Nearly a quarter Ireland’s electricity demand is now being supplied through wind energy, according to a report from Vayu, the Irish gas and electricity supplier backed by global mining giant Glencore.

The company’s latest report on the wholesale energy market here indicates just over 23 per cent of the State’s total electricity demand in 2015 came from wind.

Wind generation reached a peak of 2,514 megawatts (MW) on January 7th when it accounted for over 48 per cent of demand at the time.

Ireland’s 2020 renewable energy targets commit the State to sourcing 40 per cent of its electricity from renewable sources, such as wind.

Vayu’s energy analyst Gillian Lawler said: “Wind energy is playing an ever more important role in meeting Ireland’s electricity demand, helping to drive down prices and reduce the country’s dependence on more expensive sources of energy.”

Vayu’s report indicates the average wholesale price of electricity in the Irish market was 9.4 per cent lower in 2015.

The decline was attributed to strong wind generation and lower prices for gas, which is the main energy source used to generate electricity in Ireland.

The company said an increase in peak demand is likely to be a factor in determining prices in 2016 with the economy forecast to grow by over 4 per cent next year.

However, improving efficiencies in energy generation and usage mean that proportionately less energy is required as the economy grows, it said, while noting higher demand would be somewhat offset by higher integration of renewables on the grid.

Vayu’s report showed the cost of buying natural gas on the wholesale market dropped significantly toward the end of the year, with Irish wholesale prices down 23.2 per cent in the fourth quarter on the same period last year.

The report said “surging gas supplies and suppressed demand” kept prices on a downward trend in 2015 despite temporary upward shifts linked to tensions in Ukraine and concerns over North Sea supply. This has had a marked impact on energy costs for Irish businesses purchasing gas on the wholesale market, Vayu noted.

For 2015 as a whole, wholesale gas prices here are down 4.7 per cent on 2014 and down 18 per cent compared with the average price recorded over the last three years.

Ms Lawler said exceptionally mild temperatures across Europe meant that gas demand for this time of year had fallen to lows not seen in 10 years, despite gas having overtaken coal as the fuel of choice for the power generation sector.

This was being compounded by increased gas supplies including an abundance of shipments of LNG (liquefied natural gas), she said, which accounted for approximately 15 per cent of the gas supply mix in 2015.

Vayu’s report also noted that the Corrib gas field off the coast of Mayo was expected to commence supplying the Irish network early next year. Currently the State imports 93 per cent of its gas requirements from the UK. However, during days of low demand, such as the summer months, Corrib is projected to meet the full gas demand of the country.

The gas field is expected to meet approximately 56 per cent of forecasted annual demand in its first year of production, Vayu said.