Can backup power make data centres cleaner?

Introduction

Ireland’s new rules for connecting large data centres to the electricity system are an attempt to solve a difficult problem: how to keep expanding digital and AI infrastructure without overwhelming a relatively small and already constrained grid. The solution chosen by regulators is unusual. Rather than simply refusing new projects, Ireland is increasingly requiring large data-centre operators to bring their own dispatchable power generation or storage alongside new grid connections.[cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.com]cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.comCRU2025236 Large Energy User connection policy decision paperLarge Energy Users Connection Policy12 Dec 2025 — The ability of the data centre applicant to bring onsite dispatchable generation (and/o…

That approach could reduce pressure on the grid and make it easier to accommodate growing AI computing demand. But it also creates a tension at the centre of Ireland’s climate debate. In practice, the easiest way to provide large amounts of dispatchable power today is often through gas-fired generation. Critics argue that rules designed to protect the electricity system may therefore encourage new fossil-fuel infrastructure just as Ireland is trying to cut emissions. Supporters counter that reliability constraints are real, and that large AI and cloud facilities cannot run solely on intermittent renewable power with current technology and market structures.[Friends of the Earth]friendsoftheearth.iecru decision on data centres runs roughshod over climate oblFriends of the EarthCRU decision on data centres runs roughshod over climate…11 Dec 2025 — CRU decision risks putting Ireland back in…[Prof. Hannah Daly]hannahdaly.ie2025 12 12 CRU data centre policyProf. Hannah DalyA new era of fossil fuels to facilitate data centres?12 Dec 2025 — The CRU's new decision on data centre connections is…

What the connection rules require

Ireland’s Commission for Regulation of Utilities (CRU) has moved away from the ad hoc restrictions that emerged during earlier grid-capacity concerns and towards a formal Large Energy Users Connection Policy aimed specifically at data centres. The policy applies to new data-centre connections and major expansions of existing facilities. [cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.com+2Eversheds Sutherland]

The central idea is that very large data centres should not simply add large new electricity demand to the system and expect the national grid to absorb it. Instead, operators are increasingly expected to demonstrate that they can support system adequacy themselves.

Key requirements include:

• Dispatchable generation or storage capable of matching a site’s maximum import capacity on a de-rated basis.
• Generation or storage that participates in Ireland’s electricity market rather than functioning solely as emergency backup.
• The possibility of locating generation on-site or near the data centre rather than directly inside the facility.
• Increasing expectations that operators procure substantial amounts of new renewable electricity, with policy discussions centring on an 80 per cent renewable matching requirement over time.[Arthur Cox LLP]arthurcox.comnew connection policy for data centres in irelandArthur Cox LLPNew connection policy for data centres in Ireland16 Dec 2025 — Large data centres must provide dispatchable onsite or proxi…[Lexology]lexology.comIreland's New CRU Large Energy User Connection Policy22 Dec 2025 — For data centres at or above 10 MVA, the CRU requires dispatchable ons…

The policy is designed around a governance principle that has become increasingly important in AI infrastructure debates: if a project creates a large new load, it should contribute to solving the energy challenge rather than relying entirely on public infrastructure upgrades.

This matters because Ireland’s grid is unusually exposed to concentrated data-centre demand. In a larger continental system, a single hyperscale facility might represent only a small fraction of overall consumption. In Ireland, clusters of data centres can have visible effects on capacity planning, network congestion, and security-of-supply calculations.[GridBeyond]gridbeyond.comCRU unveils limits on data centre usage amid supply worriesEirGrid estimates that by 2028, data centres could account for 29% o…

Why dispatchable power often means gas

The phrase “dispatchable generation” sounds technology-neutral, but current economics and engineering make some options much easier than others.

Dispatchable power means electricity that can be called upon when needed rather than only when weather conditions permit. Grid operators value it because it can respond to demand spikes, renewable fluctuations, or unexpected outages. For a large data centre running AI workloads, cloud services, or critical internet infrastructure, reliability requirements are extremely high. Downtime can be extraordinarily expensive.[Mason Hayes Curran]mhc.iecru sets out new rules for data centre connectionsMason Hayes CurranCRU Due to Set Out New Rules for Data Centre Connections29 Sept 2025 — Dispatchable generation: Applicants must provide…

The problem is that most renewable generation is not inherently dispatchable.

