Ireland Is Trying to Get Back on the Data Center Bandwagon

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(Bloomberg) — Every few weeks, electricians, fitters and welders pass through Dublin Airport to get flights to construction projects for data centers across Europe.

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They’re part of a cohort of Irish workers in high demand for their expertise in building and fitting out facilities. Their employer, Kirby Group, earned its reputation thanks to the massive investment in Ireland by the likes of Microsoft Corp., Amazon.com Inc. and Alphabet Inc.’s Google that turned the country into a major data center hub, one of Europe’s biggest.

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The artificial intelligence race means Ireland should again be an investment winner, leveraging its longstanding relationships with US firms to bring in more money.

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Instead, it’s missed out on much of the data center boom as creaking infrastructure and a strained electricity grid put the brakes on projects. Companies have scrapped plans — or have been blocked by authorities — and officials estimate some €10 billion ($11.7 billion) of investment has been lost because of constraints.

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Ireland’s past success at luring the world’s biggest names in tech and pharma turned it into one of the richest countries in the world. If overseas companies start to turn away, the damage would be huge.

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Aware of the risks, the government is making a fresh push to get back on the data center bandwagon. It has outlined plans for special business parks where energy-devouring projects can have easy access to clean power, balancing energy constraints with the need to stay attractive for investment. The move follows a decision by the energy regulator on new rules for electricity grid connections after a long-running review that left businesses in limbo for four years.

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“We risk missing an enormous wave of European AI and cloud investment,” Niall Molloy, chief executive officer of Echelon Data Centers, which operates facilities in multiple countries, said after the regulator’s announcement last month. “If they can’t locate in Ireland, we are running the risk of major problems in our foreign direct investment and our tax strategy.”

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The country is already living under the cloud of Donald Trump’s “America First” agenda and worries that the policy will damage investment. While the concern has so far proven unfounded, the uncertainty remains, meaning Ireland can ill afford to give businesses reason to have additional doubts.

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It’s an especially pressing issue because of the economic risks. Foreign-owned multinationals drive growth, employ more than 600,000 people and are the main reason the government can run annual budget surpluses. Those companies accounted for almost 90% of corporate tax income in 2024.

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The US government has taken note of the infrastructure squeeze. Last year, officials said that American companies see issues like energy constraints as a “major barrier to growth and further investment.”