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InBusiness, February 2004

Electricity matters

Ireland has been lucky to escape the major blackouts that hit countries on both sides of the Atlantic late last summer, but the risk of major power disruption in this country is growing, reports CIAN MOLLOY.

Until long hot summers and/or domestic air conditioning equipment becomes the norm in Ireland, our peak demand for electricity will always be in the winter when weather is the worst.

So far, this year, despite having an electricity supply system struggling to keep up with demand, we've avoided the type of blackouts that affected vast regions in the United States, Canada, Britain, France, Switzerland, Italy, Sweden and Denmark last year.

Nevertheless, Ireland's electricity infrastructure is struggling and lack of progress on power supply transmission is restricting future electricity generation possibilities and the country's industrial and economic development. During the Celtic Tiger years demand for electricity in Ireland grew at four times the average growth rate in EU countries, so that now our per capita consumption of electricity is the same as the UK and is expected to grow at roughly the same rate. However, if these predictions are wrong and demand exceeds supply, the system will collapse. Already there are signs of a system in difficulty, says the president of Dungarvan Chamber of Commerce, Michael Colivet, who says that the town has been blacked-out two years in a row shortly after the Christmas lights were illuminated.

It's a fact of life that if electricity supply can't keep up with demand, you will have system failures. If politics is about power, in a democracy such as ours the growing risk of 'brownouts' deserves greater public debate. One proposal is that we develop an all-island energy market to bring about improved economies and reliabilities of scale, but that is still a particularly shocking proposal to many in Northern Ireland. Another proposal is to set up an east-west interconnector between Dublin and Wales, as a supplement to the existing Moyle Interconnector between Northern Ireland and Scotland.

Lets talk money

These two proposals not withstanding, over the next five years, its planned to spend Euro 5 billion improving Ireland's electricity infrastructure. At present, the ESB is spending Euro 3 million a day on network refurbishment - last year, 15,000 km of power lines were renewed in 2003; with more than 500 poles erected each day.

The investment needed is one of the reasons why the price of electricity in Ireland so expensive. According to the Irish Development Authority, we pay more than double what the French pay for their electricity, 63 per cent more than Americans and about 42 per cent more than the British and the Spanish. While the IDA regrets that the republic of Ireland has higher power costs than many of its rival for inward investment, for the last three years the authority has been pressing government to improve our electricity supply lines as a matter of urgency.

When there is a power failure virtually all businesses, large and small lose money. Intel is one of Ireland's biggest energy consumers and a millisecond's loss of supply can result in the loss of hundreds and thousands of dollars worth of production. But some blackout costs can be rather surprising: last August, an opportunistic thief in Carlow, took advantage of a power failure that had knocked out alarm systems to don a balaclava and mount a spur-of-the-moment raid on a sub-post office!

At present, there are 'all sorts of gaps in the infrastructure', says IDA spokesman Colm Donlon, and because of poor electricity infrastructure is limiting the location possibilities for new industrial projects that use large amounts of electricity.

"According to the national development plan and the national spatial strategy, we should be regionalising our economic development, but we can't do that until we have a proper guaranteed electricity supply across the country. If you go to the northwest, we are still working on an old agricultural supply, even though that region has been prioritised for development. You will also find problems in the southeast around Waterford. Having a quality electricity supply, with no wavering in voltage, totally available 365 days a year is absolutely crucial for the two areas of industry - pharmaceuticals and electronics - that we in the IDA have targeted according to a strategy approved by government.

"One of the problems is that new industries quickly take up any of the existing capacity available. For example, A new data centre in a town can use the same amount of electricity as the town where it's located; a plant like the Wyatt Pharmaceutica will use the same amount of electricity as a whole region.

"We are becoming increasingly restricted in where new companies can be based. Capacity in part of the south west has only been freed up because of the closure of Irish Steel last year."

Why so slow

In fairness to ESB, many of the delays in introducing improvements are due to planning objections. Four years after planning applications were lodged with Sligo, Leitrim and Roscommon County Councils work on the Flagford-Srananagh project will commence. However, An Bord Pleanala recently refused planning permission to upgrade the supply lines in North West Donegal.

"Given the normal complexities of such projects, we estimate that the most likely date for delivery of the final project decided in North West Donegal will be about six years from now," says ESB National Grid transmission asset manager Bernard O'Reilly. "Any significant piece of transmission infrastructure currently takes from five to seven years, and sometimes longer, to take it from initiation, through consultation and planning to construction and completion. This is an intolerably long time and means that potential investors are not prepared to take investment risks where there is a likelihood that adequate supply might not be available."

