Data centres take 21% of Irish power

AI does not live in the air. It runs through data centres: large, power-hungry buildings that keep the cloud, streaming platforms, banking systems and chatbots moving. Across Europe, those buildings are being approved faster than electricity grids can absorb them.

The EU wants to triple data centre capacity within five to seven years, from about 10 gigawatts today to as much as 35 GW by 2030. That is enough demand to resemble a medium-sized industrial country. Brussels also wants the sector to be climate-neutral by the end of the decade.

Two EU laws now pull the system in different directions. The Cloud and AI Development Act, adopted in June, is meant to accelerate construction. The Energy Efficiency Directive forces data centres to report their energy and water use and to recover waste heat, meaning the heat produced by servers should be channelled into local heating networks rather than released outside. For small member states such as Malta, where every large energy user is visible on the system, this is not a remote infrastructure debate. It is the same question households already understand from their bills: who uses the grid, who pays for it, and who gets priority.

The Irish Warning

A United Nations assessment this week described Ireland as "a live cautionary example" of what happens when data centre growth runs ahead of energy planning. Data centres now consume 21% of all metered electricity in Ireland, up from 5% in 2015, and use more power than all the country's urban households combined.

The cost has landed on ordinary consumers. Between 2015 and 2023, rising data centre demand added an estimated €715 million to Irish household electricity bills, about €263 per household. Irish families pay almost twice the per-unit rate paid by data centres, which means grid costs are being shifted quietly onto residential customers. EirGrid, Ireland's national grid operator, expects data centres to consume 31% of national electricity by 2034.

A Continent-Wide Bottleneck

Ireland is the sharpest case, but the same pressure is appearing across Europe.

In the Netherlands, more than 14,000 large-energy-user applications are waiting in TenneT's connection queue. Amsterdam has imposed a moratorium on new data centres. The Dutch parliament demanded a crisis law; the government split it into 26 legislative tranches and promised the first part "just after summer."

In Germany, data centres consume 40% of Frankfurt's electricity. The city's utility cannot offer major new grid connections until the mid-2030s. AlgorithmWatch and LobbyControl found that lobbying language from Google and Microsoft was adopted almost word for word into draft legislation weakening the Energy Efficiency Act, including proposals to treat consumption data as trade secrets.

France is using its nuclear fleet to try to make itself Europe's AI infrastructure hub. President Emmanuel Macron secured about €90 billion in data centre investment commitments at the Choose France summit. But RTE, the French grid operator, is already facing structural bottlenecks: 9 GW of capacity under contract or review, compared with just 1.3 GW installed today.

In Italy, grid operator Terna has more than 50 GW of connection requests, roughly half from data centres. Lombardy responded in May with what may be Europe's first regional data centre law, doubling construction fees on agricultural land and banning the use of public drinking water for cooling.

Tightening the Screws

EU regulation is now catching up with the build-out. Since May 2024, every data centre drawing more than 500 kilowatts of computing power, meaning all but the smallest operators, must report its energy and water use every year. By August 2027, each will carry a public sustainability label from A to G. The Commission plans to propose binding efficiency standards by 2027, the first minimum performance rules for the sector.

The question is enforcement. Germany has started fining operators that fail to report. Most member states have not.

Finland shows how delicate the politics are. Its clean grid and cold climate make it attractive for data centres. But when Helsinki raised the electricity tax on the sector, Google paused major planned investments within months. The same governments competing for AI investment must also limit its demand for power, water and land. The Cloud and AI Development Act gives Europe's data centre boom legal momentum. The grid is setting the real limit.