Jennifer Whitmore (Wicklow, Social Democrats) | Oireachtas source

I move:

That Dáil Éireann:

notes that: — the data centre sector in Ireland is undergoing a surge in development, with approximately 70 data centres constructed, representing a 25 per cent increase on last year, a further eight under construction and between 25-30 more in the planning stages;

— a substantial amount of public funding has been spent on construction-related investment for data centre and large energy user growth and the sector expects €6.7 billion in investment between 2020 and 2025, adding to the €6.2 billion that has been invested in the sector to date;

— data centres are energy and resource-hungry projects, requiring the same amount of energy as a large town or a small city like Kilkenny, using between 500,000 and 5 million litres of water a day;

— according to EirGrid, data centres and large energy users are expected to use 27 per cent of all electricity demand by 2028, up from its current 11 per cent share of the national grid, and energy use by data centres is expected to double over the next five years;

— electricity prices rose by almost 19 per cent in the year to the end of August as indicated by the latest Central Statistics Office Consumer Price Index;

— Ireland’s commitment to 70 per cent renewable energy by 2030 is in line with our decarbonisation goals;

— the contribution of data centres to job creation is unclear, as the Department of Enterprise, Trade and Employment currently does not collect this information and estimates that between 30-50 permanent jobs are created per centre;

— the Government is committed to developing energy efficiency standards for equipment and processes, particularly those set to grow rapidly such as data centres;

— the Government’s Statement on the Role of Data Centres in Ireland’s Enterprise Strategy (2018) is the only Government policy on the development of the sector and pre-dates global and national energy security concerns, and also notes the updated climate legislation and targets, and the recent surge in data centre development in the country;

— there are forecasts of an impending energy crisis this winter, with two separate amber alerts already issued by the Single Electricity Market Operator this month due to temporary electricity supply shortfalls, and seven such alerts have been issued in the past 15 months, compared with just 11 alerts over the previous ten years;

— the Commission for Regulation of Utilities (CRU) has warned of 'rolling blackouts' if action is not taken to deal with the power demand from data centres, recommending either a moratorium on the construction of data centres, or new conditions on construction; and

— the Industrial Development Agency has warned that the energy crisis has the potential to inflict 'considerable reputational damage' and negatively affect the country’s ability to attract foreign direct investment; acknowledges that: — in the context of a climate crisis, post-Covid economic recovery and ongoing energy security concerns, data centres must be managed sustainably through appropriate planning conditions, sustainable energy sources and all necessary economic risk impact analysis carried out on the development of data centres in Ireland;

— the Government has not carried out an environmental, economic and energy demand impact analysis on the development of data centres to date;

— there is little to no transparency as to how the Government is managing data centre growth in Ireland, and no single Government Department has taken ownership of the sector’s development or the collection of data in relation to data centres;

— Ireland is at risk of not meeting its renewable energy targets as a result of increased energy demand from data centres;

— there are concerns of higher energy prices as a result of data centres’ increasing share of energy demand, not only curbing post-Covid economic growth but leading to higher rates of fuel poverty, an outcome in direct conflict with just transition principles;

— there could be a potential negative impact on attracting foreign direct investment, which creates much larger numbers of jobs than data centres, if energy demand is not properly managed; and

— concerns have been raised that construction of data centres could take away necessary labour for the construction of much-needed homes during the current housing crisis; and calls on the Government to: — enforce higher standards as set out in the European Union Code of Conduct for Energy Efficiency in Data Centres, removing the voluntary nature of the code and putting in place obligations to prevent the industry from self-regulating during this rapid state of development of data centres;

— request that the CRU publish its findings on data centres from the recent public consultation and to outline a proposed direction on data centre connection to the electricity grid system, and publish its decision as soon as possible;

— consider the CRU proposals that EirGrid and ESB Networks would be required to prioritise connection applications from data centres in accordance with a series of factors, including whether data centres:

— generate enough energy on site themselves to support their demand for electricity;

— can be flexible in reducing their consumption at times of system constraint;

— have chosen a location relative to grid constraints;

— have the ability to provide onsite dispatchable generation and/or storage; and

— have the ability to reduce consumption when requested by the system operator; and

— enact a moratorium on the development of data centres and the issuing of planning decisions as an interim measure until an economic, environmental and energy impact risk analysis has been carried out.

The Social Democrats are calling for a moratorium on the development of data centres in Ireland. We are calling for it because the sector has experienced unprecedented growth unlike anything Ireland has seen before. Instead of being confident and intentional about the growth and management of data centres and facilitating them to be part of our energy future in a sustainable way, the Government is blindly supporting the rapid expansion of the sector without placing any demands or responsibilities on them and allowing them to grow based on the shiny promise of the branding opportunities the Government believes this technology will bring.

Currently there are 70 data centres in operation, with eight under construction and between 25 and 30 in the planning stages. This sector is growing so quickly it is projected that more than 100 centres will be in operation by 2025, hosting Amazon, Microsoft and many others. This expansion does not come without a financial cost to the taxpayer. Much public money has been spent on data centre and large energy user infrastructure, totalling approximately €7 billion to date, with a further €7 billion expected in the next five years. The Engineering Academy of Ireland projects this cost could go up to €9 billion.

Data centres are water- and energy-hungry projects, requiring the same amount of energy as a large town or small city like Kilkenny. They use between 500,000 and 5 million litres of water a day. According to EirGrid, data centres are the largest demand driver out of all the demand-connected customer groups. This contrasts starkly with demand growth in other sectors outside the data centre industry, which have remained largely flat in recent years, and it has meant the rate at which data centres are seeking to grow is unprecedented in Ireland. It is reported that EirGrid’s latest generation capacity statement, to be released today, warns that the electricity system is being stretched beyond its capacity, due mainly to the increasing number of data centres, and that to maintain energy supply to these facilities it will be necessary to delay the retirement of oil- and coal-fired electricity generation plants. This goes completely against our climate ambitions. It is also predicted we will need to rent emergency power generation at a cost of hundreds of millions of euro.

