Energy regulator urged to scrap data centre policy following Supreme Court's wind farm ruling

THE REGULATOR FOR utilities has been urged to “go back to the drawing board” on its policy on data centre expansion following a Supreme Court ruling today.

Sinn Féin MEP Lynn Boylan put forward that the Commission for the Regulation of Utilities (CRU) needs to revise the measures to ensure it complies with the Climate Act in light of today’s ruling on a proposed wind farm in Co Laois.

The court partially upheld a significant High Court decision in favour of climate action in the case of the wind farm plan, called Coolglass.

The Supreme Court ruled that An Coimisiún Pleanála had failed in its obligations to consider whether planning permission should be granted for the wind farm even though this contravened the County Development Plan, particularly having regards to its duty under section 15 of the Climate Act.

The case could inform future decision-making on projects with climate implications, including energy projects, data centres and the government’s proposed liquefied natural gas (LNG) terminal.

Impact of Coolglass ruling

Because it revolves around the interpretation of the 2021 Climate Action and Low Carbon (Amendment) Act, Sinn Féin MEP Boylan said that today’s ruling leaves the existing data centre policy “legally untenable”.

The Climate Action Act provides the legal framework for Ireland to meet its climate commitments, including net-zero carbon emissions no later than 2050 and to a 51% reduction in emissions by 2030.

In December, the CRU said that the Climate Action Act does “not provide a sufficient legal basis to allow” it to “explicitly mandate specific emissions reduction and offsetting measures” when considering connections for new data centres.

But Boylan said the CRU will need to heed today’s ruling, as she accused it of kowtowing to “energy-hungry multinationals”.

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She added that its recent December decision was seen as “reopening the floodgates” to data centres in a way that will drive up electricity demand, increase reliance on fossil fuels and make legally binding climate targets harder to reach.

“The CRU refused to set a policy that would help keep the state within its climate limits. Its justification was that the Climate Act does not give it the legal powers to do so,” the Dublin MEP said.

Boylan said the CRU was focusing too much on the climate implications of renewable energy generation, and not considering the climate impact of rising electricity demand.

“That position was never legally tenable and today’s ruling makes that clear,” she added.

The Supreme Court reaffirmed that regulators like the CRU are bound by the Climate Act. The CRU has a legal duty to exercise its powers in a way that is consistent with our carbon budgets and climate action plans. Climate law is not optional and it is not somebody else’s job.

Data centre expansion

Electricity demand from data centres has grown from 5% of national electricity demand in 2015 to 22% in 2024.

The Government also recently revealed plans to ramp up the construction of more data centres across the country.

Boylan said she believes the CRU has tried to “hide behind narrow and flimsy interpretations of its role”, but that today’s ruling means regulator has a legal duty to align its connection decisions with our carbon budgets and climate action plans in future.

“Its decisions to allow data centres shape electricity demand and emissions for decades,” Boylan said.

“That places it squarely inside the climate framework, whether it likes it or not.

They could just say no to data centres which are not consistent with the climate obligations. But the possibility of saying no to big tech is never even entertained.

For more on today’s ruling and how the Supreme Court’s decision may also soften the potential implications of the case, read more here.

With reporting by Valerie Flynn

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