Ireland could become almost completely dependent on gas supplied via the UK within four years, with concerns over the future capacity of key infrastructure to handle peak demand, Government documents reveal.
Three-quarters of gas used in Ireland comes via the UK. A June meeting of the Energy Security Emergency Group, the body steering the State response to the crisis, heard that “due to the limited and depleting gas source from [the] Corrib [gas field], by 2026 or 2027 Ireland may be almost 100 per cent dependent on gas supply via interconnectors to the UK”.
There are worries over whether gas pipeline infrastructure can handle peak demands when this happens.
“Concerns were raised that demand may exceed the capacity of these pipelines during peak days and that upgrade works are likely to be required,” meeting minutes state.
It comes amid increasing expectation that a windfall tax on energy companies will form part of the budget, while the Government could also demand extra dividends from State-owned electricity companies, it has emerged.
Opposition politicians have been demanding windfall taxes on energy company profits as families face autumn increases that could push total household bills past €4,000 a year.
The Department of Finance confirmed on Wednesday that Government is considering including the tax in September’s budget, but cautioned that the move could further increase energy bills or hit investment in badly needed new generators.
“Changing tax rates or imposing additional levies on certain sectors could have unforeseen consequences,” said the department.
Its statement also noted that the State owns energy companies so “a change in dividend policy could be more effective in amending the amount recouped” by these businesses.
Minister for the Environment Eamon Ryan confirmed the measures were under examination to fund new supports for business and households in the budget.
In a tweet which was hastily deleted, the Green Party leader said the charge would be implemented. It was replaced with a second tweet which said it was merely under examination — but party sources confirmed the Greens favour the intervention and want to see it in the budget.
Ireland’s dependence on the UK has led to calls for the construction of a Liquified Natural Gas terminal, which is opposed by the Green Party. The fresh concerns add to short- and medium-term worries over Ireland’s energy security, and the measures to support households and businesses exposed to record energy prices this winter.
The Oireachtas climate committee is to meet next Tuesday, following a call from Sinn Féin to bring in the Commission for Regulation of Utilities, EirGrid and Mr Ryan.
Records show that the Energy Security Emergency Group discussed windfall taxes in early June, and talks were due to happen over the “technical feasibility of taxing potential windfall gains in the gas and electricity sectors”.
Documents also show that the supply of diesel in Dublin’s fuel terminals, which supply about half the country, dipped as low as two days’ worth in April. Industry sources said this was not unheard of — but that the sudden tightening of supply when Russia invaded Ukraine made it a vulnerability.