Data centres in Ireland

Whilst Dublin remains a major DC cluster in Europe, other countries have developed strategies to increase their appeal to investors. Nordic countries, in particular, have carved out a niche as a location of choice for new European DC builds, by leveraging structural advantages such as plentiful renewable energy and colder climates (which make facility cooling cheaper and easier).

As a result, DC hyperscalers are increasingly adopting a Nordic-first approach, which threatens to drain digital talent and investment from elsewhere in the region – including Ireland.

We know, however, that capital is not the primary issue when it comes to DC construction. Hyperscalers have often indicated that they are willing to invest in the required low carbon generation, grid upgrades, and short-term storage options – in effect, ‘tell us what’s required to get a grid connection and we’ll do it’.

For others considering the optimal mix of on and off balance sheet DCs, there is no shortage of international, institutional capital keen to invest in DC construction – capital that can simultaneously invest in the support infrastructure needed. The availability of such capital opens the way to turn DCs from ‘the problem’ into ‘the solution’, but the ongoing lack of clarity on what is required to gain planning approval for DC projects diverts this capital elsewhere.

This in turn, risks Ireland’s early competitive advantage in DCs, which can soon be overtaken if other European clusters scale as Ireland hesitates. This would be an unnecessary and regrettable sacrifice of Ireland’s digital competitiveness.

The immediate economic impact of diverging levels of DC investment can be seen through the lens of one prominent DC company.