Baringa report highlights the essential role of data centres in modern Irish society

Baringa, a leading management consultancy in the energy, utilities and resources sectors, and Bitpower Energy Solutions, a specialist data centre consultancy, today published a report that examines the role of data centres in modern Irish society, the social and economic value that the data centre industry brings to Ireland, and the essential role that data centres play in helping Ireland to meet its climate goals.

The report, which was commissioned by Cloud Infrastructure Ireland, also sets out a vision for the future of the industry, and the actions that must be taken by the sector, Government, and other stakeholders to ensure a sustainable future for the industry in Ireland.

The key findings of the report (available below) include:

• Data centres are essential for modern society, powering the cloud and the digital revolution that is transforming all sectors of the economy.

• Data centres can help accelerate the energy transition in Ireland by:

1. directly supporting new renewables projects;
2. financing improvements in energy security and networks;
3. offering grid support services to facilitate renewables integration;
4. supporting innovative solutions to achieving a zero-carbon power system in Ireland; and
5. providing zero-carbon heat to neighbouring buildings.

• Data centres are critical enablers of decarbonisation:

1. Typically, they use 80% less energy per computing load than traditional on-premises servers, reducing emissions from computing.
2. They reduce the need for travel and physical goods, lowering emissions from transport and manufacturing. 

• Data centres attract over €1bn of direct investment into Ireland annually, and are a key part of Ireland’s computer services industry, which generated €134bn of exports in 2020, representing 33% of all Irish exports. The computing industry in Ireland supported more than 90,000 jobs in 2020, with these jobs growing at more than twice the rate of overall jobs growth and being amongst the best-paying jobs in Ireland. 

Dr. Mark Turner, Partner with Baringa, said: “This report reveals how hyper-scale data centres are vital cogs in the Irish economy and can play a positive and long-term role in helping the country progress its sustainability goals. The report also establishes that data centres, and the digitalisation they enable, can drive emissions reductions across the economy in multiple ways. 

“The report contains clear recommendations for policymakers that could, if implemented, unlock additional investment in Ireland’s digital infrastructure and help develop a more robust and sustainable domestic power system. Their implementation would also generate a number of other benefits, including boosting the economy, strengthening Ireland’s digital leadership, and facilitating its energy transition.”  

Michael McCarthy, Director of Cloud Infrastructure Ireland (CII), said: “This report clearly outlines both the advantages and opportunities that hyper-scale data centre investment creates for Ireland. Whilst recent growth of our sector has brought challenges, the report sets out how they can be jointly addressed by industry and policymakers while preserving the benefits that this digital infrastructure continues to deliver for people and society here.” 

McCarthy continued: “The findings on sustainability and energy transition are especially telling. Many decarbonisation solutions depend on data centre capabilities, including software to manage energy use and platforms to buy renewable energy. These are cheaper, faster and more easily scalable thanks to the cloud. A cross-sector study in Germany, for example, found that potentially half of the country’s planned reductions in emissions by 2030 could be delivered by rapid digitalisation. 

“The Baringa-Bitpower report shows that we have a similar opportunity in Ireland. By engaging with the sector, we have the potential to create a win-win scenario whereby Ireland continues to benefit from investment in the most efficient data centres while also harnessing the cloud to address escalating climate challenges.” 

David McAuley, Founder and CEO of Bitpower, added: “Hyper-scale data centre operators have a track record of investing directly in renewable generation in Ireland. We believe that with positive engagement the industry can play an important role in helping to realise the ambitions of the Irish Government’s Climate Action Plan.”