EirGrid halts talks with potential data centres over electricity curbs

EirGrid, the operator of the national electricity network, has stopped talks with dozens of data centre promoters because of curbs on the sector to ease pressure on power supplies.

The halt to discussions on grid connections comes months after IDA Ireland, the inward investment agency, warned that questions over the supply of electricity were “unhelpful” to efforts to market the State as a global business hub.

Surging data centre demand prompted the Commission for the Regulation of Utilities (CRU) last November to restrict access to the grid while new power stations are built, a years-long process. The measures followed warnings of rolling blackouts if the sector’s growth was not curtailed.

Now EirGrid, the State-owned grid manager, has said the curbs have led it to halt talks with most companies that were seeking access to the grid.

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IDA criticism

“EirGrid were considering applications for a grid connection offer from just under 30 data centre projects at the time of the publication,” the company said, referring to the regulator’s new rules.

“EirGrid are now applying these criteria to all data centre applications. In doing so, the majority of the applications referenced above have been, or are in the process of being, closed out in line with the CRU direction.”

IDA Ireland had pushed back against such curbs, arguing that data centres were integral to the technology sector, which employs about 140,000 people here.

The presence in Ireland of groups such as Amazon, Google, Apple, Facebook and Microsoft has spurred the growth of the centres, buildings that house energy-intensive computer systems for storing internet and business data.

Carbon emissions

With some 70 data centres already in the State, the sector has emerged as a huge driver of electricity demand at a time of constraints on its supply.

Increased data centre demand in the four years to 2021 was the same as adding 140,000 households to the grid each year, prompting anxiety about carbon emissions on top of worries about the continuity of supply.

The regulator’s ruling compelled EirGrid to consider whether new centres could provide their own electricity, supply it to the grid and cut consumption if required. When deciding on connections, the grid operator must also consider whether the proposed centre is in a “constrained or unconstrained” region of the electricity system.

Responding to questions, EirGrid said it was engaging with applicants as they seek to comply with the new rules. “Should these, or indeed any, applicants be in a position to meet the required criteria, we will be able to progress their application in line with policy.”