Electricity prices in Northern Ireland are set to rise later this month. NIE has confirmed that it is to meet the energy regulator on Friday to review tariffs for both domestic and business users. Sharp increases in wholesale prices of oil, gas and coal are being blamed for the anticipated increase. The energy regulator, Iain Osborne, has already said he expects costs to increase by as much as 30% before the end of the year. NIE has not said how much of an increase it is seeking, however, electricity bills in the rest of the UK have risen by an average of 14% since the start of the year. It is thought that customers are likely to face an increase of around of 15% in the short term.

ICIS, the commodity market information business of Reed Business Information UK Ltd, has today announced its acquisition of Heren Energy Ltd. Heren Energy is Europe’s leading gas, power and carbon market information provider and this acquisition provides ICIS with the opportunity for greater geographic coverage of international energy markets and additional sales points for Heren products through the global network of ICIS offices. The acquisition also provides the opportunity to broaden the spread of markets currently covered by Heren, as well as providing support for entry into new vertical energy markets. In line with other energy commodities, gas and power markets have seen a period of unprecedented high and volatile prices. In Europe, markets are liberalising; this is a key driver of future growth as is reflected in the UK experience of liberalised energy markets. ICIS Publishing Director, Christopher Flook said: “The acquisition of Heren Energy Ltd provides ICIS with a strong opportunity to extend our footprint outside of petrochemicals and into other energy markets. There are strong synergies between ICIS and Heren, driven by Heren’s first mover advantage in this market and strong reputation and the ICIS core competencies of price reporting, online content delivery and web marketing.” Heren is highly regarded for its integrity, reliability and editorial excellence. The authoritative multi-lingual reporting staff deploys their knowledge across the wider commercial, economic, regulatory and legal spectrum to provide a rich and comprehensive analysis of market movements that define the energy marketplace. These impartial gas and power indicators are industry benchmarks, used extensively throughout Britain and Europe for short and long-term contracts as well as forming the basis for retail market gas and power tracker tariffs for key industry players including nPower and Centrica. Patrick Heren, Publisher and founder of Heren Energy said: “This is an exciting opportunity for Heren Energy. The global reach of ICIS will bring significant benefits to the Heren business and customers as well as providing the framework of a large organisation to facilitate organic growth.”

Energy Minister Eamon Ryan today in Belfast, along with his Northern counterpart Nigel Dodds and EU Energy Commissioner, Andris Piebalgs, formally launched the all-island Single Electricity Market. Under this new market, 2.5 million electricity customers (1.8 million in Ireland, 0.7 million in Northern Ireland) have become part of a single competitive, sustainable and reliable market in wholesale electricity, run on an all-island basis. The Single Electricity Market is a considerably larger market than the two single markets operating independently, hence economies of scale will encourage the entry of new market participants, both generators and suppliers. This in turn will lead to lower cost of generation, increased security of supply and ultimately lower electricity prices for consumers than if the markets had not been combined. Speaking at the Waterfront Hall in Belfast, Minister Ryan thanked those who strove to make the market a reality, “Today’s announcement marks the culmination of several years of very intensive work undertaken north and south, which began in 2003. The creation of the Single Electricity Market is a tangible example of the long-standing active co-operation taking place on an all-island basis, on common energy issues. Indeed, I believe that our long-term energy future lies not as two distinct energy markets isolated from the rest of Europe but rather as part of a regional energy market in conjunction with Britain and with other European neighbours.” While in Belfast, Minister Ryan also held a bilateral meeting with Commissioner Piebalgs to discuss current issues on the EU Energy Agenda including renewable energy and the internal market liberalisation package. “The IEA’s report last week should be a call to action for all governments that ‘business as usual’ energy policies cannot continue. We need urgent action if the alarming scenario outlined by the IEA is to be avoided. The y tell us of runaway energy demand and vastly increasing carbon emissions if we do not immediately alter our energy policies

The United Kingdom utility National Grid PLC said Friday it is close to overcoming the final hurdle in its $7.3 billion acquisition of U.S. utility KeySpan Corp. by reaching an agreement in principle over the terms of the deal with the New York State Department of Public Service.

