A failure to lure investment in new power plants rather than data centres is the reason the Republic is facing an energy squeeze, a leading planner claims.
Irish electricity users are relying on temporary generators to plug gaps in power supplies as the State continues to grapple with rising demand.
Gavin Lawlor, director of planning consultancy Tom Phillips and Associates, says that the growing number of data centres here are unfairly blamed for the State’s failure to tackle the problem.
[ EirGrid warns of possible data centre ‘exodus’ amid connections rowOpens in new window ]
The data centre industry has met with fierce criticism in recent times, amid a spike in the amount of energy they use at a time when Ireland is struggling to meet its targets to cut emissions. Data centres used about 21 per cent of all electricity in the State last year, according to the Central Statistics Office compared to 5 per cent in 2015. That number is expected to hit 27 per cent by 2028. They already use more power than all urban households in the country.
Mr Lawlor, whose firm advises data centre developers, argued that the industry had become a “whipping boy” for policy shortcomings.
He pointed out that many of these facilities have their own generators and can actually supply power to the national electricity grid if called on.
“And they can all come off the grid for two to four hours with notice and they have done so quite often,” Mr Lawlor added. “The problem is that we are not generating enough conventional electricity to fill the dips in renewables,” he said.
The planner said that the State had consistently failed to attract investors willing to build new gas-fired power plants, even while the Government and national grid operator EirGrid agreed that they were needed.
Mr Lawlor maintained that the Single Electricity Market Committee, made up of representatives of regulators from both sides of the border, was not offering enough cash to developers to encourage them to build new power stations.
However, the Commission for the Regulation of Utilities (CRU) noted that the committee had set a price cap of €230,000 a year per megawatt for those bidding to build plants meant to be ready for 2028/2029.
The CRU noted that the move was meant to “incentivise developers to invest” in power plants.
The committee, on which the CRU and the North’s Utilities Regulator are represented, is the decision-making body for the all-Ireland electricity market.
Former EirGrid chief executive Mark Foley warned the Joint Oireachtas Committee on Environment and Climate Action earlier this year that the State needed to increase payments to developers to attract investment.
The single electricity market offers so-called capacity payments through auctions that are designed to secure investment in new natural gas generators.
However, one such auction held last November failed to attract any significant bids.
Eamon Ryan, the Minister for Environment, Climate and Communications, and his department last year got planning permission for temporary power plants to ensure there was not a shortfall in the Republic’s electricity supplies. Several began operating this year.
Meanwhile, Mr Lawlor said that, alongside the shortage of power plants, EirGrid was not working fast enough to prepare the national grid for increased demand and the shift to more renewables.
He claimed that the company should have responded to objections to big projects like the long-delayed North-South interconnector by putting cables underground, as opponents sought, rather than overhead.
However, EirGrid pointed out that several independent reviews of the North-South line found that overhead was the most appropriate. The company stressed it would use underground cables where suitable.
EirGrid pointed out that it had a programme of work aimed at strengthening the grid and preparing to handle “unprecedented change” over the rest of the decade.
A spokesman for the Department of Environment, Climate and Communications said that the Government had “delivered on energy security throughout the international energy crisis” and continued to plan for this in the future.
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