Pa Daly (Kerry, Sinn Fein)
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84. To ask the Minister for Environment, Community and Local Government the measures he is taking to address the concerns raised by senior Government officials regarding the impact of data centres on household bills and housing development; and if he will make a statement on the matter. [49203/25]

Pa Daly (Kerry, Sinn Fein)
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Officials warned that the Government’s approach to data centres is posing a threat to housing targets and driving up our energy costs. Does the Government plan to continue to bury its head in the sand or is it going to tackle this head on? I am not sure which Minister of State is going to take this question, but if it is the Minister of State, Deputy Dooley, I was listening to him on Radio Kerry last week when he was talking about marine planning. He criticised the Government, saying it needed to move away from navel-gazing and that it had sat on its laurels. Is the Government sitting on its laurels on this issue also, or is it actually going to do something about it?

Alan Dillon (Mayo, Fine Gael)
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The programme for Government sets out a clear policy direction that balances energy, housing, climate and economic development. It recognises that increased and unprecedented investment in our electricity grid and generation capacity is essential to meet future demand, not just for data centres but for housing, electric vehicles, heat pumps and a growing population. The electricity and gas retail market in Ireland operates under a European regulatory regime. Prices are set by suppliers as entirely commercial and operational matters. However, the CRU has statutory responsibility for consumer protection. It is currently reviewing investment proposals under price review 6, PR6. Under PR6, the CRU has proposed a record €18 billion investment in the grid between 2026 and 2030, with €14.1 billion guaranteed. The Government is underpinning this with €3.5 billion in equity support for EirGrid and ESB Networks. This represents a step change in infrastructure delivery, ensuring our grid can support both economic growth and housing delivery.

While already contracted data centres will be accommodated in the near term, the Government has committed to developing a plan-led approach for future large energy users. This will align with our decarbonisation objectives, supporting Ireland’s knowledge-led economy and providing certainty for the sector.

Let me be clear, data centres are a core enabler of our technology-rich innovation economy. Ireland has successfully attracted global leaders in this space. This must be balanced with the needs of communities, housing developments and energy affordability. That is why system operators assess future demands, including housing targets, population growth and climate goals, and the Government is scaling up investment in critical infrastructure to ensure that all customers benefit and that Ireland’s energy system remains secure, affordable and fit for purpose.

Pa Daly (Kerry, Sinn Fein)
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The large energy users the Minister of State is talking about are relatively getting off the hook and they are pushing up household bills. In a confidential memo recently released to us under a freedom of information, FOI, request, the Secretary General of the Department of public expenditure warned that soaring electricity demand, largely attributable to data centres, is forcing the State to spend heavily on new power generation and grid upgrades. As the grid is paid for through network charges, this is inevitably leading to surging household bills.

A single data centre can use as much as electricity as the whole city of Kilkenny. The memo also pointed out that data centres were a risk to energy security, to the extent that there is need to “direct Government intervention in the electricity market to purchase generation capacity on an emergency, non-market basis”. All of this is going to have to be paid by the taxpayer through electricity bills, leading to a disproportionate and unfair burden on households. Not only is this unstainable, it is also regressive. Price review 6, as the Minister of State mentioned, represents the perfect opportunity to right this wrong, but the draft decision, unfortunately, seems to extend it further. Will the Minister of State commit to doing something about it to alleviate the burden?

Alan Dillon (Mayo, Fine Gael)
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Let us be clear: households are not subsidising data centres. All users of our electricity grid contribute to its development. The CRU, as the independent regulator, ensures costs are fairly and proportionally allocated. In fact, extra large energy users, including data centres, have seen network costs increase in recent years compared with those for domestic customers. Price review 6 is a great opportunity. Transmission costs for data centres are expected to stabilise and reduce, reflecting the reversal of recent increases linked to security of supply. It is important to have that balance, as I said earlier. Housing is the Government’s number one priority. That is reflected in the national development plan where we have allocated more than €35 billion over the next decade to housing, while also understanding the need for other key infrastructure, such as energy and water infrastructure. That is why the national development plan has been published and is very much focused around programme for Government commitments.

Pa Daly (Kerry, Sinn Fein)
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Why then is the Secretary General of the Department saying what is being said and that housing is being threatened by the larger users of electricity? The current proposal in price review 6 is to increase network charges for households. Presumably, the Minister of State does not disagree with that. At the same time, the proposal is to decrease charges relatively for data centres. This is unjustifiable. The excuse used by a lot of the energy providers, such as Energia, is that their network charges are rising.

Small businesses are complaining that it is the same. Data centres are the ones driving up energy demand and gobbling up all the new capacity on the grid, but they have consistently not been paying their fair share. I agree with the Minister of State that there is a need for data centres but let them pay their fair share. Their bills have been subsidised for years by small and medium enterprises and households as part of the large energy user subvention. We in Sinn Féin believe that the determination of price review 6 in December must reflect these facts and right these historical wrongs.

Alan Dillon (Mayo, Fine Gael)
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I thank the Deputy. First, the Secretary General of our Department rightly pointed out that policy choices must be made, and we are making them. Certainly, that is why we are investing in housing, the grid and water infrastructure. These are the three pillars that will support sustainable development in this country. The idea that data centres are being prioritised over homes is not supported by facts. That will not happen under price review 6. We are investing in the grid like never before, not just to connect more homes but to ensure we can distribute the renewable energy we are generating across the country and provide homes, businesses and communities with more green renewable energy. The CRU is independent. This review includes a medium-term outlook in terms of balancing housing and climate targets. It is about how we can ensure houses are delivered and our economic development is not staggered.