin the transfer of gas to the state are untested in emergencies and in the post-Brexit world.
“We assume that in an emergency the UK will keep the floodgates open,” he says. “We don’t have cast iron supply security when it comes to gas, and therefore this extends to electricity.” In the event of a genuine supply shortage, the EU could require Norwegian gas to be sent to markets where Russian gas has been cut or failed. This could lead to loopholes in the UK, raising fears that domestic political considerations may outweigh obligations to Ireland. The parallels to other Brexit fallout are clear – if it happens, Mullins warns, “the [Northern Ireland] the protocol will be the least of our worries”.
Government sources accept that transporting gas from the UK is governed by trade agreements rather than international treaties. But Ireland is not without playing cards: the same line that supplies our market goes to Northern Ireland, while Ireland exports more electricity via the interconnection of the electricity systems of the two islands than she receives none. While security of supply was on the agenda of a meeting between Environment Minister Eamon Ryan and his British counterpart last week, coalition sources are confident the arrangements are sound. “There are people trying to get a lot more out of it than there is, but that’s certainly not something we’re particularly concerned about,” a senior source said.
The government may believe something like this is unlikely – but sources have admitted supplies will be tight across Europe. However, predicting what will happen beyond that is more difficult. “There’s a difference between losing a little and losing a lot and it’s absolutely huge,” said a well-placed Coalition source.
The weather is an important factor: a mild or cold winter could mean a 10 to 15% variation in gas demand. If supply were to tighten during a cold snap, the political and social effects would be much more severe.
In the first case, the price would probably increase further. The price is already clearly affecting the economy and society here – but as a wealthy country Ireland is still relatively protected, even if it doesn’t feel like it, because it can afford to pay. Already, the state is taking advantage of the combined ability of the UK and Irish market to pay for LNG that would typically flow from the Gulf states to poorer countries – with Lebanon and Pakistan already suffering from shortages. More price spikes would mean greater government demand to support household energy bills, something the Coalition is already preparing for this winter.
If gas were rationed here, there is an order of merit as to who loses access first: homes, hospitals and other vital infrastructure are protected; but quarries, factories and data centers would all be required or asked to restrict use, Deane says. The potential economic consequences of this are clear, from lost wages to damaged business profits and tax revenues.
Worst-case scenario planning is already underway – and of course it extends beyond gas and into petroleum-based fuels as well. The government has already convened an emergency group for energy security (dubbed “Nphet for energy” by some), which includes subgroups for gas and oil. The latter modeled three scenarios during an emergency planning exercise in recent weeks, where losses of 20 to 50% in the availability of petroleum products were modelled. A dedicated network of service stations would serve only essential vehicles, such as emergency services or food transport fleets. In more severe scenarios, all non-essential gas stations would close, de facto canceling private driving, said sources with knowledge of the plans. In the worst-case scenario, where a shortage of gas combines with a major shortage of petroleum products, sources said choices could be forced between competing energy demands such as harvesting food and producing energy. “It’s spooky, spooky,” said a source involved in the planning.
Industry figures believe work-from-home mandates, or days when cars with odd or even number plates aren’t allowed to drive, were all planned.
All of Ireland’s gas-fired plants can run on “liquid alternatives” – usually diesel, and retain a full 10 days’ supply – which in reality is probably longer as they wouldn’t be shut down for that long in a row. Scenario planning, sources say, revolves around planning how factories could share supplies if needed, or how many trucks are needed to redeploy fuel.
Security of supply
There is some resentment in the industry among those who believe Eamon Ryan has failed to address concerns over security of supply – it is understood these concerns were flagged in recent meetings with responsible. Asked about McGuinness’ comments on RTÉ on Friday, Ryan acknowledged it was a “difficult time”, saying Ireland was in a different situation to other countries due to its lack of connection with Russia. He promised that in the event of a disruption “we would be able to respond immediately” and said he did not expect to have to restrict supply.
Others are frustrated that the delays have hampered investments in the power grid that would make the system more resilient. “The big problem here is that we’re not eliminating the bottlenecks in the system that will allow us to provide this kind of infrastructure,” says an industry veteran.
Others in the industry are annoyed that regulatory decisions that could assuage medium to long-term security of supply concerns are stalled in the department. Brian O’Cathain, a former Tullow Oil executive who was also involved in the development of the Corrib gas field, is trying to explore a gas prospect – Inishkea – which he believes could pick up where Corrib left off when it is exhausted. His company, Europa Oil & Gas, is requesting an extension of its exploration permit which expires at the end of July but has no decision from the department. They fear that if it expires, the government ban on issuing new licenses will mean it will never be operated. He says Ryan has “a blind spot on indigenous oil and gas exploration” that is driven by “ideological reasons.” The company estimates that the yield could hold enough gas to meet the needs of Irish households for 17 years.
“For lack of knowledge and understanding, we can disable the only possibility we have of extending the life of a major gas asset, in fact the state,” he says.
Insiders fear that even if the worst-case scenarios do not materialize, consumer sentiment could be shaken and consumption habits could change. The feverish atmosphere could lead to unexpected spikes in demand, as seen in the UK last winter, where people who feared a shortage of supply helped cause one by queuing at pumps .
With global markets rocked by uncertainty and reduced odds of further shocks, the consequences of instability are already clear – and the political fallout from a winter of discontent would be severe.