Echelon secures grid link for EUR €3.5 billion data centre

Echelon Data Centres CEO Niall Molloy has indicated that the recent awarding of a grid connection by Ireland's Transmission System Operator (TSO) to one of the company's data centre developments illustrates that Ireland remains a favourable location for data centre investments.

The TSO, EirGrid, has offered a grid connection to Echelon's DUB20 campus, marking the first offer to a large-scale data centre development in over three years. The development, situated in Arklow, Co Wicklow, approximately 60 km south of Dublin, represents a significant step forward for Echelon.

This decision is poised to bring an investment of EUR €3.5 billion in data centre and energy infrastructure to the site. Additionally, 1,100 jobs will be created during the construction phase, with 200 permanent positions once the data centre becomes operational.

Data centre operators have encountered grid constraints in the Dublin area for several years, leading to concerns about a possible moratorium. However, Molloy asserted that the grid connection offer for DUB20 recognises the role that large energy users can play in supporting the national grid.

"The decision to provide a first grid connection to a large-scale data centre for more than three years should offer reassurance to the global technology sector and data centre investors that Ireland remains open for business. It is an endorsement of sustainable data centre development that has a pathway to net zero emissions, and it demonstrates the role of government policy in achieving that," Molloy stated.

DUB20 is noteworthy for being the first large-scale data centre to fulfil the Commission for the Regulation of Utilities' (CRU) 2021 criteria for data centre connections. The facility's onsite energy centres will have the capacity to provide security of supply services to the TSO during periods when renewable generation output falls below grid demand.

The development will feature a 220kV substation, granting access to the grid for renewable energy generated off Ireland's east coast. Echelon is also planning investments in solar, battery energy storage systems, and renewable fuels in an effort to reduce the facility's reliance on fossil fuels. The company now plans to move forward with the construction phase at DUB20.

Molloy further commented, "DUB20 will demonstrate what is possible when we co-locate critical digital infrastructure and renewable energy resources. As well as supporting the development of renewable energy, it will also build grid capacity, it will ensure security of supply, and it will help Ireland transition to a low-carbon economy. DUB20 will be Echelon's most sustainable data centre development to date, and it will be Ireland's greenest large-scale data centre."

Earlier this year, Echelon attracted significant investment from Starwood Capital Group, which invested EUR €850 million to become a 50% shareholder in the company. This transaction also involved a new EUR €900 million debt facility provided by Morgan Stanley and United Overseas Bank, valuing Echelon at approximately EUR €2.5 billion. The Dublin-headquartered company is currently concentrating on expanding into new markets in Europe and North America.