The entire EU energy market was thrown open to competition on Sunday 1st July, allowing consumers to choose their gas and electricity suppliers and spelling an end for monopolistic state-run utilities. The liberalization process has been resisted in some countries and welcomed in others, highlighting different attitudes to competition and the notion of protecting national interests in the energy sector. The European Commission, which has championed the process, notes that reforms have not been fully implemented in some parts of the EU, meaning a handful of former state energy monopolies still enjoy a crushing grip on their domestic markets.

The year 2006 was another year of high and volatile energy prices. But despite high prices, world energy consumption growth remained above average, continuing the trend of recent years. Energy use is also increasingly shifting away from OECD countries and becoming more carbon-intensive. It was a year when energy markets were once again the centre of attention, attracting the interest of politicians, consumers and policy-makers alike. “Last year showed markets at work. Primary energy consumption growth has decelerated particularly for fuels which have seen the highest increase in price,” said BP’s chief economist-designate Christof Rühl speaking today at the launch of the BP Statistical Review of World Energy 2007. “However, global carbon intensity the link between carbon emissions growth and energy growth has increased.” For the second year in a row, world energy growth slowed, rising by 2.4 per cent, down from 3.2 per cent in 2005, but still just above the 10-year average. The pattern of recent years, which has seen robust demand in Asia Pacific and China in particular, was repeated with Chinese energy consumption rising more than 8 per cent. China’s usage of all forms of energy rose in the year, taking the country’s share of total global consumption to more than 15 per cent. Continued high energy prices resulted in slower consumption growth amongst the main energy importers, particularly the US where primary energy consumption fell by 1 per cent in 2006 compared with 2005, despite economic growth. Oil, natural gas and coal usage were down while nuclear energy and hydro-electricity were up very slightly. Oil and gas reserves were largely unchanged in the year with the reserves-to-production ratio remaining above 40 years for oil and 60 years for gas. Despite a small decline in 2006, oil reserves are still some 15 per cent higher than a decade ago, at 1,208 billion barrels. Global gas reserves were slightly higher at 181 trillion cubic metres, with the US and several Opec members showing increases.

Oil: a 400,000 barrel per day (b/d) fall in OECD oil consumption, the biggest decline from that grouping for more than 20 years, underlines the impact of rising oil prices. Prices peaked at more than $78 a barrel in August as the average price of dated Brent increased by nearly one fifth to $65.14 a barrel in 2006. The OECD fall was the main factor behind the weakest global growth rate for oil since 2001, at 0.7 per cent or half the average for the past decade.

Overall global production was up some 0.4 per cent to 81.7 million b/d. Faced with weak demand, Opec cut production late in 2006 for the first time in nearly two years. For the year as a whole, Opec increased its production by an average 130,000 b/d to 34.2 million b/d.

Amongst Opec producers the main increases came from United Arab Emirates and Iraq while there were declines in Saudi Arabia, Venezuela and Nigeria. Outside of Opec output was up some 300,000 b/d in 2006, though this rise was less than half the 10-year average. The biggest growth came from Russia, up by some 220,000 b/d, and Azerbaijan, Angola and Canada. Oil production was down in the UK for the seventh year in a row, and in the US for the sixth year in a row.

Gas: consumption, strongly fuelled by demand growth in Russia and China, rose by some 2.5 per cent in 2006, close to the average of the past decade. These rises in demand offset the declines in the US and Europe. The European fall was due to a combination of higher prices and warmer-than-normal weather. Russian gas demand, almost as large as the total consumed by the whole Asia Pacific region, increased by some 7 per cent in 2006, accounting for 40 per cent of the global increase. China’s consumption grew more than 20 per cent to 55.6 billion cubic metres.

Gas production was up more strongly than it has been for many years, by some 3 per cent, led by Russia. The US also staged a recovery following the severe hurricane damage in 2005. UK production fell for the sixth year in a row.

