CRU Publishes direction to Eirgrid and ESB Networks regarding data centre grid connections

CRU Publishes direction to Eirgrid and ESB Networks regarding data centre grid connections
  • Data centre flexibility key to providing positive solutions for future connection

 

  • Applications will be assessed by EirGrid and ESB Networks based on location and ability to provide mitigations for security of supply challenge

 

  • Constructive engagement from data centres and other contributors provides balanced decision which protects security of supply while facilitating growth

 

The Commission for Regulation of Utilities (CRU) has today published its decision regarding the connection policy for data centres in Ireland, outlining an approach to connection applications that will now include assessment criteria encompassing location and the ability to contribute to security of supply.

The constructive engagement with industry stakeholders during the consultation has removed the need for radical policy changes or the implementation of a moratorium on data centre connections. The decision also provides clarity for prospective and existing applications and mitigates the risks to the electricity network.

The unique scale and nature of electricity demand that accompanies growth in data centre activity poses a significant challenge to Ireland’s electricity network and security of supply, if left unaddressed. This decision provides a balanced response that presents the data centre industry with an opportunity to grow, while addressing this inherent challenge.

The CRU, informed by EirGrid recommendations, was concerned that continuing to allow data centres to connect to the electricity network, in accordance with previous arrangements, would significantly impact the ability of the electricity system to meet the reasonable demands of all consumers, including those data centres already connected to the network.

In its recently published Generation Capacity Statement, Transmission System Operator, EirGrid outlined the expected electricity demand growth as the Irish economy grows in the coming years and highlighted that data centres will be a distinct and key driver of both demand and growth in Ireland for the foreseeable future.

The CRU has worked with EirGrid to identify appropriate short, medium and long-term measures to ensure available supply can meet all reasonable demands.  In the recent CRU Programme of Actions published in September, the CRU set out the mitigation measures that are being put in place, together with EirGrid, DECC and other stakeholders to ensure electricity Security of Supply in the coming years as we decarbonise our economy.

This forecasted rapid growth in demand comes at a time when Ireland’s electricity network is undergoing fundamental changes to facilitate a low carbon future and the stated Government Climate Action Plan target of achieving 80% of electricity demand from renewable energy sources by 2030. The CRU is ambitious about meeting Ireland’s policy goals and working with industry to ensure that we decarbonise our electricity system in a safe and secure way, and to the benefit of all.

 

Mitigation Measures

In the consultation, the CRU outlined three mitigation options that it had considered with a view to managing the data centre connection demand challenge. These were:

1. Do Nothing: taking no action would likely result in a situation where demand would outstrip available supply at the peak and would result in load shedding and consumers facing rolling blackouts

2. Moratorium on Data Centre Connections: Stopping processing all data centre connection applications (including modifications) and new connection applications for a certain number of years, until this demand can be safely and securely facilitated by the network.

3. Connection Measures: the assessment of connection applications based on;

  • the location of the data centre applicant with respect to whether they are within a constrained or unconstrained region of the electricity system.
  • the ability of the data centre applicant to bring onsite dispatchable generation (and/or storage) equivalent to or greater than their demand, in order to support security of supply.
  • the ability of the data centre applicant to provide flexibility in their demand by reducing consumption when requested to do so by the system Operator in times of system constraint through the use of dispatchable on-site generation (and/or storage) in order to support security of supply.
  • the ability of the data centre applicant to provide flexibility in their demand by reducing consumption when requested to do so by the relevant system operator, in times of system constraint, in order to support security of supply.

The CRU decided that options one and two were not acceptable scenarios and did not represent a suitable response. The final option was chosen as it represented the most equitable solution, a balanced approach that provides connection opportunities to data centre applicants in a manner which respects the overall system integrity, while balancing the need for all consumers to have a secure and stable supply of electricity.

The full decision can be found on here

Commenting on the programme, Commissioner Jim Gannon said: “We thank all stakeholders and industry for their consultation responses, and believe the decision announced today provides a very clear direction for the data centre industry and importantly accommodates growth in the sector while maintaining a responsible and balanced approach to Security of Supply. 

The assessment criteria provides a number of options for data centre operators to bring solutions for all future applications in terms of their own low carbon generation and reducing consumption when that is required.”