Earlier yesterday, I read an Irish Independent article that implied Ireland will have to choose between AI and housing due to power shortages caused by data centres. Watch video HERE.
Recently, I had also realised that Uisce Eireann was dealing with a lot of pressure nationwide due to its poor infrastructure. Some counties even have a hosepipe ban enforced this summer in a desperate effort to conserve water. On a similar note, Ireland is currently in need of tens of thousands of houses, with large areas of the country unsuitable for new housing developments due to a lack of water services.
AI Data centres require a ridiculous amount of electricity to power, and an even greater amount of water to cool. Both resources seem to be in short supply in Ireland at the moment, and this matters even more during a housing crisis when these two resources are extremely vital for housing supply and for our own daily survival.
Ireland’s insanely rapid digital transformation (or should I say its very low 12.5% corporation tax) has made it very attractive for data centres. This has attracted every global tech giant imaginable and has led to the creation of 121 data centres and counting (108 of these are in Dublin alone). However, this growth clearly brings significant challenges, particularly housing supply, energy consumption and its implications for housing development.
This blog post is not meant demonise data centres, but rather, to objectively analyse the possible future impact of AI data centre energy and water usage in the context of the Irish housing context.
The Surge in Data Centre Energy Consumption.
Data centres in Ireland have experienced exponential growth in energy usage. The percentage of total metered electricity consumption used by data centres rose from 5% in 2015 to 21% in 2023.
In 2023, urban households accounted for 18% and rural households for 10% of total metered electricity consumption
There have been no updated reports since, but it will not come as a surprise if new reports showed even higher energy consumption by Irish data centres. Projections indicate that by 2030, data centres could account for up to 30% of Ireland’s electricity demand. (The Journal)
The Benefits of Data Centres in Ireland.
Despite the above concerns, there’s no denying the economic and strategic advantages that data centres currently bring:
1. ECONOMIC INVESTMENT & JOBS
- Big tech firms like Amazon, Microsoft, and Google have invested billions into Irish infrastructure. These investments boost Ireland’s economy through job creation, corporate tax revenue, and construction spending.
- The construction phase of these centres provide local jobs, and their presence boosts Ireland’s profile as a tech hub.
2. DIGITAL SOVEREIGNTY & INFRASTRUCTURE
- Hosting data on Irish soil provides strategic control for both public and private services, particularly in an era of cloud dependence. For example, the HSE can store and process sensitive health records securely within Ireland, ensuring compliance with EU data laws and reducing foreign dependency.
- Data centres ensure faster connectivity, which is critical for the success of AI, fintech, and other emerging sectors.
3. REGIONAL DEVELOPMENT OPPORTUNITIES
- When strategically placed outside Dublin (i.e Letterkenny & Ballina), data centres can stimulate rural and underdeveloped areas, providing infrastructure, fibre networks, and employment opportunities that otherwise wouldn’t exist.
2. The Downsides – Strain on Critical Infrastructure
- POWER GRID STRESS
- According to FOE projections, data centres could consume up to 30% of national electricity by 2030.
- This demand competes directly with the grid capacity needed for housing developments, hospitals, and public transport electrification.
2. THREAT TO HOUSING DELIVERY
- As revealed in the Irish Independent article, Ireland may soon be forced to choose between allocating scarce power to data centres or new homes.
- With over 60,000 people on housing lists, this isn’t just a technical issue; it’s a social one!
3. WATER RESOURCE DEPLETION
- Some centres use millions of litres of water daily for cooling; rivaling consumption in medium-sized towns. A 2021 research showed that in some cases, the water for cooling servers was made up of up to 57% potable water!
- This is especially alarming in the context of recent hosepipe bans across the country and a water system that leaks more than 40% of its treated supply.
4. LOW LONG-TERM EMPLOYMENT YIELDS
- Once operational, data centres require very few staff, sometimes as low as 30–50 full-time employees, despite taking up vast areas of serviced land and utilities.
The Broader Implications of Data Centres for Ireland.
1. Grid Prioritisation – A Fork in the Road
If energy capacity is finite, what gets prioritised?
- Housing, Health Care and transport electrification serve public welfare.
- Data centres, although profitable, mainly serve private interests. This is an ethical and policy challenge that Ireland MUST confront now, not when the lights start flickering.
Presumably, in 2022, EirGrid issued a ‘moratorium’ (temporal prohibition) on the development of new data centres specifically in Dublin until 2028. This was primarily due to the impact of data centres on Ireland’s energy infrastructure and concerns around capacity. (Public Policy)
Additionally, there is a push to encourage new data centres to be built in regions with renewable energy potential, such as the Midlands, to reduce environmental impacts and balance regional development. (Midlands 103)
In my humble opinion, these still do not help to address the issue of public welfare.
2. National Security & Over-Reliance on Tech Giants
As Ireland grows increasingly dependent on foreign tech infrastructure, the balance of power can shift.
- What happens if policy disagreements arise or these corporations demand more concessions?
For instance, if energy caps or stricter regulations are introduced, firms like Microsoft, Google and Amazon could pressure the government for exemptions by leveraging their economic importance.
This could create a power imbalance, where public policy is shaped around corporate interests, while ignoring national priorities like housing, better health infrastructure or environmental goals.
3. Environmental Commitments at Risk
According to the Environmental Protection Agency (EPA), Ireland already struggles to meet its 2030 climate goals. A high concentration of energy-intensive facilities risks breaching carbon budgets — especially if these centres aren’t run entirely on renewables.
USEFUL FAQS
- HOW MUCH WATER DO DATA CENTRES ACTUALLY USE IN IRELAND?
”…The Government’s Statement on the Role of Data Centres (Government of Ireland, 2022) indicates that Uisce Éireann supplies approximately 608,000 megalitres of water annually, of which 0.13% (c.810 megalitres) is consumed across all known data centres.
While this value indicates data centres are a low water user, a comparison of water consumed by data centres to a value of water supplied nationally, is not fully transparent on the pressure this industry may have regionally...” See more HERE.
The above answer does not account for the fact that close to 40% of water supplied by Uisce Eireann is lost each year through leakages. Or that almost 90% of current data centres are stationed in Dublin – so a regional comparison will be more accurate.
2. WHAT PERCENTAGE OF ELECTRICITY IS USED BY DATA CENTRES IN IRELAND?
21% in 2023. Projected to be up to 30% in 2030.
3. WHY DOES IRELAND HAVE SO MANY DATA CENTRES?
Ireland’s low corporation tax rate of 12.5% is very attractive to multinationals such as Google, Facebook, Amazon and plenty more. Most EU countries have their corporation tax at 20% and above, so it makes sense that many companies would base their European headquarters in Ireland.
I would do the same.
Conclusion – A Need for Measured Growth & Reform
At the start of this article, I claimed I wanted to look at the topic of data centres objectively. But as my research went on, I developed a more negative bias than I had anticipated.
Regardless of my bias, data centres are not villains. They are vital components of a modern digital economy. But Ireland must reframe how and where they fit into the national development strategy. The current trajectory — where data centres threaten to outbid housing for electricity and water — is unsustainable.
What’s needed is:
- Public Service Prioritisation — especially housing — when allocating finite utilities. Especially now when Ireland is dealing with its most unprecedented housing crisis.
- Stricter Regional Planning to keep data centres out of already-overstretched areas like Dublin even after 2028.
- Transparency on the environmental and social trade-offs of each new data centre approval.
- And perhaps most importantly, a national conversation on whether economic growth should come at the cost of accessible housing and basic public services.
