Dáil Éireann Debate, Thursday - 28 September 2023
80. Deputy Catherine Connolly asked the Minister for the Environment, Climate and Communications what engagement he or his Department have had with a company (details supplied) with regard to plans for the building of three new data centres in Dublin; if he or his Department has raised energy security concerns in this regard; and if he will make a statement on the matter. [41745/23]
View answerI have a very specific question. What engagement, if any, has the Minister of State's Department had with the company which intends to build three more data centres in Dublin? Equally importantly, what issues, if any, have been raised by his Department on energy security concerns given the plans for the three data centres, and the cumulative effect of these centres and all of the other centres?
Under the Climate Action Plan 2023, the Government has committed to a new demand-side strategy for electricity and gas being put in place. The Commission for Regulation of Utilities, CRU, commenced work in this area by publishing a call for evidence and consultation paper in June 2023. The closing date has now passed. The CRU is currently analysing all responses received. In addition to formal consultation, officials in my Department regularly engage with relevant stakeholders, particularly in the context of the energy demand strategy currently being conducted by the CRU. I have been informed by the CRU that it expects that the demand-side strategy will be delivered by the first quarter of 2024, with the aim of 20% to 30% of electricity demand to be flexible by 2030, thereby facilitating active participation by citizens and businesses in the energy market.
Large energy users, LEUs, will be expected to make up a higher proportional contribution to the target as they are making up a high proportion of the increase in electricity demand. A review of the gas and electricity connection policies for new LEUs is being carried out to ensure any new connections are not causing energy security challenges and are in line with our sectoral emission ceilings. Demand-side flexibility will be crucial to fully utilise the ambitious renewable generation that is being developed. LEUs are important stakeholders in our decarbonisation and renewable energy ambitions. My officials regularly engage with them as part of a wider collaboration between industry, system operators, regulators and the Government. It is only by working together that we can achieve our climate goals and optimise the use of renewable generation here in Ireland.
It is important to note that connections to the electricity grid are dealt with by EirGrid on a case-by-case basis, in line with the assessment criteria set out by the CRU in November 2021 and available capacity. I am informed by EirGrid that the particular data centres mentioned in the question are part of the ramp-up of an existing EirGrid connection agreement that predates the November 2021 data centre connection policy decision by the CRU. The addition of this new demand is therefore expected and has already been taken into consideration in the expected growth figures in the generation capacity statement.
I thank the Minister of State. There is no official record of the number of data centres in Ireland. We are reliant on consulting companies, such as Bitpower, which reported in June 2023 that there are 82 data centres operating in Ireland - this is an increase of seven in one year - and that 77 of them are in the Dublin region. Bitpower estimates that 14 centres are under construction with planning approval for 40 more centres as part of 22 projects. Imagine that we are relying on Bitpower to tell us this. The Government strategy that was there when I come into the Dáil was a thumbs-up for the data centres. When that was reviewed, it was two thumbs-up for the data centres, without an analysis. EirGrid said in 2022 that it would not provide any more new grid connections to data centres in the Dublin area. I believe the Minister of State is confirming now that the three centres being proposed by the company predate that decision. Some 30% of our electricity will go to data centres by 2030.
We had a data centre policy in 2018 which did not refer to security of supply, to the climate challenge or to emissions. The new data centre policy, as issued in 2022, does refer to such matters. It is important that any new data centres that are built are contributing to security of supply and helping us to meet our climate targets. That is not impossible to do. In order to build a data centre, one needs planning permission and a grid connection, so one has two hurdles to meet. Getting planning permission for a data centre does not mean one can build it. There are conditions attached to planning permissions. Sometimes those conditions are based on the data centre policy, as issued in 2022, which requires, for example, that all new data centres are provided and are matched with additional renewable energy generation capacity which was not going to be available on the grid before that data centre project was proposed. These data centres have to provide their own 100% renewable energy and have to provide backup in the event of a security of supply problem. That backup can be drawn on in times of need. In that way, our new data centre policy allows for improved security of supply while also providing financial security to the 200,000 people in Ireland in sectors which depend directly upon data centres.
I realise we need data centres, but do we need the number that we are allowing to take place? Where is that reflected in Government policy? The thumbs-up approach in 2018 was disgraceful. The slight changes made since then are welcome. We are going to have 30% of our electricity going to data centres. There is a 65-acre site owned by the company in question, Amazon. Ireland uses some 30% of its energy in these centres compared to 3% of such use in Europe . Where is the policy on what is sustainable and on how much of the electricity will be diverted from households? In 2022, data centres used as much electricity as urban households. I do not know what quantity that is but that is the case according to a Central Statistics Office document. At what stage will we have a proper analysis of what is sustainable with regard to our commitments for emissions and for a sustainable future?
I thank the Deputy for her comments. I am glad to hear she acknowledges that we need data centres. I heard the same from Sinn Féin when Senator Boylan said that we absolutely need data centres. There is an understanding that we are not just going to shut down all of the data centres or prevent them from being here.
The Deputy's question is on the quantity of data centres which we can have or which is appropriate for the size of our country. Clearly, we are specialising in this country in the pharmaceutical and tech sectors. They are providing more than €20 billion a year in corporate taxes which fund our health programme, our education programme and so on. That is just in corporate taxes alone. Huge quantities of money are also coming from that sector in the form of income taxes and VAT.
The question is to what extent we can build data centres while at the same time maintaining our security of supply and meeting our climate targets. The new data centre policy said that one cannot build a data centre without building a sufficient additional quantity of renewable energy, so that it is powered 100% by renewable energy which would not have been on the grid otherwise. One must have a grid connection. The CRU and EirGrid are responsible for ensuring that grid connection does not interrupt our security of supply.
Back-up power must also be provided. I am glad to see that back-up power in many data centres is being provided with biofuel. Even on the rare occasions when the back-up power is needed it does not produce additional emissions. Our new data centre policy is very appropriate and it is working. It contributes towards security of supply and helps us to meet our climate targets.