Natural-gas turbines, by contrast, are commercially mature, scalable, and capable of supplying power whenever required. For many developers, they are the most straightforward way to satisfy dispatchability requirements. That is why environmental groups argue that a formally technology-neutral rule may still create a practical bias towards fossil-fuel infrastructure.[CRU Consultation Portal]consult.cru.ieCRU Consultation PortalFriends of the Earth Response to CRU202504 4 April 20254 Apr 2025 — It is our position that a connection policy ap…[Prof. Hannah Daly]hannahdaly.ie2025 12 12 CRU data centre policyProf. Hannah DalyA new era of fossil fuels to facilitate data centres?12 Dec 2025 — The CRU's new decision on data centre connections is…

This is the core contradiction. Ireland is trying to reduce dependence on fossil fuels while simultaneously demanding reliability characteristics that fossil-fuel systems currently provide most easily.

Critics describe this as a hidden fossil subsidy embedded within grid policy. Supporters instead argue that the policy is exposing a physical reality often overlooked in public debate: electricity systems need reliable capacity as well as renewable energy production.

Why emergency diesel is not the main issue

Public discussion often focuses on diesel backup generators because most large data centres already have them. However, the new Irish framework is not primarily about traditional emergency generators.

Emergency diesel systems generally operate only during outages and maintenance testing. They are not designed to participate continuously in electricity markets or provide regular balancing services. The CRU framework instead pushes developers toward generation or storage assets that can actively contribute to system adequacy and wholesale market participation.[Mason Hayes Curran]mhc.iecru sets out new rules for data centre connectionsMason Hayes CurranCRU Due to Set Out New Rules for Data Centre Connections29 Sept 2025 — Dispatchable generation: Applicants must provide…[Arthur Cox LLP]arthurcox.comnew connection policy for data centres in irelandArthur Cox LLPNew connection policy for data centres in Ireland16 Dec 2025 — Large data centres must provide dispatchable onsite or proxi…

That distinction matters because it changes the scale of infrastructure involved.

A conventional emergency backup system might run for a few hours each year. A market-participating dispatchable asset could become part of the broader electricity system, generating electricity much more frequently. From a climate perspective, emissions consequences therefore depend heavily on which technologies developers choose.

Whether storage and renewables can close the gap

The most important long-term question is whether Ireland’s rules will accelerate cleaner alternatives or simply encourage more gas generation.

In principle, the policy allows developers to satisfy requirements through combinations of:

• Grid-scale batteries.
• On-site battery storage.[mhc.ie]mhc.ielarge energy users connection policyMason Hayes CurranLarge Energy Users Connection Policy20 Feb 2025 — The required generation or storage must be located on or near the dat…
• Renewable generation paired with storage.
• Flexible demand management.[lexology.com]lexology.comNew Irish Large Energy Users Connection Policy7 Jan 2026 — Ability to bring flexible demand onsite. Flexibility of the data centre's dema…
• Future low-carbon technologies such as hydrogen-fuelled generation.[cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.com]cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.comCRU2025236 Large Energy User connection policy decision paperLarge Energy Users Connection Policy12 Dec 2025 — The ability of the data centre applicant to bring onsite dispatchable generation (and/o…[Arthur]arthurcox.comnew connection policy for data centres in irelandArthur Cox LLPNew connection policy for data centres in Ireland16 Dec 2025 — Large data centres must provide dispatchable onsite or proxi…

The challenge is scale.

Large AI-oriented data centres increasingly require hundreds of megawatts of power. Batteries are effective for short-duration balancing and fast-response services, but storing enough energy to sustain a hyperscale facility through prolonged periods of low renewable output remains expensive. A few hours of storage is commercially plausible; many days is much harder.

This creates a mismatch between the ambitions of AI-driven digital expansion and the current capabilities of clean-energy infrastructure.

From an AI-bloom perspective, the issue is significant because abundant intelligence may ultimately depend on abundant energy. Optimistic visions of AI-enabled scientific acceleration, automated industry, advanced medicine, and large-scale computational research all assume access to vast quantities of reliable electricity. If compute becomes one of the defining inputs to future prosperity, energy constraints become a direct limit on how rapidly those benefits can scale.

The Irish case therefore functions as an early test of a broader question that many countries may face: can societies expand compute capacity quickly while simultaneously decarbonising the energy system, or will reliability concerns repeatedly push them back toward fossil fuels?

