Electricity prices will stay at current levels despite economic growth and the building of data centres boosting demand, according to Moody’s Investors Service, writes Eamon Quinn
Demand will rise significantly in the coming years putting pressure on prices, which will also be under pressure from increases in carbon taxes and the requirements of data centres in particular.
Nonetheless, Moody’s predicts prices at €44 per megawatt hour next year “will remain low by historical standards”, while in future years the increase in onshore wind supply in the Republic will help capacity in the all-Ireland electricity market.
And generators ESB and Viridian will be relatively unscathed by the continuing low prices, according to the in-depth report.
“Low prices largely will reflect the continued growth in onshore wind, but this will be partly offset by growth in domestic demand of around 2% per annum; a gradual increase in gas and CO2 prices; and continued demand from Great Britain via inter- connectors.
“Due to the uncertainty arising from the new wholesale market structure — the Integrated Single Electricity Market, which is due to be implemented from 23 May 2018, our estimates have assumed no impact on prices,” the report said.