Coal: dominated by China, coal was once again the world’s fastest growing hydrocarbon. For the eighth year in a row China’s demand grew, but at 8.7 per cent was well down on the double digit growth of recent years. China still accounted for 70 per cent of global growth in coal consumption. Even excluding China, global coal consumption is increasing. While US consumption was down for the second year in a row, consumption in the UK and elsewhere in the OECD was up for the third consecutive year.

Nuclear and Hydroelectricity: the OECD countries accounted for the lion’s share of the global increase of some 1.4 per cent in nuclear output, mainly through increased capacity utilization and capacity upgrades. Hydroelectric generation was above the decade average at 3.2 per cent, with notable capacity-related increases in China, India and Brazil. Increased rainfall in the US offset declines in Canada and Scandinavia.

Renewables: use of wind and solar continue to grow rapidly but from a low base. Installed wind power capacity was up by some 25 per cent in 2006 but still accounts for less than 1 per cent of worldwide electricity production. Solar power was also up sharply but its contribution, like wind and other renewables relying heavily on government subsidies, is still an even smaller contributor to global power. Ethanol use rose by 22%.

France, Germany, Belgium, the Netherlands and Luxembourg signed an agreement Wednesday to increasingly link their power grids making it easier to trade electricity across national borders. EU Energy Commissioner Andris Pieblags hailed the deal as the “founding stone of the largest integrated regional energy market in Europe, which will bring lower prices for consumers, increased security of supply and will attract investment in new generation capacity and transmission infrastructure.” The agreement was signed on the margins of an EU energy ministers meeting. Not much electricity is currently sold across national borders in Europe. If a utility in one nation buys power across the border, it needs to buy capacity the space on a grid to actually transport that electricity at a separate auction. Under the new agreement, electricity and capacity will be bought simultaneously. The deal adds the German and Luxembourg power grids to a deal linking those of France, Belgium and the Netherlands that was signed last February. Expansion to Scandinavia and to the grids of Spain and Portugal will be next. “Once the market is coupled with Eastern Europe through Germany, important progress will have been made in creating a European wholesale market functioning in a fairly harmonized way,” said Pieblags.

Gazprom plans to build a power station in Germany, expanding further into the electricity market with one of its first major projects outside Russia. Gazprom said Friday that it planned to supply industrial customers and to trade power on Europe’s largest power market with the 400 million euro ($541.8 million) gas-fired power plant that it seeks to build in the east German town of Eisenhuttenstadt. Gazprom plans to build the 800-megawatt power station together with Soteg, Luxembourg’s main power supplier, in which the state of Luxembourg, steelmaker Arcelor Mittal and E.ON, Germany’s largest utility, each hold about 20 percent. Both parties, which each hold half of the project, signed a memorandum of understanding in which they agreed to form a joint venture for the project, Gazprom said. They plan to produce power with the plant from 2010 and have not yet received approval to build the station, a spokesman for Gazprom in London said. The move comes as Gazprom seeks to expand outside Russia and the gas business, while the German government, as well as the European Union, seeks to get more companies to compete on the region’s power market. In Europe, Gazprom is involved in projects such as a Latvian utility and power trading in France as well as Germany, and it has a power-for-natural-gas agreement with the Deeside power station in Britain. Soteg plans to supply power to industrial customers and distributors in Luxembourg with its share of the power, it said in a separate statement.

