Ireland’s energy infrastructure is at a decisive juncture. A rapidly growing economy—driven by energy-intensive industries such as data centres, manufacturing and life sciences—demands an unprecedented expansion in power supply. However, constraints in grid capacity, continued reliance on fossil fuels and protracted planning processes threaten to undermine the country’s dual ambitions for both economic growth and sustainability. To secure its energy future, Ireland must act decisively—modernising its grid, accelerating renewable energy adoption and ensuring regulatory frameworks facilitate investment and innovation.
Addressing Ireland’s evolving energy landscape requires a nuanced approach—one that balances legacy systems with emerging sustainable solutions. Gardiner & Theobald (G&T) brings broad experience across the energy spectrum, from traditional fossil fuels and nuclear to renewable technologies. With a background in delivering complex, large-scale projects, G&T’s Major Projects & Infrastructure division brings together specialists who navigate the planning and development challenges these initiatives demand. This depth of expertise allows G&T to play a considered role in supporting Ireland’s transition toward a more resilient and sustainable energy future.
Energy Demand & Infrastructure Constraints
Ireland’s electricity demand has risen sharply over the past decade, driven primarily by data centres, the electrification of heating and transport and industrial growth.[1] In 2023, data centres alone accounted for more than one-fifth (20.1%) of total electricity demand[2], a share projected to approach 30% by 2030[3]. Despite grid constraints, Ireland has become a key destination for data centre investment due to its favourable tax environment, direct transatlantic connectivity and established tech ecosystem, which continues to attract major global operators. The growth of data centre demand, coupled with projected increases in electric vehicles and heat pump adoption later this decade, is expected to intensify pressures on an already stretched grid.
Ireland Median Demand: Total Electricity Requirement Sectoral Breakdown
Source: Eirgrid
Ireland’s electricity infrastructure is struggling to keep pace with rising demand. Supply constraints, an ageing transmission network and delays in grid upgrades risk deterring investment and slowing economic growth. These issues are already leading to energy shortages, price volatility and growing concerns over economic competitiveness.
High electricity costs further exacerbate the problem. Ireland has some of the highest electricity prices in Europe, largely due to its reliance on imported fossil fuels. In 2023, natural gas accounted for 44.3% of the country’s gross electricity supply[4], exposing businesses and consumers to the volatility of global energy markets. Without a significant expansion of domestic renewable capacity and greater grid resilience, Ireland risks becoming less attractive to energy-intensive industries.
Additionally, the Irish transmission system is struggling to keep pace with demand growth. EirGrid’s capacity constraints have already resulted in warnings about potential electricity shortages, with certain regions facing a heightened risk of blackouts during peak periods. This is particularly concerning given the country’s ambitions to remain a hub for multinational investment. Persistent grid reliability issues may prompt businesses to reconsider Ireland as a base for operations, opting instead for locations with more stable and cost-effective energy supplies.
Grid Modernisation & Renewable Energy
A fundamental shift toward renewable energy is essential for Ireland to meet its climate targets, enhance its energy security and foster sustainable economic growth. Wind energy already plays a significant role, contributing over 32% of the country’s electricity generation in 2024.[5] However, limitations in grid infrastructure and storage capacity have led to curtailment—where excess wind power goes unused due to an inability to transmit or store it effectively. This inefficiency is both financially costly and environmentally counterproductive, as it prevents Ireland from fully harnessing its renewable potential. Consumers ultimately bear the cost, not only through the initial investment in wind infrastructure but also through curtailment payments to wind farms and the need for additional power generation elsewhere due to grid constraints.
To overcome these challenges, Ireland is accelerating investment in grid modernisation, battery storage and offshore wind capacity.[6] The government has set an ambitious target of generating 80% of electricity from renewables by 2030[7], with offshore wind expected to be a key pillar in achieving this goal. Yet, progress has been slow compared to European peers. While countries like Denmark and the UK have successfully scaled up offshore wind, Ireland's projects remain largely in the planning stage—hindered by regulatory bottlenecks and planning constraints.
These other nations have also faced similar challenges but have navigated them through more streamlined permitting processes, more transparent regulatory frameworks and early-stage investment in transmission infrastructure. Denmark, for example, established a centralised approach to offshore wind development, reducing uncertainty for investors. At the same time, the UK’s Contracts for Difference (CfD) scheme has provided long-term revenue stability for developers. Ireland could benefit from adopting similar strategies to accelerate project timelines and unlock its full offshore wind potential, reducing reliance on fossil fuels.
