Big tech lobbying Coalition against curbing data centres

Big tech companies with large Irish operations have come together to pressure the Government on moves to curtail new data centres, amid concern about constraints on the electricity network.

A group called Cloud Infrastructure Ireland has formed under Ibec, the business lobby, to argue against a moratorium on data centre connections and proposals from the utilities regulator to prioritise national grid access. The group includes Amazon and Google, heavy power users with a big presence in Ireland.

“A moratorium on processing data centre applications in Dublin is the least desirable of the current options under consideration,” Cloud Infrastructure said in a submission to the Commission for Regulation of Utilities.

Its intervention comes one month after the regulator warned of “consumers facing rolling blackouts” if the current system for connecting data centres to the grid were not changed.

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With two big power stations closed for repairs that will take months to complete, anxiety about the risk to power supplies when demand peaks in winter has already prompted Government moves to provide emergency power generation in Dublin from the autumn.

The regulator has said data centres are the biggest driver of all demand for electricity, adding that they were seeking to grow their power load at a rate unprecedented in Ireland. The annual increase in demand in the last four years was equivalent to adding 140,000 households to the power system each year.

Doing nothing was not an option because it would lead to demand outstripping supply, the regulator argued, but added that a moratorium was not appropriate “at this time” because alternative mechanisms were available. Amsterdam has stopped issuing permits for data centres in certain parts of the city because of grid concerns and Singapore imposed a moratorium on new centres in 2019.

Flexibility

Instead of a moratorium, the regulator wants connections to the grid prioritised according to the ability of each data centre to bring on generation and/or storage equal or greater to their demand. It also wants connection to be based on the centre’s ability to provide flexibility in demand by cutting consumption when asked.

Although big tech companies agreed that action was needed to resolve transmission constraints and security of supply challenges, they have come out against the regulator’s grid prioritisation measures.

“The consultation proposes that data centres should invest in dispatchable generation (eg, natural gas) to receive new grid connections,” Cloud Infrastucture said in its submission.

“[Our] members are willing to invest in new generation, but we strongly prefer targeting those investments to renewable energy and allowing the auction and market mechanisms to procure necessary balancing, firming and peaking resources from the market.”

The group argued that a related proposal to determine grid access based on location “within a constrained region or unconstrained region” should be ranked as a low-priority criterion.

“This would severely restrict investments in expanding existing Dublin-based data centres, at a time when demand for digital services is growing,” it said.

“These data centres should still have the option to grow their existing sites in response to demand from their customers.

“Closing the door to existing sites by deprioritising constrained regions would be unfair to existing operators and could limit Dublin’s ability to respond to growing demand for cloud services. It is also unclear to [Cloud Infrastructure] what areas are considered constrained and where available capacity may exist.”