Someday, you might be able to charge your iPod or cell phone just by taking a walk or even plugging in to your own bloodstream. Georgia Tech University researchers announced Thursday they have created a prototype “nanogenerator” that can produce electricity to power portable devices using mechanical vibrations, sonic waves, or the flow of blood or other liquids. The device, developed in part through a grant from the military’s research agency, is at least a few years away from hitting store shelves alongside all those iPod and cell phone accessories. But researchers say it definitely shows that tiny power generators could someday make batteries obsolete. “If you had a device like this in your shoes when you walked, you would be able to generate your own small current to power small electronics,” said Zhong Lin Wang, a professor in Georgia Tech’s School of Materials Science and Engineering. Wang predicted that a device based on his prototype could be on the market in five years or less. “This could have very broad impacts,” he said. For the military, such a device could power explosives or wearable biochemical sensors, Wang said. In medicine, it could be implanted into the body and used to power electronic devices that measure blood pressure. And for on-the-go consumers, it could someday power a wide array of portable devices. Wang’s nanogenerator works something like a miniature windmill or hydroelectric dam. Inside the device, tiny microscopic wires wave back and forth whenever they’re subjected to movement. When the wires move, they brush against a silicon electrode, producing tiny sparks of electricity. Wang said he thinks devices could be built containing millions or even billions of the zinc oxide nanowires. He and other researchers have plenty of work to do before any such product hits the market. In coming months, Wang said, they’ll be working on ways to increase the voltage output from the devices. In part, they hope to accomplish that by figuring out ways to produce zinc oxide wires that are more uniform in length. That said, he and others have “pushed it from scientific concept to true prototype devices,” Wang said. In addition to the military’s Defense Advanced Research Projects Agency, funding for the project comes from the National Science Foundation and the Emory-Georgia Tech Center of Cancer Nanotechnology Excellence. Details of the research are to be published in today’s edition of the academic journal Science.

It has long been acknowledged that the commercial opportunities in the so called ‘BRIC’ markets - Brazil, Russia, India and China - remain significant for energy players. However, new research highlights the fact that, while these opportunities are substantial, major challenges need to be overcome if these opportunities are to be successfully commercialized.  With rapidly growing economies and a wave of direct foreign investment, the BRIC markets are widely seen as core markets for players in just about every industry. Within this context, the energy industry is no exception. The close relationship between GDP growth and energy demand growth make the BRIC markets of particular interest to energy players throughout the value chain. Already, the BRIC markets are heavily intensive and voracious energy consumers. Despite accounting for just 9% of global GDP, the BRIC markets consume 27% of the world’s primary energy, 17% of its oil, 19% of its gas demand and around half of global coal demand. However, these statistics hide the fact that per capita energy consumption levels are extremely low. Three of the four BRIC markets have per capita primary energy demand levels well below the global average, and are a fraction of the levels seen in the UK and US.  Going forward, the rapid growth seen in energy demand in the BRIC markets is certain to continue with no signs that demand saturation is even on the horizon. Over the past decade, Brazil, India and China have all seen demand growth far outpace the world average, and are significantly ahead of the US and UK, where the mature nature of the energy economy leads to only modest year on year demand growth.  Gas has formed the mainstay of this growth. Gas is rapidly boosting its role in the BRIC market energy mix. In recent years, gas demand growth in the BRIC markets has been well above that seen in many more mature economies. Brazil and China have seen particularly strong growth, at between six and seven times the global average.  As the BRIC economies continue to grow, gas demand is unlikely to recede. As the BRIC economies move more towards services and away from heavy industry, the prospects for gas demand remain extremely bullish.

The attractions of the BRIC markets to energy players are, however, not confined to demand-side factors. In the supply side, there remain considerable commercial opportunities given the often significant resource endowments of the BRIC countries. Collectively, the BRIC markets make up 41% of global coal reserves, 9% of oil reserves and 29% of gas reserves. As such, the scope for continued upstream production investment, to both meet indigenous demand and for export, is significant. However, while market fundamentals in the BRIC markets have resulted in, and will continue to result in, significant investments from players throughout the energy value chain, there are a number of barriers to entry frustrating the process.  One of the key threats facing new entrants to the BRIC markets are the dominant, and often entrenched, positions of national energy players and incumbents.  In Brazil, for example, Petrobras dominates the oil and gas value chain, despite the fact that the market was theoretically opened in 1997. Similarly, the other BRIC markets have their dominant players, representing a formidable challenge to new entrants.  Despite this dominance, some foreign players have begun to see success in penetrating these markets. One such example is in India, where Shell, ExxonMobil and Caltex have begun to make an impact on the fuel retailing and lubricants markets - although their expansion remains frustrated by price controls and the influence of national players.

While the magnitude and consistency of demand growth in the BRIC markets will continue to represent strong attractions for energy players in at least the short to medium term, the challenges of competing with established national players should not be underestimated.