Across the globe, efforts to bolster electrification are raising the projected consumption rates, prompting the need for more renewable energy generation projects to be developed and energised as quickly as possible.
According to the International Energy Agency (IEA), global electric-power generating capacity is expected to increase by 50% to 100% by 2050 compared to present-day levels. Yet, generation is anticipated to grow by only 30%, to 76%.
In the UK, gas-fired output is expected to decline in the short term, and renewable energy generation will ramp up. Interestingly, electricity demand decreased by 3.4% across 2023 in the UK, primarily due to high prices. But whilst the UK saw its electricity demand reduce, across the Celtic Sea, the Republic of Ireland’s demand soared with no expectation for it to be reduced. The cause? A key component of the digital age – data centres.
Remarkably, another IEA report found that Ireland is forecast to have the highest growth rate in Europe for electricity demand and consumption, with an average annual rise of almost 7%. Data centres are expected to contribute hugely, with the nation braced to see a rapid expansion in this sector.
Irish data centres are estimated to have consumed around 5.3TWh of electricity in 2022, up by 31% in 2021. The IEA said this is around 17% of the country’s electricity demand and almost equal to the consumption in all urban dwellings.
The anatomy of a data centre
We must understand the anatomy of a data centre to see why it is raising electricity consumption. According to the US-based, multinational digital communications group Cisco, a data centre is a physical facility that organisations use to house their critical applications and data. Its design is based on a network of computing and data storage resources that enable the delivery of shared applications and data.
The critical components of a data centre design include routers, switches, firewalls, storage systems, servers, and application-delivery controllers.
Cooling is crucial in data centres. Servers produce significant heat while operating, so cooling systems prevent overheating, ensure optimal performance, and avoid hardware failures. However, these cooling systems can consume a lot of energy, partly explaining why Ireland, with its relatively colder climate, is a strategically sound country for developing large-scale data centres.
However, cooling alone does not account for data centres’ high energy demand. Data centres operate 24/7, 365 days a year, as they must ensure servers are running non-stop to ensure data availability and reliability.
Another critical aspect of data centres is the redundancy and backup measures installed in most modern systems. These are often built to ensure data availability in case of hardware failures. Depending on each facility, they may run multiple servers simultaneously, increasing energy consumption.
The final two factors surrounding a data centre include high-density computing and the forecast growth for data services.
Firstly, data centres often utilise high-density computing equipment to maximise processing power per square foot. While this is frequently efficient in terms of space, it can increase energy consumption per unit area.
Given the expanding volume of data and the rise of the Internet of Things (IoT), it’s clear that data centres will be significantly affected. The growing prevalence of cloud computing, streaming services, IoT devices, and similar technologies is placing a strain on data centres, compelling them to expand and consume more energy.
Ireland: a hub for data centres
According to a post by Irish construction consultancy Mitchell Mcdermott, Ireland has risen to the top of Europe’s data centre hotspots, beating rival markets of the FLAPD group (Frankfurt, London, Amsterdam, Paris and Dublin).
The firm stated that Ireland has “deep sea fibre cable connections from the US, Europe and other regions, and a common law legal system which is attractive to many Foreign Direct Investment (FDI) businesses”. These factors incentivise international businesses to select Ireland as the country to develop data centres.
This interest has seen Ireland emerge as a future tech hub. An article published by RTE in April 2024 revealed that Ireland has 82 data centres, with 14 more under construction and planning approved for 40 more. This could lead to a 65% growth in the coming years.
Despite Ireland’s growth as a tech hub, the grid is under increasing strain. In 2022, the Irish state-owned energy company EirGrid placed a moratorium on new data centres in the Dublin area, which is set to last until 2028. However, politicians have insisted they have no plans to limit future developments nationwide. Recent reports show that the government may push to limit new data centre developments that don’t utilise carbon-neutral power sources.
Investment in green energy infrastructure is crucial
Ireland’s renewable energy electricity target is commonly referred to as the RES-E target. Ireland’s NECP 2021-2030 includes a planned RES-E of 70% in 2030, ensuring that renewable energy continues to form the backbone of the nation’s renewable energy use for the coming decade and beyond. Since 2021, Ireland’s Climate Action Plan has included a target to increase the share of electricity generated from renewable energy sources to 80% by 2030.
To ensure that data centres remain critical components of foreign and private investment in the country, renewable energy generation sources must be developed and energised with accompanying power purchase agreements (PPAs) in place to supply data centres.
Concerningly, a recent Cornwall Insight report highlighted a ‘policy vacuum’ for long-duration energy storage (LDES) technologies, threatening Ireland’s 2030 renewable energy target.
The report cautions that without an increase in LDES rollout and deployment speed, Ireland could fall short of its 2030 renewables target, aiming to increase the share of electricity generated from renewable energy sources up to 80%.
An increase in renewable energy generation technologies and the necessary energy storage to provide flexibility to the grid would support continuous growth in Ireland’s tech sector. Without this, and with the Irish government already highlighting their desire only to develop data centres supplied by carbon-neutral energy, the time to scale renewable energy generation technologies is ever more pressing for Ireland.
