How will gas reduction affect business

The EU has requested a 15% reduction in gas consumption for winter 2022.

I wonder how this will be managed. Who is in charge of the valve in Ireland? UK, Russia, EU or perhaps Minister Eamon Ryan? In Ireland’s case this is complicated, as we get most of our energy from the UK…not the main European Gas Grid. In 2019, 53% of Ireland’s natural gas was imported from the UK. Currently, it is in the region of 50% to 75% and Ireland is expected to import over 80% of its gas by the mid-2020s.

If we do have to reduce consumption in Ireland, who will be asked to contribute? I believe how gas reduction affects businesses will differ across sectors:

1 - Power generation

Utilities companies producing power use energy like any other industry. But as a consumer of gas, it is a critical industry. What are the options to keep this industry going?

Will we use a reliable course like coal to produce electricity? With Moneypoint Power Station in Clare closed, is this still possible? This isn’t desirable because it contributes to global warming, but it is something that needs to be considered.

Will we need to have power cuts if we don’t use coal?

2 - Manufacturing

I believe manufacturing companies are least likely to see a reduction unless the supply situation becomes even more critical. Instead, the manufacturing industry will be asked to focus on energy management and make reductions that have the least impact to their manufacturing business.

3 - Commercial

With regards to the commercial sector, Covid-19 has already seen that remote working works. Could business operating in this sector shut their buildings for 1 or 2 days a week?

4 - Public

Similar to the commercial sector, is there room for improvement here by shutting some government buildings for 1 or 2 days per week and enable people to work from home?

5 - Householders

It’s domestic use that is likely to see the biggest impact of all. I suspect that householders will carry the biggest burden.

Increased Demand

Electricity demand is increasing, aided by the increase of data centres and electric cars which are becoming more popular, particularly with the fluctuating price of fuel.

If we can’t generate enough energy without gas power stations, there is a high potential for blackouts. Ireland is also the only country in Europe which doesn’t have a gas storage facility since Kinsale Area gas fields were decommissioned so we have no buffer.

Increased Capacity

Ireland is adding capacity in terms of the announcement of the new power station in Dublin’s North Wall. This won’t be ready for winter 22, but it may be ready for some of Winter 23. A second, in Huntstown in Dublin, has yet to receive full approval. Building of these was put into motion a few years ago because of Ireland’s shortage – long before the instability which has happened due to current events.