Gas and electricity prices remain below last year’s levels

Wholesale gas and electricity prices rose last month but still remain well below prices for the same period last year.

Gas prices rose 17% month-on-month on account of a number of unplanned outages that put pressure on the system to meet demand, but still remain more than 20% lower than this time last year.

Day-ahead prices have fallen 24% since the beginning of the year.

With a milder than usual start to winter expected and near-full storage in the UK market which is a major source of supply into Ireland, demand is anticipated to remain at or below seasonal levels.

“Storage stocks remain high and demand has been depressed which means we have seen a continuing drop in gas prices year on year,” said Vayu senior energy analyst, Joanne Daly.

“While prices rose this month... the market remains fundamentally bearish due to current record high levels at the UK storage sites and ongoing mild weather.

“For longer dated contracts that have been elevated by Russian gas supply risk, continuing talks between the EU, Russia and Ukraine is hopeful of bringing stability to the region and energy markets.”

Irish electricity prices also rose in August, by 19%, but are still down almost 12% on the same period in 2013.

This, according to the Vayu energy report, is mainly due to slightly higher month on month gas prices, as well as a lower contribution of electricity generated from renewable sources.