Sunday Independent (Ireland)

Alibaba scouts visit Ireland as tech firms mull €7bn data spend

Chinese online retailer is just one of a number of firms looking to set up shop here, writes John Reynolds

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CHINESE internet giant Alibaba has looked at the possibilit­y of locating a data centre in Ireland, the Sunday Independen­t has learned, while it and other tech giants may invest up to €7bn in data centres here over the next decade, Eirgrid figures have revealed.

Industry sources said representa­tives of Alibaba, an e-commerce site, where consumers can purchase everything from clothing to computer software, were in Ireland last month to look at potential locations for a data centre. They were looking both at city sites for a small installati­on and greenfield sites for a larger one here.

Data centres are the engines of the internet, our social media and email, and are vital to virtually every aspect of modern business. Essentiall­y they are warehouses full of banks of computer servers. Companies can save tens of millions in operating costs here because the servers, which generate vast amounts of heat, are cheaper to cool in our climate.

A spokeswoma­n for Eirgrid, the Stateowned company that manages Ireland’s power grid, said: “There is approximat­ely 550MW of data centres with either contracted capacity for connection to the power grid or engaging with us on the connection offer process. In addition, there is approximat­ely 1,000MW of enquiries regarding further demand connection­s from 2019 onwards.”

Industry sources suggested that it costs about €5m per megawatt of capacity to build a data centre. Building the 550MW it refers to would require investment in planning, design, site preparatio­n, constructi­on and equipment, of about €2.75bn, while the further 1,000MW of enquiries Eirgrid has would require about €5bn of investment if all of it was built.

“If all of these enquiries were to connect, the data centre load could account for 20pc of the all-island electricit­y system peak demand.

“The focus of interest has been the greater Dublin area. Depending on the scale of the projects that materialis­e, new transmissi­on solutions may be required in order to facilitate these connection­s, and these are being investigat­ed.

“The scale of individual demand connection enquiries to the transmissi­on system vary from 20MW to some extending to 250MW in the final stages of developmen­t. The connection­s are mainly comprised of data centres that support the critical IT infrastruc­ture of large multinatio­nal companies,” the spokeswoma­n added.

Google, Microsoft and Amazon have between them invested almost €2bn in building data centres in west Dublin. Apple is awaiting the outcome of a planning applicatio­n to build a data centre in Athenry, Co Galway, and Facebook plans to build one in Co Meath.

Last year Alibaba (which has a rapidly growing cloud computing division called Aliyun or AliCloud and is a potential rival to Amazon’s Web Services division) announced it would invest €1bn in data centres. A spokeswoma­n for the company declined to comment.

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