Ireland’s data centre debate often focuses on power use, but a new government-backed analysis makes a wider economic case for the sector. Published on gov.ie by the Department of Enterprise, Tourism and Employment, the report says data centres are now a core part of the country’s digital backbone, supporting jobs, investment and the wider Irish economy.
The independent KPMG study, released by Minister Peter Burke, examines how data centres contribute not only through construction and operations, but by enabling activity across cloud computing, artificial intelligence, finance, healthcare and public services. For businesses, policymakers and agencies such as IDA Ireland, Enterprise Ireland and the Revenue Commissioners, the findings reinforce how closely digital infrastructure is tied to national competitiveness.
Data centres and Ireland’s digital economy
The report finds that data centres support economic activity across sectors that depend heavily on secure, high-performance digital infrastructure. According to the analysis, these sectors account for more than €100 billion in annual Gross Value Added, support 875,000 jobs and generate €14.6 billion in annual employment-related taxes.
In direct terms, the construction and operation of data centres in 2024 accounted for:
- €2.2 billion in Gross Value Added
- 19,500 jobs
- €280 million in employment-related tax
This matters beyond the technology industry. The Health Service Executive (HSE), Finance services, public administration, online retail and professional services all depend on reliable data storage and processing capacity. The report also aligns with wider digital ambitions across government, including work linked to the Department of the Taoiseach, Public Expenditure, Education and Further and Higher Education.
Why the sector matters for investment
The report argues that data centres remain essential to attracting multinational firms to Ireland. Reliable digital infrastructure is increasingly seen as a deciding factor for companies choosing where to locate operations, particularly those involved in AI, cloud services and data-heavy enterprise activity. That is relevant not just for gov.ie policy, but for bodies including the Central Bank, CSO, National Treasury Management Agency (NTMA) and regulators handling the data-driven economy.
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High-tech construction exports and regional opportunity
One of the more notable findings is the knock-on effect on Ireland’s high-tech construction industry. The study estimates that €2.1 billion in high-tech construction exports in 2024, roughly 40% of exports from Irish-owned firms in that segment, were linked to data centre activity.
That suggests the sector is helping Irish companies build specialist expertise with global demand. It also supports the government view that digital infrastructure can contribute to regional development if future projects are planned in a more balanced way with Transport, Housing, Local Government and Heritage, and Climate Action priorities in mind.
Balancing growth with energy and climate goals
While the economic case is strong, the report does not ignore the main concern: electricity demand. It notes that, unlike some European countries with heavy industrial bases, Ireland’s energy-intensive activity is concentrated more heavily in the digital economy.
To address this, the government is linking future growth to sustainability rules under the Large Energy User Action Plan. Minister Burke said new data centres will be expected to provide onsite or nearby electricity generation, with 80% of that supply coming from renewable sources. This plan-led approach is intended to support energy security, grid management and climate targets while still allowing the digital economy to expand.
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What this means for public policy
The report positions data centres as enabling infrastructure rather than a standalone industry. That means future decisions could increasingly involve multiple state bodies, from the Environmental Protection Agency (EPA) and Commission for Regulation of Utilities (CRU) to An Bord Pleanála, Tailte Éireann and the Office of Public Works (OPW), depending on planning, environmental and infrastructure needs.
Conclusion
The new gov.ie report makes the case that data centres are central to Ireland’s economic model, digital transformation and future AI ambitions. The key takeaway is clear: continued growth in data centres is likely to remain a strategic priority, but only where expansion is managed carefully to align with energy, sustainability and long-term national competitiveness goals.
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Article/Image Courtesy: gov.ie