The Role of Interconnectors
Interconnectors are a crucial component of Ireland’s energy strategy, enhancing energy security, balancing supply and demand and improving market integration. The Celtic Interconnector—a 700 MW electricity link between Ireland and France—will provide direct access to the European electricity market, reducing dependence on UK imports while enabling the export of surplus renewable energy.[8] Existing interconnectors, such as the East-West Interconnector (Ireland–UK, 500 MW), the Moyle Interconnector (Northern Ireland–Scotland, 500 MW) and the recently commissioned Greenlink Interconnector (Ireland-Wales, 500 MW), already play a role in stabilising supply and improving grid flexibility.
However, interconnectors alone cannot resolve Ireland’s domestic grid constraints. While exporting excess wind power is beneficial, internal transmission limitations—especially in high-renewable-generation regions such as the west coast—remain a significant barrier to optimising energy distribution. Without substantial upgrades, bottlenecks will persist, limiting the full potential of Ireland’s renewable energy capacity.
G&T is actively involved in supporting major UK and European developers with HVDC links and interconnector projects across both private and regulated sectors. Our expertise spans the entire interconnector project lifecycle, from early development to project closure. We have assisted clients at every stage, including:
- Project Development: Supporting multiple private equity firms in connecting the UK to European energy markets.
- Procurement and Regulatory Approvals: Facilitating key projects like Eastern Green Link 1 to 4, connecting Scotland and England.
- Delivery: Contributing to the successful execution of NeuConnect, a landmark interconnector between England and Germany.
- Final Account and Project Closure: Overseeing the completion of IFA2, linking England and France.
Discover more about why we need interconnectors—and how G&T is at the forefront of the market, helping clients deliver these vital projects. Our latest article looks at how interconnectors are rapidly becoming the backbone of global energy markets.
Strengthening Ireland’s Internal Grid
To maximise the benefits of its renewable resources, Ireland must go beyond interconnectors and focus on strengthening its internal grid. Key priorities include:
- Transmission Network Expansion – Upgrading and expanding the grid to ensure efficient distribution of wind-generated electricity from high-output coastal regions to demand centres.
- Grid Flexibility & Smart Technologies – Implementing smart grids, dynamic line rating, and real-time monitoring to optimise performance, improve load balancing and minimise curtailment.
- Battery Storage & Demand Response – Investing in large-scale energy storage to capture excess renewable energy for use during peak demand, improving grid stability and efficiency.
Failure to accelerate these critical upgrades risks undermining Ireland’s 2030 renewable targets, prolong curtailment issues, and deter energy-intensive industries reliant on a stable, low-cost power supply. However, delivering these improvements within the 2030 timeframe will be challenging, given the scale of investment, planning requirements, and supply chain constraints. While progress is being made, the long lead times for major transmission projects mean some elements may extend beyond 2030. If timelines slip, interim measures—such as optimising existing grid infrastructure, leveraging interconnectors, or maintaining limited conventional generation—may be necessary to safeguard energy security while continuing the transition to renewables.
Policy & Investment: Unlocking the Energy Transition
Government policy will play a crucial role in shaping Ireland’s energy future. Recent initiatives, such as the Renewable Electricity Support Scheme (RESS)[9], have provided a boost for wind and solar projects by offering long-term price certainty to investors. However, challenges persist in securing private sector financing at the scale required to modernise infrastructure and integrate renewables effectively.
Addressing Planning & Regulatory Bottlenecks
One of the most significant barriers to energy infrastructure development in Ireland is the slow and complex planning approval process. Lengthy timelines for securing permits hold up the rollout of renewable projects, grid upgrades and energy storage solutions. To accelerate progress, regulatory reforms should focus on fast-tracking strategic energy projects, introducing streamlined approval pathways for projects deemed critical to energy security and net-zero ambitions.
By setting binding deadlines for planning applications and environmental assessments, uncertainty can be reduced, while risk-sharing mechanisms—such as public-private financing models—can boost investor confidence. Furthermore, embracing automation and AI-driven permitting systems offers the promise of improved efficiency and transparency.
These reforms, combined with greater collaboration between government agencies and industry stakeholders, will be essential in unlocking much-needed infrastructure investment.
Expanding Interconnection & Energy Security
Investment in cross-border interconnectors will play a key role in stabilising Ireland’s electricity supply and mitigating exposure to market volatility. The Celtic Interconnector (700 MW), set for completion in 2027, will strengthen Ireland’s ability to trade renewable energy with mainland Europe, reducing reliance on UK imports and improving system resilience. The planned LirlC Interconnector (700 MW) between Northern Ireland and Scotland – which has received support from both UK and Irish regulators – will provide additional capacity between the Irish Integrated Single Energy Market (I-SEM) and the GB wholesale electricity market.