Many who object to power lines coming through their areas want cables to be placed underground, but burying cable costs between four and 20 times as much as using pylons, says O'Reilly. The quicker a fault in the line is repaired, the less likely significant damage will be caused to other parts of the supply system, but a severed underground cable can take a week to repair while an overhead line can be fixed in a day.

Future planning

At present, ESB National Grid is Ireland's transmission system operator (TSO), but in the very near future that role will be taken over by Eirgrid, an independent body, following an EU directive on electricity market liberalisation. One of the TSO's functions is to produce two annual reports. The first of these is the 'Forecast Statement', which contains information on present electricity demand, generation, the transmission network and interconnection with other electricity systems, such as via the interconnector with Northern Ireland. The second report is on 'Generation Adequacy', which focuses on the minimum generation capacity required to maintain a correct balance between supply and demand.

Future demand is predicted by analysing historical trends, with predictions about future GDP used additionally to project industrial demand and predictions about personal consumption of goods and services used to forecast domestic demand.

During the Celtic Tiger years, when GDP and consumption growth was at its height, demand for electricity increased by six per cent a year, but with the global economic downturn overall electricity demand is expected to only increase by three per cent a year between now and 2009. If the ESRI is found to be too pessimistic in its predictions over the next six years, the outlook for increased power failures because of over-demand will increase too.

While measures are in place to cope with the projected increases, without additional network reinforcement between now and 2009, it will not possible to cope with unexpected increases in demand at sites linked to the following transmission stations: Drybridge in Drogheda, Dundalk, Shankill in Cavan Town, Letterkenny, Sligo, Castlebar, Galway, Athlone, Waterford and Wexford. So other than projects that have already been given the go-ahead, it's not likely that these areas will benefit from additional employment opportunities with companies that use high amounts of electricity.

Furthermore, because of network constraints, the locations where new generators can be located is restricted chiefly to the south-west at present. Connecting additional generators to the transmission system can increase the risk of power failures caused by short circuits and the latest Forecast Statement says "recent connections of generation in Dublin have raised concerns".

Demand demand

In addition, to projecting overall demand, the Generation Adequacy Report (GAR) also predicts how peak demand is likely to increase, so that there is adequate stand-by power available for when demand is at its height. The GAR quantifies the amount of generation capacity that must be added to the power system because of scheduled outages (for generator maintenance) and forced outages (because of unforeseen breakdowns). "The question being answered is whether or not there will be sufficient supply available to be injected into the power system to meet the demand being taken off," says O'Reilly.

Peak demand doubled from 2,000MW in 1983 to more than 4,000MW in 2,001 and the current peak demand record was for 4,415 MW was set on the Tuesday evening January 7 2003 - five per cent more ESB National Grid had predicted for last winter.

Market liberalisation was partly responsible for the unforeseen rise in peak demand, as major customers who had moved on from the ESB to rival generators did not take part in any demand side management scheme. In future, a new scheme to reduce peak-time demand among industrial users will be managed by Eirgrid for all large users of the supply network, no matter who their contracted generator may be.

However, thanks perhaps to global warming, or maybe we have just been lucky, but so far this year's mild winter means that peak demand in January was no where near as high as it was last year.

Change in the wind

At present, generation adequacy is analysed using a Loss of Load Expectation (LOLE) figure expressed as hours per year. In Ireland, the current standard is eight hours loss of load per year, but the standard LOLE in the US is one day in every 10 years. But if we want better LOLE levels it means costlier electricity to pay for having additional, unused, generating facilities on stand-by to cover outages.

Because of wind power's intermittent, and relatively unpredictable, nature, this form of renewal energy cannot contribute significantly to generation adequacy projections. If the wind blows too weak or too strong, wind turbines cannot be used and as a result additional flexible generating plant is needed as back up. Since concerns were raised in the Generation Adequacy Report, ESB National Grid has decided, in a move backed by the regulator, not to sign any new connection contracts with wind farm operators in the immediate future.

Dependence

One of the main features of the big power cuts last summer is that they highlighted how inter-dependent national electricity systems have become. The blackouts in the US spread to Canada because those managing the interconnector between the two countries failed to react quickly enough. Blackouts in Denmark were the result of failures in Sweden and both the British and Italians blamed the French for worsening their power failures because they failed to supply additional power via cross-border interconnectors quickly enough.

If our policy makers sanction the proposal to set up a new east-west interconnector between Dublin and Wales, we may find that we've over extended ourselves. A fault in the network in Sardinia could, theoretically, set of a domino effect that would see a brownout out extended across Italy, France and Britain to this country. What a vision! Europe fully united at last, but totally in the dark!