The Irish Times view on data centres: strain the system cannot take

Restrictions on new data centres are a far less damaging constraint on business than the lights going out repeatedly because the system is overburdened

There is more than a touch of the inevitable in EirGrid’s move to halt talks with dozens of data-centre promoters on new connections to the electricity grid.

These energy-hungry facilities for storing online data have been expanding at a rate so fast that further growth threatens stability in the entire power network, a nightmare prospect of rolling blackouts and consequent harm to people and business. In the face of that unacceptable risk, the Commission for Regulation of Utilities imposed swingeing restrictions in November that require any new centres seeking access to the grid to provide their own power, supply it into the national network and cut consumption if required in an emergency. Few can reach that bar. So EirGrid has closed or will soon end talks with most of the groups whose applications for a grid connection were in train when the regulator called halt. Almost 30 projects were under discussion at that time, potentially taking the number of data centres operating in the State close to 100.

That is strain the system could not take, all the more so given the climate imperative to end carbon-heavy power generation and expedite the transition to renewables. The need to meet demand from data centres already in the system – alongside the requirements of a growing economy – prompted moves last autumn to prolong using coal and oil until more gas power stations come on stream. Such generation is required to be held in reserve whenever wind power is not available. But with no end in sight to Vladimir Putin's war in Ukraine, European gas supplies could yet be compromised in further sanctions.

The transformation of Ireland's energy dynamics by data centre growth is extraordinary. CSO data show that electricity consumption by the centres rose 32 per cent between 2020 and 2021 and by 265 per cent between 2015 and 2021. Their annual consumption last year –14 per cent of total demand – was greater than all rural dwellings. IDA Ireland had opposed the regulator's curbs on new data centres, saying they were an integral part of the international technology sector that employs about 140,000 people. That argument fell by the way when confronted with threat of system-wide power cuts because there isn't enough electricity.

True, the investment agency warned that questions over electricity were “unhelpful” to efforts to market the State as a global tech hub. But it is equally clear that restrictions on new data centres are a far less damaging constraint on business than the lights going out repeatedly because the system is overburdened. Measured against the relatively limited economic return from data centres, the argument for continued unrestricted growth does not bear scrutiny. Still, the need for action to avert blackout risk raises questions about the lack of planning to meet growth in electricity demand that has been apparent for years.