New data centers may need to show power

The ability of new data centers to have their own on-site generation capacity equal to or greater than their demand, to support supply as needed, will be an important factor in future decision-making about whether to access the national power grid.

The ability of data centers to reduce power consumption when prompted during times of scarcity will also influence decision-making.

This is according to the conclusion of a consultation process conducted by the Commission for Regulation of Utilities (CRU) on data centers.

Whether a planned data center is located in a part of the country where electricity supply is limited will also be an important part of the decision, the regulator has decided.

Those policies would make it less likely that further data centers will be built in and around Dublin, where electricity supplies are particularly limited.

“The assessment criteria provides data center operators with a number of options to provide solutions for all future applications in terms of generating their own low-carbon generation and reducing consumption when needed,” said CRU Commissioner Jim Gannon.

The CRU says the new connectivity policy, which tracks engagement with data center providers and other contributors, represents a balanced decision that protects security of supply and facilitates growth.

It also says it has removed the need for radical policy changes or the implementation of a moratorium on new data center connections and provided clarity for future and existing application.

The regulator, which warned in its summer consultation paper that inaction would lead to progressive blackouts for consumers, also said the new approach would reduce risks to the electricity grid.

The rapid growth in the number of data centers here in recent years and their demand for electricity has put considerable pressure on the national grid.

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Over the past four years, EirGrid has seen an annual increase in demand usage of approximately 600 GWh from data centers alone – equivalent to adding 140,000 households per year to the electricity system.

Data center applications whose electricity demand would total 1,000 MegaVolt-Amperes were received by EirGrid last year.

Adding about 1,000 MVA of demand load would be equivalent to adding more than 16 cities with energy consumption comparable to Kilkenny’s to the grid in a relatively short time frame, CRU said.

EirGrid’s analysis shows that by 2030, data center demand could account for 23% of all demand in Ireland in a medium demand scenario and 30% in a high demand scenario.

This predicted rapid growth in data center demand is due to the Irish electricity grid undergoing fundamental changes to reduce emissions by switching to renewable energy sources.

Data center providers prefer Ireland due to the presence of a large number of technology companies here, its geographic location between the US and continental Europe and the temperate climate which makes it cheaper to cool the facilities.

New applications under the connection policy are assessed by EirGrid and ESB Networks.

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Commissioner Gannon said an EirGrid forecast that data centers could account for nearly a quarter of all electricity demand here by 2030 is sustainable if measures are taken to address demand growth and infrastructure is provided to facilitate it.

Jim Gannon said EirGrid and the ESB may assess data center interconnection applications on a number of criteria, including locations and transmission infrastructure.

He explained that decisions will be made based on where the existing generation exists and that the strength of the network has the capacity to take the additional load.

Separately, new data centers will be tasked with bringing some solutions to the table, he said.

Mr Gannon said this could include lowering productivity at certain times and storage options.

Speaking to RTÉ’s News at One, he said centers will face this challenge if they apply for electricity connection.

He added that centers in other jurisdictions “follow lunar policy” and reject processing capacity at different times.

Gannon said the CRU has not been prescriptive about technologies data centers should use, but many have said they will explore less carbon-intensive methods.

He said there is significant internal pressure among data center developers pushing them into a “lower carbon direction”.

He said EirGrid has been asked to report to the CRU every six months on the effectiveness of these measures.

Transport, Environment, Climate and Communications Minister Eamon Ryan said data centers must “live within the limits of our climate plan” and like any industry will need to help Ireland meet its climate targets.

He said any Commission decision on the utilities regulation and EirGrid will put climate first.

“Data centers bring benefits to the country, but not at the expense of other sectors or us meeting our climate targets and they know it,” he added.

ESB Networks said it had provided input to the CRU decision document as part of the consultation process.

“We will review the published decision paper with a view to pragmatically implementing its provisions,” it said.

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