Some relief may be in store for Irish households and businesses when it comes to energy costs, with one analyst predicting the short-term power market price in Ireland could fall by over 18% this year.
Cornwall Insight said higher than anticipated gas storage levels in the EU have reduced concerns that there could be shortages in supply over the remaining winter months.
In turn this could mean that that come the summer less gas will be needed to be refilled, leading to lower prices.
“With the EU’s boosted gas reserves cutting prices, it is hoped this will lead to a much needed reprieve for households and businesses who have been struggling with a cost of living crisis,” said Sarah Nolan, Senior Modeller at Cornwall Insight.
However, the organisation also warns that Europe continues to have an increased reliance on Liquified Natural Gas (LNCG) because of sanctions on imports from Russia.
This will keep Irish prices above historic averages, it said.
Prices are expected to continue to drop in the medium term as Ireland works towards its target of having 80% renewable energy by 2030, Cornwall Insight added.
But nevertheless, in 2029 they are predicted to rise again due to higher demand from data centres and the shift to electric power in various sectors, alongside an increase in exports.
As a result, Irish prices will likely remain above pre-2021 averages out to the end of the decade,
“While Irish energy prices will likely remain higher than pre-crisis levels for the foreseeable future, Ireland’s renewable ambitions are pushing towards a more stable and sustainable energy future,” said Ms Nolan.
“The energy landscape is changing, and while the road ahead may not be smooth, Ireland is firmly on the right track,” she stated.
A number of retail energy suppliers have already begun cutting their prices in response to the fall in wholesale costs.
However, charges still remain well above the levels they were prior to the start of the Russian invasion of Ukraine.
The Government is providing three €150 energy credits over this winter, with the first paid in December, another due this month and the last in March.