Power-hungry data centres could help the Republic meet its green energy targets by supporting investment in offshore wind projects, a new report argues.
Government targets require developers to build coastal wind farms capable of generating 5,000 megawatts (MW) of electricity, enough to supply the Republic at peak demand, by 2030, up from 25MW now.
Experts commissioned by data centre industry group Cloud Infrastructure Ireland (CII) argue its members’ facilities will be key to getting many offshore wind farms built as they can buy the electricity generated.
CII maintains that construction of the offshore power plants will rely on their developers getting corporate power purchase agreements – deals through which large energy users such as data centres contract to buy electricity. Those deals will give the developers certainty, allowing them to raise the necessary finance to fund the projects in the first place, according to CII, which is part of employers’ lobby Ibec.
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Earlier this week the independent Climate Change Performance Index called for a moratorium on data centres, which the organisation predicted could account for 30 per cent of energy use here by 2030.
The facilities have been under scrutiny for several years as the Republic’s energy networks have struggled to keep up with rapidly rising demand, while high electricity prices have focused attention on big consumers of power. Opponents of such developments, including environment groups, want such projects stalled.
However, the CII report, by UK-based consultancy Baringa, points out that large technology companies already support renewable energy elsewhere in the world through corporate power purchase deals.
Baringa also believes they could help cut business and household electricity bills as such deals would mean wind farms would not have to rely on the State’s renewable energy support schemes, funded through contributions from electricity consumers.
Corporate power purchase agreements could “avoid up to €73 million in State-backed payments under the Offshore Renewable Energy Support Scheme”, the report claims.
Baringa also maintains that as the Republic continues to build offshore wind farms it could end up with a surplus of electricity, potentially forcing operators to periodically shut down some, or all, generation.
Using grid operator Eirgrid’s demand predictions, the consultants say that by 2040 supply from renewables could be 29 per cent to 55 per cent higher than demand. Instead of losing some of this power the firm says data centres could use it.
Dr Mark Turner, Baringa partner, said the findings show how “data centres sit at the intersection of Ireland’s twin digitalisation and offshore wind” goals.
“Our research shows that data centres can benefit offshore wind by providing the revenue certainty required to attract investment and to build projects,” he said.
Michael McCarthy, a director at CII, predicted data centres would be the “ideal market” for the huge amounts of offshore wind power the Republic plans to generate in the future.
Donal Travers, head of technology, consumer and business services at State development agency IDA Ireland, noted that the consultants’ findings showed offshore wind and data centres were “highly complementary”.
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