Wholesale gas prices are 8% higher compared with the average monthly price recorded for August 2017 as maintenance and outages cause supply issues, according to this month’s Vayu Energy report.
The proprietary market review and forecast for Northern Ireland’s wholesale gas, electricity and wind energy reports that the increasing prices have been tempered by the recent pick up in sterling against the euro as strong economic data in the UK presents a more positive foreign exchange picture.
The average day ahead price for gas, the contract for gas delivery tomorrow, is 46.26 p/th (pence per therm) for September. This compares with an average price of 28.49p/th in September 2016.
Commenting on the report Vayu Senior Energy Analyst, Keith Donnelly, said:
“As expected, there is considerable energy price volatility for gas customers in Northern Ireland. Norwegian supply volatility is framing the bullish atmosphere that clung to the prompt market over the course of September.
“Norwegian supplies fell due to unplanned and planned outages, causing prices to rise slightly from August’s close. Production from the Corrib gas field was halted after the odourisation process failed causing safety concerns. This led to a slight increase in demand for the UK as Corrib gas on the island of Ireland was replaced by UK sourced gas.”
He added: “With supply diminished, prices continued to rise reaching a peak of 48.55p/th. Risk and volatility are the buzz words as the UK is on the cusp of its first winter without its largest gas storage facility.”
Electricity and Wind Energy Update
The average wholesale price of electricity in the market in September is 4.17 p/kWh, an increase of 36% compared with September 2016 and up 9% on August. The increase in prices can be attributed to the rise in prices in the gas market, while the continued strong levels of wind generation has limited the uplift. Wind generation as a percentage of total generation, has risen by over 25% compared with wind generation last month.
Total wind generation capacity on the island of Ireland still stands at 3,916 MW. However this month wind energy has accounted for approximately 27% of overall electricity generation on the island of Ireland, compared with 22% last month. Wind generation peaked at 2,959 MW on 23rd of September. This peak generation had the potential to meet 67% of total electricity demand on the island of Ireland at that time.