The Minister for the Environment, Climate and Communications, Deputy Ryan’s Government has been asleep at the wheel when it comes to management of data centres. In other countries, such as the Netherlands and Singapore, growth of data centres has caused so much concern that they have halted the issuance of building permits for them. A similar moratorium here would be good practice. A moratorium is needed until we are very clear about the implications of a dramatically expanding sector, until the security of our energy supply can be guaranteed and until people across Ireland can be certain they will not pay the economic and environmental costs associated with these energy-hungry projects of scale. However, the response from Government parties continues to be that data centres need to be protected at all costs, regardless of what the evidence and the experts are saying. In fact, the Tánaiste said data is like "gold" or "diamonds" and that the data centre industry is pivotal to growth strategies for economic and regional development in Ireland. However, let me be very clear that if this is done incorrectly, data centre depth development could also be our downfall. If our security of energy supply decreases, if prices rise for customers, if power outages become the norm and larger employers choose not to invest in this country, we could lose jobs as well as the race to reach our renewable energy targets by 2030, and all for the sake of the sacred data.

This is why it is very important we know what we are getting ourselves into. We must acknowledge how this will impact on the individual in Ireland. Is it about asking people to make sacrifices to reduce their own carbon footprints while data centre growth unravels all the hard work done in a blink of an eye? People are doing their best to tackle climate change in their own way. Where people can, they are buying electric vehicles and they are encouraged to do so. Others are retrofitting their homes or buying more sustainable products. As we ramp up our response to climate change our choices will get even harder and tougher, but more impactful. That said, people need to know the choices they are making are amounting to something, to some change that will benefit our atmosphere and our global fight against climate change. They need to know it is a fair and just transition to a zero-carbon economy.

We are now facing a perfect storm when it comes to our energy supply. Rocketing international prices for natural gas have seen wholesale prices jump by 250% already this year, meaning consumer bills will be up by as much as €500 this winter. Given Ireland is nowhere near meeting our target of generating 70% of our electricity from renewable energy sources by 2030, we are still highly vulnerable to these price shocks. We need to ask ourselves whether it is fair that ordinary people will pay the cost as Ireland struggles to reach its 2030 renewable energy goals because of rising energy demand from data centres? Is it fair that an imminent energy crisis is forming and people will be faced with higher energy prices and potential blackouts? Is it fair that fuel poverty is increasing and more and more people are choosing to self-disconnect to save on their own fuel costs? People are already asking why, in an energy crisis, our Government is still committed to data centres. They already know this current situation is not fair.

The Government says it has this under control but there has been little to no transparency on how the Government is managing and forecasting the development of this sector. To date, the Government has not carried out an environmental, economic and energy-demand impact analysis on the development of data centres. I have sent countless parliamentary questions to all the relevant Ministers and not one can tell me what analysis has been carried out to determine the impact these centres will have on our energy economy and our carbon footprint. It is also unclear the contribution data centres will make to job creation as even the Department of Enterprise, Trade and Employment does not collect this information. The Department estimates between 30 and 50 permanent jobs are created per centre. Thus we do not have a clear understanding as to why the Government is so insistent on the growth of this sector.

There is little to no transparency as to how this Government is managing data centre growth in Ireland and no single Department has taken ownership of the sector’s development or is collecting data about them. This is a sign of a self-regulating market and growth which is now unsustainable. Even the EU code of conduct for data centres is a voluntary measure which does not publish energy data of individual data centres. The only strategy we can work off is a 17-page 2018 document entitled Government Statement on the Role of Data Centres in Ireland's Enterprise Strategy. It is the closest thing the Government has to a policy platform.

At best, it is flimsy, short-sighted and overwhelmingly optimistic of the benefits of data centres, including job creation. A new one is required in the context of updated climate action legislation, our energy crisis and the unprecedented growth of the sector since this document was published.

Even amid the warnings from the Commissioner for the Regulation of Utilities of rolling blackouts if action is not taken to deal with the power demand from data centres, the Government does not seem too concerned. The Industrial Development Authority, IDA, has warned that the energy crisis has the potential to inflict considerable reputational damage and negatively affect the country's ability to attract foreign direct investment, but this warning does not seem to be filtering into Government circles either. The Government made a commitment in the programme for Government to develop energy efficiency standards for equipment and processes, especially those set to grow rapidly, such as data centres, but we are still waiting for this. These are essential if we are sustainably to develop the data centre sector.

It is important the Government has time to develop policy to make sure data centres are as efficient as possible and can in fact contribute to our renewable energy targets by generating their own electricity, creating district heating and other innovative green energy solutions. Tomorrow, we have statements on the upcoming climate action plan. Ideally, we should be in a place knowing full well the role data centres will play in our energy demand and meeting our climate action targets, but we do not and so we will continue to fly blind on this course.

In the context of a climate crisis, post-Covid economy recovery and ongoing energy security concerns, data centres must be managed sustainably through appropriate planning conditions, sustainable energy sources and all necessary economic risk impact analysis being carried out on the development of them in Ireland. The Government has failed to do that to date. The Social Democrats are not opposed to data centres, but we want a pause in their development until the Government can tell us some pretty basic information. What are the implications of their continued growth? How can our energy infrastructure cope with the increased demand necessitated by data centres, and how can we reach our climate action targets, given the huge surge in energy demand?

For that reason, it is imperative a moratorium is put in place, as an interim measure, until an impact analysis has taken place, a proper whole-of-government strategy is established, and any energy and environmental concerns are addressed.

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