Data centres Q&A: How big a drain are they on Ireland’s energy grid?

It is hard to reconcile that “a bunch of computers” in one location that process, store and distribute vast volumes of information at huge speed could threaten the security of Ireland’s power system. Then again, we have unique circumstances: a roaring economy combined with rising carbon emissions.

How did we get to this point?

Data centres have been increasingly eating up our electricity, accounting for 18 per cent of total consumption across the economy in 2022 – at a time when households were reducing energy use.

Deeper analysis reveals the factors at play. Ireland has become a destination for data centre development and a global leader in digital innovation backed by a strong skills pool. Some 30 per cent of jobs are connected to IT or electronics.

A benign tax regime for multinationals, including data companies, helps. We also have a cool climate for data centres to do their stuff.

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It should be acknowledged that growing personal consumption and sharing of data (text, images and video clips) via smartphone internationally is increasing demand.

[ Cantillon: Data centre power statistics show Apple’s Athenry rejection changed little ]

How prevalent are data centres?

More than 75 data centres operate here, with eight under construction and 30 in planning. Most are in the Greater Dublin Area. A typical large data centre near the M50 is probably consuming as much electricity as Kilkenny city.

Resulting power needs are placing an unbearable strain on the grid – so much so there is a strong case to press the pause button, according to UCC clean energy analyst Dr Paul Deane. It has prompted the State-owned power provider EirGrid to impose a de facto moratorium in Dublin up to 2028.

The Commission for Regulation of Utilities (CRU) decided new applications to EirGrid should be assessed based on conditions including proposed location; ability to have their own on-site electricity supply equal or greater to their demand; and ability to be flexible in demand by reducing consumption from the grid in times of constraint.

How can we reconcile our data centre power requirements with climate obligations?

The short answer is it is impossible in current circumstances.

Deane acknowledges the benefits data centres provide to the economy but, equally, the Government has difficult decisions to make as economic growth and reducing emissions rarely go hand in hand. “We need to decide, do we want to reduce our pollution from greenhouse gases? Or do you want to grow our economy? Because the two are very difficult to reconcile at the moment.”

Complicating matters is the country’s 80 per cent renewable electricity target to be achieved by 2030. With Irish data centres already using a fifth of the country’s electricity, any growth in the sector would render Ireland’s climate goals virtually impossible to achieve.

Minister for Climate and Energy Eamon Ryan is against a moratorium but stresses no sector can have “an out” on climate obligations. “It’s the same for all those large users of the data centres. So we can deliver the clean electricity that will give them a sustainable future here but we can’t break the carbon budget in the meantime. So they have fit within it, rather than blowing it.”

[ Data centres consume as much electricity as urban houses, CSO figures show ]

He insists data centres can and need to be part of the solution.

Many data centres here rank among those with the most ambitious decarbonisation targets, as do their big customers – Google plans to be carbon neutral by 2030. Some are building or acquiring wind farms to accelerate efforts or planning to use waste heat in district heating schemes to benefit local housing or State facilities such as hospitals.

Deane says the pause should be in place until more conventional power generation is in place which will make the grid stronger, and more renewables are available which will make it cleaner. This would give a line of sight out of the current crisis.