Ireland Takes Fresh Look at US LNG

Despite fears that LNG imports will bust Irish plans to reduce greenhouse gas emissions, New York-based New Fortress Energy hasn't given up on a project to bring US cargoes into southwest Ireland. Subsidiary Shannon LNG said last week it will soon file a planning application for a gas-fired power station and LNG import terminal in County Kerry. It said the 600 megawatt combined cycle plant will "back up renewable generation and will have an integrated 120 MW one-hour battery storage facility for ultra-fast response." It will take LNG from a floating regasification and storage unit, and then either send gas to the power station or inject it into the national grid. The company unveiled the plan after an Irish court struck down its earlier bid to build an LNG plant on the same site in Ballylongford. Ireland fell out of love with LNG after the Green party joined the coalition government in June 2020. The 3.6 million ton per year Shannon LNG was one of two projects shelved, mainly on environmental grounds. Irish policymakers were worried that LNG imports from the US would push up Ireland's greenhouse gas emissions (WGI Feb.3'21). Similar environmental concerns in France prevented utility Engie from buying LNG from Texas-based Rio Grande LNG (WGI Nov.11'20). A third project, a floating unit based on existing infrastructure in the Kinsale fields -- which stopped producing last year -- is still in the works. Shannon LNG will submit the new application amid growing concerns about security of electricity supply. Gas accounted for 51% of electricity generation in 2020, when overall gas demand totaled around 6 billion cubic meters (580 million cubic feet per day). Wind was on roughly 37%. The Irish government wants renewables to make up 70% by 2030, with gas likely accounting for much of the remainder. Right now, most gas comes from the offshore Corrib field. But with Corrib output dwindling, the country could have to import 90% of its gas via a pipeline from Scotland by 2030. Moreover, gas and coal provided more than 80% of the country's electricity when wind and solar conditions were poor last week. Electricity demand is meanwhile growing, largely due to demand from data centers, which use massive amounts of power. A study done in 2019 suggested data centers and other large energy users could account for 31% of demand by 2027. Irish transmission system operator Eirgrid reckons up to 950 MW of gas-fired capacity will be needed to meet about 30% of expected incremental demand. Last week, it applied to build the 700 MW Celtic Interconnector with France. If operational from 2026, as planned, this would flow predominantly nuclear-generated electricity to Ireland. Environment Minister Eamon Ryan confirmed in July that Ireland will continue with a "moratorium on the development of LNG import terminals pending the completion of a review of security of supply." This should be finished next year. He said the government does not support imports of gas produced through hydraulic fracturing," adding that "fracked gas causes environmental damage both locally where it is extracted and globally, and Ireland, having banned its exploitation onshore, should not impose these environmental risks on other communities around the globe." But he said Ireland could not ban the imports without changes to international rules, such as European energy laws. Ryan is pushing for the changes as part of an upcoming revision of EU gas directives and regulations. Jay Eden, London