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What’s driving data centre market growth in Ireland, and what does this mean for wider tech infrastructure?

Over the last decade, Ireland has very quickly emerged as a cloud computing hub for global technology organisations, providing a safe, compliant, and versatile environment for data storage. Major providers such as Amazon Web Services, Microsoft and Google have already started collocating core platforms across the country, encouraging others to quickly follow suit.

With Dublin hosting several major tech EMEA headquarters, storing data within close proximity to original deployment locations makes logical sense. And with so many of the big, and small, providers putting their data in the country – particularly as a result of the virtual world in which we now live – the number of data centres across the region has rapidly increased.

In the last twelve months alone, 10 new data centres have popped up, putting investment in these facilities above €7 billion between 2010 and 2020. It’s now estimated that there are 70 operational data centres in Dublin alone, with a further eight under construction and several more in the planning stages.

The pandemic has accelerated this growth significantly with more organisations flexing towards a virtual workplace and recognising the benefits of storing their company data and applications within the security of the cloud. Ireland is certainly feeling the benefit of this, but other than being the preferred location for the big players, what is it that’s attracting businesses to store their data in the country?

External factors impacting growth in Ireland

As technology advances and new data regulation laws are introduced, politics is having an increasing impact on our approach to data and where it should be stored.

Looking back at one of the biggest British geopolitical stories of a generation, and the uncertainty it has often brought, it’s clear why Ireland has become the chosen home for big corporations looking to continue the free flow of data to other regions in and out of the European Union. Choosing Dublin has made for a safer and more secure home within Europe for many organisations.

Ireland is also well on its way to a sustainable clean energy future – an important consideration as more organisations look to factor this into their buying decisions. Irish targets to achieve net-zero carbon within the next 30 years aligns with continued consumer and company demands. With more businesses now factoring in and recognising their environmental impact, decision-making processes have been overhauled to ensure data centre capacity purchases are done in a sustainable and ethical way long-term.

What this means for wider tech infrastructure

Because of continued growth in data volumes and broadband penetration driving digital services housed in Ireland, existing tech infrastructure has been massively stretched. A total of 54 new data centres have been built since Amazon invested an estimated €1bn in its Irish expansion back in 2004. As a result, Ireland is now the fastest-growing data centre market in Europe, with more than a one-billion-euros worth of projects planned, according to the Data Centre Developments in Europe report.

With the pandemic forcing much of the world to pivot to remote, dispersed working environments, the need for a versatile data infrastructure has grown, with many organisations moving away from physical data storage solutions to ones that are based in the cloud. Technology infrastructure everywhere has been tested, but the move to securing data centres has seen significant strain put on pre-existing infrastructures.

With a continued number of companies expressing interest in moving their data away from individual servers and instead to cloud facilities, current infrastructure is going to need to be overhauled whilst at the same time ensuring it is being decarbonised.

Research from EirGrid highlights that by 2027, data centres could account for 29 percent of Ireland’s total energy demand. Finding a way to do this sustainably and safely without contributing to the growing climate crisis will be key. There will be a significant need to grow the IT infrastructure serving data centres, but there will be a greater need to ensure this is done in a way that is sustainable.

What the immediate future holds

With the growth in the number of data centre sites within Ireland, has come an increased number of jobs created for the Irish population. Ireland has one of the youngest and most diverse workforces in Europe, and the clustering of technology companies and data centres has provided a critical mass of talent and skill to satisfy current demand.

But with demand set to grow over the coming years as cloud becomes even more important for businesses, statistics suggest the number of pupils choosing IT subjects at exam level are decreasing. Organisations and third parties need to ensure there is no gap in skills in the not so distant future.

Apprenticeship programmes and early insights into the sector are going to be needed to ensure a steady supply of skilled employees is maintained so the market can continue to grow well into the future. Ensuring new, skilled, and talented individuals continue to be attracted to the Irish data centre market is key to its future success.