Ireland faces power shortages amid growing demand for data centres

As artificial intelligence continues fuelling surging demand for data storage and processing, Europe's energy infrastructure is facing increasing pressure.

The rise of power-hungry artificial intelligence is reshaping Europe’s data center landscape, and Ireland, once at the heart of the continent's tech industry, may lose its dominant position, Caliber.Az reports via foreign media.

When people stream movies or check their email, they rely on data centers — the physical infrastructure that supports the digital world. These vast rows of server racks have become a cornerstone of Ireland's economy, with the country serving as the EU hub for many major tech companies. A recent report by the US-based Synergy Research Group found that Dublin is the world's third-largest hyperscale data center hub and the leading location in Europe. Hyperscalers, such as Amazon, Microsoft, and Google, are large cloud providers that operate extensive networks of thousands of data servers.

However, the ever-growing demand for electricity driven by AI — which could double by 2026 — might force Ireland to relinquish its cloud dominance, as the country's power grid struggles to meet increasing demand. "This is a risk we must take very seriously," said Seán Kelly, an Irish member of the European Parliament, expressing concern over the “major failing” in the country’s ability to upgrade and expand its grid to meet the needs of today’s digital economy. As a result, Ireland's electricity network operator, EirGrid, has been reviewing "data center applications… on a case-by-case basis since November 2021," according to an EirGrid spokesperson.

The company has effectively imposed a moratorium on new data centers in the Dublin region, which already has highly concentrated energy infrastructure. EirGrid has reportedly warned Irish officials of a potential "mass exodus" of data centers if the situation doesn't improve. Since 2016, it has raised alarms about the growing gap between supply and demand for electricity in Ireland, the spokesperson added. According to Ireland's Central Statistics Office, data centers accounted for 21 percent of the country's total metered electricity consumption last year — surpassing the electricity usage of urban households for the first time.

“There is a risk that the pace of demand growth is faster than the speed at which generation and network infrastructure can be built,” said a spokesperson for the country’s energy regulator, the Commission for Regulation of Utilities. This confirms that long-term risks include "power shortages" and "increased costs for consumers." For MEP Kelly, “The absolute priority has to be to keep the lights on,” he said. However, he added, “we should not be in a position where we have to turn away business and investment.” “A properly developed and modernized transmission system would be able to do both,” Kelly added.

By Naila Huseynova