By Pádraig Hoare
The energy regulator has said €200m will be saved by consumers in the Republic and the North after a revamp of the electricity market, despite a power plant operator announcing it will close two power plants.
Energia owner Viridian said the revamp of the so-called capacity payments system has led to it deciding to close two of its plants in Dublin.
Under the shake-up of the electricity market designed to lower electricity costs across the Republic and the North, an auction was held in December to decide which power plants would receive capacity payments and which would miss out.
As well as Viridian’s Huntstown, Co Dublin power plant, AES-owned Kilroot in Belfast and Ballylumford in Larne missed out on the payments. Both Kilroot and Ballylumford stations are now under threat with hundreds of jobs on the line, it was confirmed last week.
Viridian said it would close its two plants in Dublin after the Commission for Regulation of Utilities (CRU) approved a subsidy to one of its facilities, but not the other. Running one was not viable, it said.
Capacity payments are made by grid operators Eirgrid in the Republic and System Operator Northern Ireland (SONI) to generators like Viridian, AES and the ESB.
In the electricity market, generators are paid for the energy they produce and they also receive a capacity payment for being available to produce. Capacity payments are given to maintain power plants.
A spokesman for the CRU said the revamp of the capacity payment system was done with the consumer in mind. “The key objective... is to deliver a more competitive electricity generation market, focused on delivering services customers need at the least possible cost and maintaining security of supply,” he said.
It will result in savings of approximately €150m to energy consumers in the Republic and a further €50m for consumers in the North, he added.
The CRU spokesman said some closures had been envisaged and insisted the grid would cope with the plant losses.
“It had been expected that this may also result in some generators taking the commercial decision to close particular plants. In the event of this, there remains sufficient generation capacity on the island of Ireland, with some areas of local constraint,” he said.