The legal and climate challenge

Environmental organisations have challenged the policy in court, arguing that it risks locking in additional fossil-gas infrastructure and conflicts with Ireland’s climate obligations. Friends of the Irish Environment, Friends of the Earth Ireland, and ClientEarth have all criticised the framework and pursued legal action against aspects of the decision-making process.[friendsoftheirishenvironment.org]friendsoftheirishenvironment.orgdata centre energy policy challenged amid ai infrastructure boomEnvironmental lawyers were today granted leave by the High Court in their…Read more…[RTE.ie]rte.ie1564681 data centre courtEnvironment groups seek to overturn data centre decision23 Mar 2026 — Three environmental groups will seek leave in the High Court to lod…

Their criticism is not simply that data centres use large amounts of electricity. Rather, it is that the connection framework may encourage a particular pathway for meeting that demand.

The concern has several layers:

• New gas infrastructure could remain in operation for decades.
• Emissions impacts may not be fully reflected in connection decisions.
• Carbon-budget compliance becomes harder if dispatchable capacity is primarily fossil-fuel based.
• Grid policies may effectively determine future emissions trajectories without being subjected to the same scrutiny as climate policy.[Friends of the Earth]friendsoftheearth.iecru decision on data centres runs roughshod over climate oblFriends of the EarthCRU decision on data centres runs roughshod over climate…11 Dec 2025 — CRU decision risks putting Ireland back in…[CRU Consultation]consult.cru.ieCRU Consultation PortalFriends of the Earth Response to CRU202504 4 April 20254 Apr 2025 — It is our position that a connection policy ap…

Supporters of the policy respond that refusing new connections does not eliminate demand for AI and cloud computing. Instead, it may simply move investment elsewhere while leaving unresolved questions about how future digital infrastructure should contribute to grid stability.

Ireland as an early warning for the AI era

The Irish dispute is often presented as a local planning and energy controversy. In reality, it is becoming a prototype for a wider governance problem.

Advanced AI systems require large-scale computing infrastructure. Large-scale computing infrastructure requires reliable power. As demand for AI training and inference grows, more jurisdictions may face versions of the same question Ireland is confronting now: should data-centre operators be required to bring their own generation, and if so, what kinds of generation should count?

The answer matters because different choices produce very different futures.

A gas-heavy pathway could support AI expansion while slowing climate progress. A storage-and-renewables pathway could align digital growth with decarbonisation but may require technological improvements, grid investment, and higher upfront costs. A restrictive pathway could protect climate targets in the short term but potentially limit the growth of computing capacity that many see as essential for future scientific and economic gains.

Ireland’s connection rules sit directly at that intersection. They are not simply technical regulations about substations and grid queues. They are an early attempt to define the energy bargain that may accompany the expansion of AI infrastructure: if societies want more computation, who provides the power, how clean must it be, and how much reliability can be demanded without returning to fossil fuels? [cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.com+2Prof. Hannah Daly]

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Endnotes

1. Source: cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.com
Title: CRU2025236 Large Energy User connection policy decision paper
Link:https://cruie-live-96ca64acab2247eca8a850a7e54b-5b34f62.divio-media.com/documents/CRU2025236_Large_Energy_User_connection_policy_decision_paper.pdf

2. Source: cru.ie
Title: new electricity connection policy for data centre
Link:https://www.cru.ie/about-us/news/new-electricity-connection-policy-for-data-centre/

3. Source: eversheds-sutherland.com
Title: cru decision paper published on large energy users connection policy
Link:https://www.eversheds-sutherland.com/en/ireland/insights/cru-decision-paper-published-on-large-energy-users-connection-policy

4. Source: arthurcox.com
Title: new connection policy for data centres in ireland
Link:https://www.arthurcox.com/knowledge/new-connection-policy-for-data-centres-in-ireland/

5. Source: lexology.com
Link:https://www.lexology.com/library/detail.aspx?g=b7d8515c-ce1c-4563-bde6-c3a3abf29469

6. Source: gridbeyond.com
Link:https://gridbeyond.com/cru-unveils-limits-on-data-centre-usage-amid-supply-worries/

7. Source: lexology.com
Link:https://www.lexology.com/library/detail.aspx?g=e0e7a90f-f7af-4b72-a537-9ebc4ddf8920

8. Source: consult.cru.ie
Link:https://consult.cru.ie/en/system/files/materials/200/294/CRU%20Consultation%20on%20Large%20Energy%20Users%20connection%20policy%20-%20Friends%20of%20the%20Earth%20Submission.pdf

9. Source: friendsoftheirishenvironment.org
Title: data centre energy policy challenged amid ai infrastructure boom
Link:https://www.friendsoftheirishenvironment.org/news-archive/data-centre-energy-policy-challenged-amid-ai-infrastructure-boom

