I propose to take Questions Nos. 159 and 160 together.
Government policy in relation to data centres is primarily a matter for the Tánaiste and Minister for Business, Enterprise and Innovation. The Government Statement on the role of data centres in Ireland's Enterprise Strategy, 2018 recognises that a plan-led approach is needed to develop a range of measures to promote regional options for data centre investment, minimising the need for additional grid infrastructure.
While data centres have until recent time accounted for less than 2% of Ireland’s total electricity demand, EirGrid, in their Generation Capacity Statement 2019-2028, project that demand from data centres could account for 29% of all demand by 2028. EirGrid, in its capacity as the transmission system operator, continually model and forecast the predicted future growth of electricity demand in their published analysis such as Tomorrow's Energy Scenarios, which is available on their website at www.eirgrid.com.
The Climate Action Plan states that the IDA will use its new strategy for 2020 to 2024 to fully integrate decarbonisation objectives across its portfolio of clients and other relevant stakeholders. Building on the 2018 Government Policy Statement, the new IDA Strategy will seek to ensure new large-scale enterprise investments in Ireland, including consideration of factors such as location, energy storage opportunities and power purchase agreement opportunities are made consistent with this policy and aligned with the build-out of the grid to maximise renewable sources
Eirgrid recently published an updated Data Centre Connection Offer Process and Policy, in line with the Government Policy Statement and the Climate Action Plan. This can be found on their website, along with a consultation on the matter which is open until 28 August 2020. It is also currently undertaking a “Vision 2030” study across the three dimensions of electricity networks, power system operation, and electricity markets with the aim of developing an integrated all-island vision of the 2030 power system and electricity market. The three potential pathways set out in Tomorrow’s Energy Scenarios 2019 underpin all of the analysis being undertaken.
While data centres consume very large amounts of energy they have a flat, predictable demand profile meaning that they use the same amount of electricity day and night and therefore require a range of generation technologies to meet their demand. Significant increases in volumes of generation capacity, including from renewable energy sources, will be required to meet Ireland’s electrification objectives and demand from heat pumps, electric vehicles and data centres. The Climate Action Plan sets out a number of actions to ensure that data centres are accommodated in a sustainable manner.
Corporate power purchasing of renewable energy by large energy users that is unsubsidised by the state will also be critical to supplying data centre demand, as will ensuring that large demand connections are regionally balanced to minimise grid reinforcements and the costs to consumers.
The Climate Action Plan includes a target for 2030 to meet 15% of electricity demand by renewable sources contracted under corporate power purchase agreements, with the data centre sector, the first to execute these in Ireland.
