Joe O'Brien (Dublin Fingal, Green Party) | Oireachtas source

I thank the Senator for raising this important matter and apologise on behalf of the Minister for the Environment, Climate and Communications, Deputy Eamon Ryan, who is attending an EU Council meeting today.

The Government's statement on the role of data centres in Ireland's enterprise strategy acknowledges the role of data centres as part of the digital and communications infrastructure for many sectors of our economy. The statement also noted that data centres pose considerable challenges to the future planning and operation of Ireland's power system. Such challenges arise in terms of renewable energy policy, generation adequacy, security of electricity supply and electricity customer costs.

The programme for Government commits to developing efficiency standards for equipment and processes, particularly those set to grow rapidly, such as data centres. The information and communications technology sector must undergo its own green transformation. Earlier this year the European Commission adopted Shaping Europe's Digital Future, which includes an objective to foster an open, democratic and sustainable society. Key actions include initiatives to achieve climate-neutral, highly energy-efficient and sustainable data centres by no later than 2030.

Data centres have, until recent years, accounted for less than 2% of Ireland's total electricity demand. EirGrid, in its generation capacity statement for 2019 to 2028, projects that demand from data centres could account for 29% of all demand by 2028. EirGrid, in its capacity as the transmission system operator, continually models and forecasts the predicted future growth of electricity demand in its published analysis, including the Tomorrow's Energy Scenarios.

EirGrid, the transmission system operator, published an updated data centre connection offer process and policy over the summer in line with the Government policy statement and the climate action plan. While data centres can consume very large amounts of energy, they have a flat and predictable demand profile, meaning they use the same amount of electricity day and night, therefore requiring a range of generation technologies to meet demand.

Significant increases in volumes of generation capacity, including from renewable energy resources, will be required to meet Ireland's electrification objectives and demand from heat pumps, electric vehicles and data centres. The climate action plan set an ambition of 70% renewable electricity by 2030, the majority of which will be met through the renewable electricity support scheme, RESS. The first auction under the RESS has taken place and this will see major upscaling in renewable energy projects connecting to the grid from 2021, with solar energy and community-owned projects supplying electricity in Ireland for the first time.

The climate action plan also provides that IDA Ireland will use its new strategy to fully integrate decarbonisation objectives across its portfolio of clients. This strategy will seek to ensure new large-scale enterprise investments in Ireland, including factors such as location and power purchase agreement opportunities, with alignment to the build-out of the grid to maximise renewable sources.

We have recently seen a number of unsubsidised corporate power purchase agreements, CPPAs, purchased by data centre operators. It is hoped we can encourage more in order to meet the target of 15% of electricity demand to be met by renewable sources contracted under corporate power purchase agreements by 2030. When data centre operators purchase electricity directly from renewable generators, it contributes to the State's objective to decarbonise our electricity system without any subsidy from electricity customers. Work is ongoing in the Sustainable Energy Authority of Ireland, SEAI, and following from a study by consultants Baringa Partners on policy options for meeting Ireland's targets of 15% of demand to be met by renewable energy sources under CPPAs. The SEAI will launch a public consultation in the coming weeks.