Thursday 29 September 2016

Alibaba scouts visit Ireland as tech firms mull €7bn data spend

Chinese online retailer is just one of a number of firms looking to set up shop here

John Reynolds

Published 07/08/2016 | 02:30

Last year Alibaba (which has a rapidly growing cloud computing division called Aliyun or AliCloud and is a potential rival to Amazon's Web Services division) announced it would invest €1bn in data centres. Photo: Reuters
Last year Alibaba (which has a rapidly growing cloud computing division called Aliyun or AliCloud and is a potential rival to Amazon's Web Services division) announced it would invest €1bn in data centres. Photo: Reuters

Chinese internet giant Alibaba has looked at the possibility of locating a data centre in Ireland, the Sunday Independent has learned, while it and other tech giants may invest up to €7bn in data centres here over the next decade, Eirgrid figures have revealed.

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Industry sources said representatives of Alibaba, an e-commerce site, where consumers can purchase everything from clothing to computer software, were in Ireland last month to look at potential locations for a data centre. They were looking both at city sites for a small installation and greenfield sites for a larger one here.

Data centres are the engines of the internet, our social media and email, and are vital to virtually every aspect of modern business. Essentially they are warehouses full of banks of computer servers. Companies can save tens of millions in operating costs here because the servers, which generate vast amounts of heat, are cheaper to cool in our climate.

A spokeswoman for Eirgrid, the State-owned company that manages Ireland's power grid, said: "There is approximately 550MW of data centres with either contracted capacity for connection to the power grid or engaging with us on the connection offer process. In addition, there is approximately 1,000MW of enquiries regarding further demand connections from 2019 onwards."

Industry sources suggested that it costs about €5m per megawatt of capacity to build a data centre. Building the 550MW it refers to would require investment in planning, design, site preparation, construction and equipment, of about €2.75bn, while the further 1,000MW of enquiries Eirgrid has would require about €5bn of investment if all of it was built.

"If all of these enquiries were to connect, the data centre load could account for 20pc of the all-island electricity system peak demand.

"The focus of interest has been the greater Dublin area. Depending on the scale of the projects that materialise, new transmission solutions may be required in order to facilitate these connections, and these are being investigated.

"The scale of individual demand connection enquiries to the transmission system vary from 20MW to some extending to 250MW in the final stages of development. The connections are mainly comprised of data centres that support the critical IT infrastructure of large multinational companies," the spokeswoman added.

Google, Microsoft and Amazon have between them invested almost €2bn in building data centres in west Dublin. Apple is awaiting the outcome of a planning application to build a data centre in Athenry, Co Galway, and Facebook plans to build one in Co Meath.

Last year Alibaba (which has a rapidly growing cloud computing division called Aliyun or AliCloud and is a potential rival to Amazon's Web Services division) announced it would invest €1bn in data centres. A spokeswoman for the company declined to comment.

Sunday Indo Business

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