Dublin-listed energy business Greencoat Renewables aims to tap data centre demand with a joint venture offering tech giants dedicated sites where it will provide green electricity and backup generation.
New rules demand that data centres get their electricity from renewable sources and install backup power plants to take pressure off supplies, as a condition of getting national grid connections.
Greencoat and investor Schroders have joined forces in a venture that will identify and buy sites where they will provide renewable and backup power for data centres.
The new business has already acquired its first site, the old Irish Cement plant in Drogheda, Co Louth.
READ MORE
It is in talks with tech companies interested in building data centres there at what will be called Drogheda Energy Park, according to Schroders Greencoat investment manager Paul O’Donnell.
The venture expects to invest €25 million to €40 million on buying each site, getting planning permission and carrying out whatever development is needed, he said.
The tech companies themselves will build the data centres, whose costs run to about €500 million.
O’Donnell explained that the venture intends using Greencoat’s expertise in renewable electricity to aid data centre developers in meeting the demands of the new rules.
He noted that the Dublin-listed company is Ireland’s biggest single owner of wind farms in the Republic.
“We have been in the Irish renewables business for the last nine to 10 years,” said O’Donnell.
He explained that there was an opportunity to combine green energy generation with the growth of data centres needed to support AI.
While tech companies criticised the rules when the Commission for the Regulation of Utilities published them last year, O’Donnell said there was no sign that the industry’s interest in locating data centres here had waned.
“We do not see the market coming to a halt; Ireland is still a leading data centre location,” he added.
How the conflict in the Middle East is already affecting Irish consumers
The commission was responding to concerns over data centres’ growing energy consumption. They account for 20 per cent of electricity use in the Republic, a figure that could approach one-third in the next five years.
At the same time, data centres support a tech industry that employs 160,000 people in the Republic.
O’Donnell noted that the State was the first to grapple with the twin challenges of the data industry’s growing demand for power and stretched electricity supplies.
He argued that the new rules created certainty and that the digital industry would continue developing here as a result.
“They want to back into growth and they want to expand their presence here,” said O’Donnell.
The new venture is a 50-50 partnership between Greencoat Renewables plc and Schroders Capital Semi-Liquid Global Energy Infrastructure, which is part of Schroders Greencoat.