10. Source: rte.ie
Title: 1564681 data centre court
Link:https://www.rte.ie/news/environment/2026/0323/1564681-data-centre-court/

11. Source: cru.org
Link:https://www.cru.org/

12. Source: lexology.com
Link:https://www.lexology.com/library/detail.aspx?g=78c7dbbe-741e-4053-81ff-261aaf3cd95e

13. Source: lexology.com
Link:https://www.lexology.com/library/detail.aspx?g=e73e6b8d-5d58-4a19-98d2-4c5e8fdb818c

14. Source: consult.cru.ie
Title: review large energy users connection policy
Link:https://consult.cru.ie/en/consultation/review-large-energy-users-connection-policy

15. Source: cru.ie
Link:https://www.cru.ie/about-us/news/the-cru-publishes-its-decision-on-new-electricity-connection-policy-for-data-centres/

16. Source: consult.cru.ie
Title: CRU202504 LEU Connection Policy Response
Link:https://consult.cru.ie/en/system/files/materials/200/321/CRU202504%20LEU%20Connection%20Policy%20Response.pdf

17. Source: consult.cru.ie
Link:https://consult.cru.ie/en/system/files/materials/200/304/CII%20LEU%20Submission%204th%20April%202025.pdf

18. Source: consult.cru.ie
Title: CRU202504 Arup IRL Response
Link:https://consult.cru.ie/en/system/files/materials/200/264/CRU202504-Arup%20IRL%20Response.pdf

19. Source: friendsoftheearth.ie
Title: cru decision on data centres runs roughshod over climate obl
Link:https://www.friendsoftheearth.ie/news/cru-decision-on-data-centres-runs-roughshod-over-climate-obl/

20. Source: hannahdaly.ie
Title: 2025 12 12 CRU data centre policy
Link:https://hannahdaly.ie/2025-12-12-CRU-data-centre-policy/

21. Source: mhc.ie
Title: cru sets out new rules for data centre connections
Link:https://www.mhc.ie/latest/insights/cru-sets-out-new-rules-for-data-centre-connections

22. Source: mhc.ie
Title: large energy users connection policy
Link:https://www.mhc.ie/latest/insights/large-energy-users-connection-policy

23. Source: Wikipedia
Link:https://en.wikipedia.org/wiki/Ireland

24. Source: ucc.ie
Link:https://www.ucc.ie/en/epmg/research/other/friendsoftheearth/

Additional References

25. Source: eirgrid.ie
Link:https://www.eirgrid.ie/industry/becoming-customer/generator-connections

26. Source: algoodbody.com
Link:https://www.algoodbody.com/insights-publications/data-centres-and-the-grid-how-recent-irish-policy-will-shape-the-sectordata-centres-and-the-grid-how-recent-irish-policy-will-shape-the-sector

27. Source: linkedin.com
Link:https://www.linkedin.com/posts/eversheds-sutherland-irl_cru2025236largeenergyuserconnectionpolicydecisionpaperpdf-activity-7405229350352285696-UqBe

28. Source: philiplee.ie
Link:https://www.philiplee.ie/re-balancing-the-digital-bargain-irelands-new-cru-large-energy-user-connection-policy/

29. Source: byrnewallaceshields.com
Title: leap forward in clarity for irelands data centre sector and large energy users
Link:https://www.byrnewallaceshields.com/news-and-recent-work/publications/leap-forward-in-clarity-for-irelands-data-centre-sector-and-large-energy-users.html

30. Source: wattcharger.com
Title: data centres use 32 of irelands electricity how to stop competing with them
Link:https://www.wattcharger.com/blog/data-centres-use-32-of-irelands-electricity-how-to-stop-competing-with-them

Published: December 2025

31. Source: eaireland.com
Title: cru proposed decision on data centre grid connections eai to seek clarity
Link:https://www.eaireland.com/cru-proposed-decision-on-data-centre-grid-connections-eai-to-seek-clarity/

32. Source: williamfry.com
Title: cru publishes long awaited final policy on data centre connections
Link:https://www.williamfry.com/knowledge/cru-publishes-long-awaited-final-policy-on-data-centre-connections/

33. Source: cms.eirgrid.ie
Title: Data Centre Connection Offer Process and Policy v2 July 2020
Link:https://cms.eirgrid.ie/sites/default/files/publications/Data-Centre-Connection-Offer-Process-and-Policy_v2_July-2020.pdf

Published: July 2020

34. Source: linkedin.com
Link:https://www.linkedin.com/pulse/irelands-new-large-energy-users-leu-connection-policy-updates-re24-miaac