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Minister issued direction on gas supply to data centres

Minister for Climate Eamon Ryan instructed the organisation which runs Ireland's natural gas network not to provide connections to data centres which are going to rely exclusively on gas for power.

The minister issued the direction in a letter to Gas Networks Ireland on 28 July.

It followed from similar instruction which stopped fossil-fuel powered data centres connecting to the electrical network two years ago.

However, it is understood Minister Ryan's instruction to prevent data centres connecting to the gas network has hit a legal impediment which may require a change in legislation.

There are a small number of data centres which are supplied exclusively by gas and there are a number of applications for similar developments.

But the Government has a concern that these applications could circumvent that State's prohibition on fossil fuel dependent data centres.

It could also cause the strain on the electricity network to spill over into the gas system.

Mr Ryan's letter, released to RTÉ News under Freedom of Information, followed a statement by the Government on data centres earlier this year.

In the policy paper it said that developments which were not connected to the electricity network and were powered mainly by on-site fossil fuel generation would not be in line with national policy.

The Government statement said that such centres would "run counter to emissions reduction objectives and would not serve the wider efficiency and decarbonisation of our energy system."

It said growth in data centres, which relied solely on gas instead of electricity, "could result in security of supply risk being transferred from electricity to gas supply, which would be a significant challenge given Ireland's reliance on gas importation."

Following the statement Minister Ryan wrote to Gas Networks Ireland CEO Cathal Marley and said that on the basis of the policy statement it would "not be appropriate" for the organisation to sign any more contracts to connect data centres where they were powered by on-site fossil fuel generation.

However, it is understood that Gas Networks Ireland responded the following month and indicated that it was mandated under the Gas Act to supply connections to third parties.

It is understood it has temporarily paused new connections while it consults with the Commission for the Regulation of Utilities and the Department of Energy.

The organisation believes that it could be open to a legal challenge were it to permanently halt connections of data centres to gas.

In order to facilitate the minister's request it would require a change in legislation.

In a statement to RTÉ News, Gas Networks Ireland said it had responded to Minister Ryan's letter to advise "we are assessing the Government's paper to establish the basis on which we implement the recommendations."

It added: "Gas Networks Ireland offers third party access to the national gas network in line with directions set by the Commission for Regulation of Utilities (CRU) in accordance with the Gas Act."

Speaking to RTÉ News today, Minister Ryan confirmed he had requested Gas Networks Ireland to stop new connections to fossil fuel dependent data centres.

He added: "I was concerned there could be further gas connections. I said we have to stop here and we have to say anything we do has to meet our climate targets and meets or energy security needs.

"I wanted make sure Gas Networks Ireland also knows that."

He added that "into the future any new data centres are going to be carbon zero."

He said a wide variety of data centre companies realised there is a restriction on getting connections.

"It is not a flat 'no'. We are saying we have to do this is a way that is sustainable."

He confirmed some data centres had been refused connections.

"We are working with all the companies to say we can't continue the way we are doing it. We will have to look a new ways of doing it. That may take time, that that may take a number of years to get our renewable supply in place and the grid in place."