Government will not ban new data centre developments in Ireland

28 Jul 2022

Image: © Shuo/

In a statement on the role of data centres in Ireland’s economy, the Government highlighted principles to guide any new developments.

The Government has confirmed that new data centre developments will not be banned in Ireland, amid concerns around their environmental impact and the pressure they place on the electricity grid.

According to Central Statistics Office figures, data centres consumed 14pc of Ireland’s electricity last year, which is more than rural dwellings.

In a revised statement on the role of data centres in Ireland’s enterprise strategy, the Government argued that data is an “essential enabler” of our increasingly digital economy and society.

Instead of a ban on data centres, it has proposed a set of tighter regulations for new developments as the country works to halve its emissions by the end of the decade.

“We must align the twin transitions which are both digital and green,” the statement read.

Guiding principles for new developments

The revised statement requires new data centre developments in Ireland to meet a broad set of criteria or principles that aim to balance economic benefits with sustainability and meeting emissions targets.

This includes preferring data centres “associated with strong economic activity and employment” that make “efficient use of our electricity grid, using available capacity and alleviating constraints”.

New data centre developments also need to demonstrate the “additionality of their renewable energy use in Ireland” and be located in areas where there is potential to “co-locate a renewable generation facility or advanced storage with the data centre”.

The Government also noted a preference for data centres that can demonstrate “a clear pathway to decarbonise and ultimately provide net-zero data services”, while also “creating opportunities for community engagement and assisting SMEs” at all phases of the data centre lifecycle.

Can data centres be the solution?

Cloud Infrastructure Ireland (CII), the industry body focusing on policy issues that affect cloud providers, welcomed the statement. It said it looks forward to working with the Department of Enterprise, Trade and Employment, EirGrid and the Commission for Regulation of Utilities on the issue.

A CII-commissioned report by Baringa and Bitpower published last week suggested that data centres attract more than €1bn of direct investments into Ireland annually. They are also a key part of Ireland’s computer services industry, which generated €134bn of exports in 2020 – representing a third of all Irish exports.

The report said that data centres can help accelerate Ireland’s green energy transition by directly supporting new renewables projects through financing, grid support and providing zero-carbon heat to neighbouring buildings.

There are many innovations happening in the Irish data centre sector. Microsoft is looking to see if backup batteries from its data centre in Dublin could be used to support the growth of renewables on the grid, while Dublin energy agency Codema and data centre provider Equinix are exploring the reuse of waste data centre heat.

But digital expert Gerry McGovern told last year that while companies are becoming more conscious about sustainability, their actions can often “border on smugness”.

“It’s like the industry is saying: ‘We may be encouraging a culture of waste and disposability but we’re doing it with renewable energy and look at how much more energy efficient our data centres have become at storing all this crap data we’re producing.’”

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Vish Gain is a journalist with Silicon Republic