Gas demand returning to normal in most sectors

Hotel, leisure and related activities the outlier | Gas continues to provide bulk of Ireland’s power generation needs.

Natural gas has provided close to 80% of power generation at times over the last week according to figures to Eirgrid Fuel Mix figures, and with wind levels tending to be lower in summer, reliance on gas is likely to remain strong in the coming months. Gas demand for power generation was strong throughout May and has continued into June, with 53% of power generation for the period 15 May to 15 June stemming from natural gas.  As wind levels drop, gas has the flexibility needed to power up and down quickly, making it an ideal partner to variable renewable energies. 

Gas Networks Ireland’s Head of Regulatory Affairs, Brian Mullins, said the figures clearly show the continued importance of gas in powering the nation.

"Gas helps ensure the lights stay on, essential services stay running and businesses can keep operating as needed," Mr Mullins said. "Ireland’s gas network is the solid foundation of our energy system, supplying approximately 30% of all energy and 50% of our electricity. We see its flexibility particularly in the summer months, when renewables drop off."

With the Covid 19 lockdown easing nationally, gas consumption has returned to near normal levels in most sectors of the economy.  Gas demand in May was 4644 GWh, compared to 4570 GWh in April.  In the first week of June, demand was strong across most sectors of the economy as restrictions were eased on the economy and more businesses re-opened.

“Recent weeks have seen an uptake in gas demand to bring us close to normal levels for the time of year. Energy demand remains one of the best barometers for economic activity and the increase in gas usage nationally is an encouraging sign of the economy beginning to recover,” Mr Mullins said.

The first commercial flows of renewable gas commenced in May from a new entry point in Cush, Co Kildare.  This is the first designated renewable gas entry point in Ireland and joins Corrib and Kinsale as the three indigenous supply points on the network. Once fully operational, Cush has the capacity to heat 11,000 homes. 

“Gas Networks Ireland’s goal is to ensure we continue to deliver the secure energy supply that Ireland needs, while further decarbonising our gas supply. The recent opening of the Cush injection facility, bringing a constant supply of renewable gas onto our network is an important step forward in that goal,” Mr Mullins said. Analysis by Gas Networks Ireland shows that as streaming services and video calls to relatives became part of everyday life, gas demand from the data centre sector in particular was strong, up 24% year on year. This is anticipated to grow in the coming years.

Demand from a number of sectors, including Biomedical, Pharma and Food and Beverage, remained strong throughout the lockdown period.  Energy demand levels suggest that these sectors have so far remained relatively resilient against the economic downturn.  Gas demand from manufacturing industries is slightly down on previous years. Residential gas demand is in line with normal years, given the weather and time of year, while retail is slightly down but broadly on trend with previous years. 

With hotels and other leisure facilities closed until the end of June, demand has plummeted in this sector. Supporting industries, particularly laundry service providers who supply bed linen and towels to hotels and other hospitality venues nationally has also fallen. With anecdotal reports from staycationers of strong bookings for the remainder of the summer, we expect demand to recover from the end of the month.

“The data gives us some interesting insights as to the state of the economy and a better understanding of how our energy supply is operating in the current environment,” Mr Mullins said. “While people have correctly heeded the call to stay at home, impacting on economic output, there are a number of sectors that have continued to operate, to keep society functioning, with gas playing a key role in the continued supply of electricity across the island.”

Gas Networks Ireland owns, operates, builds and maintains the €2.6 billion network that ensures the safe and reliable delivery of gas to over 700,000 Irish customers, including businesses, households and power stations.