Dr. Patrick Bresnihan:

I thank the committee for inviting me. I am here to talk about data centres. There are 70 data centres operating in Ireland, which is an increase of 25% compared with 2020. Most of these are concentrated around Dublin, which has become the largest data centre hub in Europe and which accounted for 25% of the overall European industry market share at the end of 2018, with the nearest competitor, London, recording a market share of 24%. The 70 operational data centres have connection agreements for more than 1,800 MW, with up to 2,000 MW of additional requests received by EirGrid. Approximately 1,000 MW of this has been received within the past year. Over the past four years, there has been an annual increase in demand usage of around 600 GW from data centres alone, which is equivalent to the addition of 140,000 households to the power system each year. An average data centre with a load of 60 MW would be comparable with the usage of a large town or small city such as Kilkenny.

Data centres currently account for 11% of grid capacity, but EirGrid estimates that this will be 28% by 2030 on the basis of existing connections. If all proposed data centre projects were connected, this figure could be as high as 70% of grid capacity by 2030. This is compared with 2% of electricity consumed by data centres worldwide.

Data centres are currently responsible for 1.58% of Ireland’s carbon emissions. Data centres are reliant on the national electricity grid, which remains largely powered by fossil fuels. The major component of this is gas, which represented more than half of electricity generation last year. As well as this, data centres require their own installed power generation or energy storage capacity as back-up. This back-up generation tends to be gas-fired. Natural gas is a fossil fuel and contributes to Ireland’s emissions. Over 2020, data centres saw a 27% increase in gas demand.

Ireland is committed to achieving 70% renewable electricity by 2030. Even at this early stage, however, that looks overly ambitious. As the main source of this renewable energy, which is onshore and offshore wind, is intermittent, there will likely be a need to have other sources of energy generation available. In the short to medium term, that is likely to be natural gas. Achieving ambitious emissions and renewables targets by 2030 will undoubtedly be far more difficult with the addition of more data centres to the grid.

Data centres also require large quantities of water. The average data centre uses a lower estimate of 500,000 litres per day. This figure has the potential to rise to 5 million l per day, although this is rare - for example, during the recent heatwave in the summer of 2021. This is particularly significant in light of the weak security of water supplies in parts of the country, particularly the greater Dublin region.

At the same time, Ireland faces more immediate challenges relating to security of energy supply. Two amber alerts have been issued this month alone and we have yet to enter the winter season. As energy supplies, particularly those relating to natural gas, are limited or in high demand, prices have increased. Recent estimates suggest an increase in the average household electricity and gas bill of €400 this winter. While the drivers of these current energy shortages and price increases may be contingent on quite specific conditions, there is no doubt the energy demands of data centres exacerbate the problem and will continue to do so if they are allowed to develop further.

In this context, serious concerns about the energy demands of data centres have been raised by EirGrid and the Commission for Regulation of Utilities, CRU. One proposal by the CRU is for a moratorium on the development of any new data centres in Ireland. There are also two Bills going forward to the Dáil in the coming weeks calling for such a moratorium, one from Deputy Bríd Smith of People Before Profit and one from Deputy Jennifer Whitmore of the Social Democrats. Ireland would not be the first country to do this. Singapore introduced a moratorium on data centres two years ago. Similarly placed as a tech and digital hub, with ambitious climate and renewable energy targets, the Singapore Government took the decision in 2019. The Singapore Government states that the moratorium will be lifted when renewable energy capacity and-or data storage technologies develop enough to reduce emissions and the energy burden they represent. In 2014, according to the most recent figures available, data centres represented 7% of Singapore’s grid capacity compared with the projected 28% by 2030 in Ireland.

From these figures, it is evident that Ireland shoulders more than a fair share of the energy and water burden of global digital activities. What is less evident is what this concentration of data centres contributes in terms of long-term employment or regional economic development. At this stage, the prospects of energy insecurity, and even brownouts or blackouts, may carry greater reputational and economic damage than a moratorium on data centre development. Further down the line, there is also the reputational damage and potential financial penalties if Ireland fails to meet its 2030 climate and renewable energy targets.

There is an important wider context to this debate which also needs to be considered. Ireland is committed to a just transition under the Paris Agreement on climate. This means that the Irish State must ensure the fair distribution of costs and benefits associated with large-scale decarbonisation efforts. In a context where households are facing increasing energy bills and carbon taxes, the continued granting of planning permission to energy-intensive data centres is already being perceived as an unfair distribution of costs and benefits. Objections to onshore wind farms, for example, have been articulated in terms of the perceived benefit of these projects to energy companies and large-end users, that is, tech companies, rather than to the public or action on climate. As more attention focuses on data centres and their energy and water usage, it may be harder to gain the support of the Irish population for decarbonisation efforts. There is a danger that the public will perceive climate action as serving the interests of a few, with the burden carried by the majority.