New data centres ‘unlikely’ in Dublin and east, says IDA

IDA Ireland has committed to developing new data centres if tech companies need them, Martin Shanahan said, adding that they will provide “stable demand” for future offshore wind energy.

“Data centres are a component of the technology sector and we have benefited hugely from the technology sector,” Mr Shanahan told the Oireachtas joint enterprise committee on Wednesday.

“Data… is going to be at the centre of just about everything that we are going to need to do from an enterprise perspective.

“Cloud computing, AI [artificial intelligence], the processing of big data, is all part of IDA’s strategy because that is where the world is going.

“That is where enterprises are going. That is where valuable jobs will be going. And data centres will be key to underpinning that. And where companies need data centre solutions, we will engage with those.”

The IT sector was the second-biggest contributor to tax revenues in 2020, after manufacturing, according to the Central Bank of Ireland.

Almost 20,000 new IT jobs were added across 2020 and 2021, the second-largest cumulative increase in those years. IT workers also saw the highest average weekly earnings of any sector in the same period.

Responding to a question by People Before Profit-Solidarity TD Paul Murphy, Mr Shanahan said new data centres “are unlikely to happen in Dublin and the east Coast, at this point”.

The Business Post reported last year that Mr Shanahan had intervened to overturn a temporary ban by energy regulator EirGrid on building new data centres in the Dublin area due to potential energy shortages.

EirGrid has estimated that data centres could eat up 29pc of all electricity demand in Ireland by 2029.

However, Mr Shanahan said data centres will help to generate a “stable energy demand” for future offshore wind farms. Ireland currently has only one offshore wind farm, but is looking to build more to meet its target of generating 70pc of its energy from renewables by 2030.

“Offshore wind should become a reality and my expectation is it will, and there are significant amounts of it required, and [it] will require a stable demand and data centres provide that stable demand,” Mr Shanahan said.