Energy [Ireland] 2018

December 2018

Energy

The administrations in Ireland, Northern Ireland and the UK have cooperated  actively on energy policy for many years and the stated preferred intention is that they will continue to do so, where possible and mutually beneficial.

There has been sustained political commitment in each jurisdiction to the  development of competition in the energy sectors in the interests of delivering improved services and economic benefits to all market
stakeholders.

The all-island Single Electricity Market (SEM), a single, trans-border electricity market between Northern Ireland and Ireland is in place since 2007 and has its regulation underpinned by the EU Internal Energy Market legislation, including the Electricity Directive, Electricity Regulation, the
Agency for the Cooperation of Energy Regulators (ACER) Regulation and associated EC Regulations, supported by domestic legislation that provides a framework for the single wholesale electricity market .

This is a unique arrangement; although the EU has been working towards the closer integration of energy markets across Europe, it is only on the island of Ireland that a single, trans-border electricity market has been established.

Effective operation of the SEM is based on EU rules governing technical  operation of, and trading in, electricity systems and markets. Other vital elements include EU state aid rules, EU rules on data sharing and management, and EU market surveillance rules. In addition, EU policy frameworks in the areas of environment and climate change (e.g. carbon pricing, the EU Emissions Trading  system/industrial emissions) are also necessary for the effective functioning of the SEM.

To ensure that the SEM can continue to function without disruption, Ireland is engaging intensively with the EU on this important issue.

Gas Trading

Gas trading between Ireland and the UK is currently governed by EU Internal Energy Market legislation, as well as a series of contracts and agreements between the transmission system operators in both countries. The gas markets in Ireland and Northern Ireland are supplied by gas transported across wholly Irish-owned pipelines between Britain and Ireland (including via a spur to Northern Ireland from the part of the Irish pipeline out of Scotland) In the event of disruption to this route, there is a back-up route for providing gas to Northern Ireland via the interconnector from Scotland, and the South-North Pipeline – which is regulated by the Northern Ireland regulator – which joins the interconnector in Ireland to the Northern Ireland network. As in other areas, supply chains are also highly interlinked in the energy sector on the island of Ireland. There are existing arrangements between Ireland and United Kingdom transmission systems operators in the event of an emergency.

No deal Brexit contingency planning, indicates that IE-UK gas trade will not fundamentally change in short-to-medium term, though clarification is needed on certain issues, such as access of UK TSOs such as GNI UK to the gas trading software platform.

The electricity and gas trading contingencies are being examined as part of an on-going engagement with DG Energy and the EU Commission TF50

July 2019

Energy

Contingency plans for the Irish electricity and gas wholesale and network sectors have been prepared by the Commission for Regulation of Utilities in Ireland (CRU) and the electricity and gas system operators – EirGrid and Gas Networks Ireland, respectively. These plans will ensure the ongoing operation of the electricity and gas markets and networks in a no deal Brexit. In addition, emergency plans are in place to minimise supply disruption in Ireland in the event that the gas and electricity interconnectors cease flowing, although such a scenario is not anticipated.

The CRU published a notice to industry in March, stating that in a no deal Brexit, trade with the UK in gas and electricity will continue, the SEM will continue to operate, Prisma (the software for cross-border trade in gas) will continue to be used, and gas will continue to flow. The notice also states that trade through the electricity interconnector may be less efficient as some platforms operated under EU rules may not be used in the same way, and that it will seek to minimise this loss in efficiency through working in conjunction with the Department of Communications, Climate Action and Environment (DCCAE) and EirGrid and through engagement with the European Commission, with such work already commenced through changes to the operation of the SEM intraday auctions to improve liquidity.

EirGrid has plans in place to ensure ongoing trade and security of electricity supply on the East-West Electricity Interconnector in a no deal Brexit. The CRU, as regulator, and EirGrid, as market operator and owner of the East-West Electricity Interconnector, will continue to engage on revised trading arrangements consistent with the UK’s status as a third country.
Gas Networks Ireland also published a notice on a no deal Brexit in March, stating that there will be no adverse impact on gas flows due to Brexit. The pipeline operators involved in the flow of gas from Scotland to Ireland/Northern Ireland have formally agreed that all relevant contracts facilitating the daily flow of gas from Great Britain to Ireland will continue to operate as they currently do.

The Irish Petroleum Industry Association (IPIA) has indicated that their member companies have no concerns around the continued availability of oil supplies, including refined product, post UK withdrawal.

DCCAE is working with the CRU and the electricity and gas transmission system operators to contain, as far as possible, any consequence for the SEM due to Brexit. Cognisant of Ireland’s ongoing obligations as an EU Member State, discussions on the technical, operational and legal aspects of the SEM are ongoing between DCCAE and the Northern Ireland and the UK authorities, and between the relevant regulators and system operators.
The Brexit Omnibus Act contains provisions giving the CRU the ability to modify licences expeditiously in a no deal Brexit to facilitate the continuing operation of the SEM, in line with Ireland’s obligations as an EU Member State. If necessary, this temporary measure will be in place for one year from commencement.

Celtic Interconnector

The Celtic Interconnector is a proposed 700 MW High Voltage electricity interconnector that would provide the first direct electricity link between Ireland and continental Europe, addressing the critical need for Ireland to be connected to the EU’s Internal Energy Market post Brexit. Ireland’s integration into the European electricity market would improve security of supply and lower carbon use by incorporating greater quantities of renewable energy. The project is designated an EU ‘Project of Common Interest’ (PCI), meaning it is considered an energy infrastructure project of the highest priority.

Recognition of Qualifications

Under EU legislation, those working with F-Gas equipment (primarily in the refrigeration, air conditioning and heat pump sectors but also fire suppression, mobile air conditioning and electrical switchgear) must be certified, and it provides for the mutual recognition of certificates obtained in EU Member States. When the UK becomes a third country, arrangements for the mutual recognition of qualifications and certificates from UK institutions will cease to apply.
The Brexit Omnibus Act provides for the recognition of existing UK certificates for a defined period after Brexit; it gives holders of such certificates time to apply for an Irish certificate and allows them to continue carrying out activities relevant to their qualification within a defined timeframe.

Next Steps

 DCCAE will continue to engage with CRU and the electricity and gas transmission system operators in relation to their contingency planning and seeking as far as possible to minimise Brexit consequences to electricity and gas markets.

 CRU and EirGrid will continue to engage on the development of revised trading arrangements for Interconnectors consistent with the status of the UK as a third country.

 DCCAE will continue to engage with the Northern Ireland and UK authorities, and with the relevant regulators and system operators on the SEM, cognisant of Ireland’s ongoing obligations as an EU Member State.  Engagement with the European Commission will continue as appropriate.

 DCCAE will put in place secondary legislation to allow for recertification in the FGas sector in advance of 31 October, and will continue to engage with relevant stakeholders in relation to checking and processing F-Gas certification.