Taking the heat on data centres
RTE this week reported claims by the Industrial Development Agency (IDA), the body in charge of attracting foreign direct investment to Ireland, that some multinationals operating in the country had endured “considerable financial loss” due to a 2020 decision by Eigrid, which operates the national grid, to cease allowing new connections for data centres.
A note sent to the government, and seen by RTE, went so far as to suggest intervention in order to protect Irish international industrial competitiveness.
“Increases in electricity bills through grid costs, as well as any perception of likely price volatility, are likely to undermine business confidence, tighten margins and dampen investment as businesses factor in higher costs and cost uncertainty,” it said, noting it was important that “Ireland, at a minimum, does not lose its relative competitiveness in the EU”.
Consumers could be forgiven for scoffing. With an energy crisis looming, the plight of data centres is surely quite far down the scale of concern. Given the widespread expectation that not only will energy bills continue to skyrocket, but fears of rolling brownouts and blackouts, clearly domestic energy provision is of paramount importance.
Indeed, it is not just Ireland that is bracing for energy problems this winter. Even with France’s massive nuclear power capacity, the University of Strasbourg announced this week that it would extend its Christmas holidays by a week, add a week of distance learning, turn down the thermostat in lecture theatres and offices, and ban space heaters due to rising energy costs.
Data centres, though, have become politically toxic in Ireland. Seen as little more than massive consumers of electricity for the benefit of, often none too popular, corporations, they have borne the brunt of criticism of energy use by industry, something not helped by their fundamentally immaterial nature. After all, factories use plenty of energy, but, unlike with data centres, with factories we can take their output “hold it to the light, turn it in our hands, to study all the angles,” as the song goes.
Among the principal objections to data centres is the fact that they are not significant creators of jobs. The reality is that while data centres themselves do not employ large numbers of people, the data they store and process represents every job in the country, from civil servants processing motor tax applications to bank transactions, and from social media posts to production line data.
It is true that the technology industry in particular is not sufficiently scrutinised, whether in Ireland or anywhere else, and thanks at least in part to source capture the tech giants in particular are addicted to seeing their names and the faces of their executives only in positive news stories. When criticism does happen, then, it is for the good, but we should be careful to avoid wrongheaded scapegoating.
Businesses, neither multinational nor domestic, in the tech sector or otherwise, deserve no special treatment and any price freezes or caps should apply equally to consumers. However, it would be foolish to imagine data centres are energy pirates, intent on gorging down Ireland’s precious electricity supply.
If claims saying data centres could use 70% of Ireland’s electricity by 2030 prove true (at present the figure is an already high 14%) then that is clearly unacceptable for the country. Nonetheless, the rising cost of energy in light of the Europe-wide crunch following the imposition of sanctions on Russia should at least give us pause to ask if Ireland’s energy production and distribution capacity needs a major rethink.
One bright spot, small though it is, is the Tallaght District Heating Scheme. The first large-scale district heating network of its kind in Ireland, will soon be heating homes in south County Dublin.
Districting heating is far from a new idea – for fairly obvious reasons it is quite common in Scandinavia – though it is relatively new to Ireland. The fact that data centres produce so much heat has given rise to re-use of their heat in schemes in the US and Denmark. Indeed, earlier this year TechCentral.ie reported on similar plans for Ireland by Equinix, as well as on plans for the Tallaght scheme in 2020.
District heating alone is not a solution to the energy crisis, but it is clearly a positive move. What is needed more than ever, though, is a broader strategy capable of meeting the energy needs of a modern nation.
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