Data centres in Ireland to get cut-price gas in exchange for possible disruption of supply

Data centres are to get cut-price gas in return for accepting a possibility of disruption to their supply under a proposal from the energy regulator. The move comes as the regulator, the Commission for Regulation of Utilities (CRU), warns data-centre expansion will make it hard to source enough gas to meet national demand during extreme cold events. CRU analysis shows just 17 planned new data centres would have the gas demand of six large gas-fired electricity generators or 2.6 million homes. Under the proposed deal, new data centres would get discount gas on condition they accept that when gas demand is very high nationally they may experience planned interruptions. READ MOREThey may have to temporarily power down, postpone energy intensive operations or use an alternative fuel source. The CRU says that is likely to be diesel.The level of discount proposed has not been specified.[ ‘No stopping it’: Noise from Dublin data centre causing ‘a lot of annoyance’ for residentsOpens in new window ]The proposed “interruptible gas connections” policy highlights fresh concerns about the strain data centres are placing on the country’s energy system and raises questions about fairness in energy prices and the climate impact of new fossil-fuel uses. Sinn Féin MEP Lynn Boylan said the proposal amounted to a series of “work-arounds” when what was needed was a halt to data-centre expansion. “Rather than nip the problem in the bud by imposing a moratorium on data centres connecting to the gas grid, the CRU wants to roll out the red carpet for them,” she said. A previous moratorium imposed because of strains caused by huge data-centre demand for electricity was lifted on condition data centres provide their own power. Eventually, most of that power is to be provided from wind, solar and other renewable sources but in the interim, data centres must build their own generators which will run on gas. CRU says there would be enough gas to meet normally high winter demand but during a spell of severe cold there could be a shortfall of 9-18 per cent. [ ‘We just don’t want them’: Hundreds gather in a Kildare town over data centre plansOpens in new window ]That analysis is based on the sector expanding over the next six or seven years to include 17 new data centres that have applied for gas grid connections. Gas Networks Ireland is legally obliged to accommodate them. The analysis “assumes no additional entry capacity is constructed beyond that”. It says the gas demand of the 17 is “equivalent to the peak gas demand of six 500 MWe combined cycle gas turbine (CCGT) generators”. Boylan said the scale of demand was “off the charts”. “For context, the slightly smaller 445-megawatt Whitegate CCGT generator in Cork provides power for 445,000 homes,” she said. “The cheerleaders of data centres in Government will use this as an excuse to manufacture consent for an expensive, destructive LNG [liquefied natural gas] terminal. “Instead of saying to big tech enough is enough, they want to give them anything they want regardless of the impact on the public and climate.” The CRU said: “It has become apparent to the CRU that new large industrial customers – a cohort composed predominantly of data centres and electricity generators – and the new demand load they may require, have the potential to have a major impact on the gas system in the near future.” The regulator said it would not propose interruptible connections for power generators as this “would transfer an unacceptable level of security of supply risk from the gas system to the electricity system”. But it felt data centres could build flexibility into their operations to handle interruptions. In return, “a tariff discount would be applied reflecting the probability of interruption. This would be reflected in the annual tariff-setting process.”The proposal was put to public consultation and submissions from industry and other observers are being examined.