Amazon sets up electricity unit in Dublin as it plans $1bn data centre

Web services is the most profitable unit – with €12.2bn sales last year – for Amazon CEO Jeff Bezos. Photo: Bloomberg

John Mulligan

Internet giant Amazon is establishing an electricity trading unit in Dublin as it continues to expand its footprint in Ireland and plans a €1bn data centre complex in the capital.

It's not clear what type of electricity trading the Amazon Web Services unit, called Amazon Energy Eoraip, will engage in, but it's clearly linked to the large electricity consumption of its data centres.

The scale of power usage by data centres has become a bone of contention for objectors to plans by both Amazon and Apple for huge data centre campuses in Ireland.

Companies have favoured Ireland for data centres because the temperate climate helps to lower running costs by aiding cooling of the buildings.

Earlier this year, Amazon submitted plans to Fingal County Council to build the first phase of what could be a €1bn data centre campus in Dublin. Amazon already has about 10 large data centres in the capital.

One objector to the Amazon plan, Allan Daly, told the council that Amazon has not specified precisely how much electricity the campus would require.

He said it should not be granted permission until an assessment of Ireland's renewable energy framework, currently being undertaken by the Department of Communications, Climate Action and Environment, is completed.

Mr Daly also objected to the Apple data centre plan.

Amazon, headed by founder and chief executive Jeff Bezos, has told Fingal County Council that its Dublin campus would be powered entirely by renewable energy.

But another objector to the campus has claimed that the entire data centre complex could use as much energy as all the households in all the Dublin council areas combined.

Fingal County Council approved the first phase of the Amazon plan, but it has been appealed to An Bord Pleanála.

The ESB has also recently voiced concerns that if all the data centres planned for Ireland are constructed it would pose a challenge for the electricity network.

A typical data centre can use as much electricity as would be required to power as many as 5,000 homes.

But Amazon claims that as companies transfer data activity to the cloud and data centres, overall power usage and carbon emissions decline.

It says that large data centres are more efficient that having many companies operating their own on-site mini-data centres and servers.

Amazon Web Services has extensive data centre operations here, servicing hundreds of thousands of clients that use its cloud capabilities to conduct their own business with clients, as well as backing up critical data off site.

Amazon's Web Services unit is the group's most profitable business.

It generated net sales of $12.2bn last year, and operating income of $3.1bn.

As a group, Amazon posted net sales of $135.9bn and operating income of $4.2bn.

Amazon Web Services has a long-term commitment to achieve 100pc renewable energy usage for its global infrastructure footprint.

It aims to have 50pc of its power sourced from renewable energy by the end of this year.

Ireland plays host to a large number of data centres. Facebook is currently building a huge €200m facility in Clonee, Co Meath.

Google, Mircosoft and other companies have a number of data centres based around the capital.