Beyond interconnectors, green hydrogen and advanced energy storage solutions are gaining traction as complementary technologies to mitigate the intermittency of renewables. However, these solutions are likely to have a more significant impact in the longer term, as technological advancements, cost reductions and infrastructure scaling will take time. In the near term, strengthening grid capacity, accelerating interconnection, and improving demand-side flexibility will be more immediately effective in ensuring energy security and optimising renewable generation. Nonetheless, sustained investment in hydrogen and storage remains essential to Ireland’s long-term decarbonisation strategy.
Case Study: Producing green energy from organic materials Future Biogas | Gardiner & Theobald
Strengthening Demand-Side Management (DSM)
One area that remains underdeveloped is demand-side management (DSM), which leverages smart grid technologies—such as digital sensors, advanced metering, and IoT devices—alongside dynamic pricing structures like time-of-use tariffs to optimise electricity usage and shift consumption away from peak periods. By encouraging businesses and households to adopt energy efficiency measures and flexible consumption patterns, DSM can significantly reduce grid strain and mitigate supply constraints. However, while DSM enhances efficiency and alleviates pressure on existing infrastructure, it is not a substitute for large-scale grid upgrades. A balanced approach—combining DSM with strategic investments in transmission expansion, storage capacity, and renewable integration—will be essential to ensuring a resilient and future-proof energy system
Future-Proofing the Grid
Ensuring that Ireland’s energy infrastructure meets long-term needs requires forward-thinking strategies, including:
- Expanding grid capacity: Upgrades to transmission networks are essential to accommodate rising electricity demand and integrate new renewable energy sources.
- Enhancing storage solutions: Large-scale battery storage and pumped hydro projects can mitigate intermittency issues associated with wind and solar power.
- Investing in digitalisation: Adopting smart grid technologies can optimise energy distribution, improve efficiency, and provide real-time demand response capabilities.
- Reforming planning frameworks: Faster approval processes for renewable projects and infrastructure upgrades are vital to achieving ambitious energy targets.
Furthermore, policymakers must consider the long-term impacts of continued energy demand growth from data centres. While these facilities provide significant economic benefits, their substantial power consumption raises questions about sustainable development. Some industry experts argue that stricter regulations on data centre energy efficiency and location selection could help balance the benefits with grid stability.
With a coordinated approach that marries strategic investment, regulatory reforms, and a decisive push towards renewables, Ireland has the potential to build an energy system that is both resilient and a catalyst for economic growth. The pace of implementation, however, is crucial—any delays risk undermining both environmental and economic ambitions.
Case Study: Transmitting power from Scottish wind farms Western Link HVDC | Gardiner & Theobald
Conclusion
Ireland’s energy infrastructure is at a decisive juncture. Surging demand, grid constraints and the transition away from fossil fuels compel a coordinated and forward-thinking response. While investments in renewables, storage, and interconnectors will be critical, they must be matched by ambitious policy reforms and targeted infrastructure upgrades to ensure reliability and affordability. Demand-side management and smart grid technologies offer immediate efficiency gains, but they are not a substitute for large-scale capacity expansion. The challenge is clear: without decisive action, Ireland risks falling behind in both economic competitiveness and sustainability. A strategic, long-term vision—backed by investment, innovation, and regulatory clarity—will be essential to building an energy system that is resilient, future-proof and capable of sustaining Ireland’s growth ambitions.
To navigate these complexities, G&T brings deep expertise in energy infrastructure delivery, helping clients manage risk, optimise investment, and drive efficiency in large-scale projects. From grid modernisation and renewables integration to securing supply for energy-intensive industries, G&T’s experience in major infrastructure projects ensures strategic, cost-effective solutions. As Ireland embarks on this critical transition, our team stands ready to support stakeholders in delivering the resilient, future-proof energy system the country needs.
Up next…
Our next article in the series delves into Ireland’s data centre market as the country strives to strengthen its position as a leading data centre hub. We will examine the key challenges hindering future expansion, including energy constraints, regulatory hurdles and infrastructure limitations. While targeted investments in green energy and grid modernisation can help address these obstacles, the pace of demand growth raises concerns about whether sustainability targets can be met. In the absence of sufficient renewable capacity, there is a risk that conventional power generation may be relied upon to bridge the gap, potentially undermining Ireland’s decarbonisation goals. Balancing energy security with sustainability will be critical in shaping the sector’s future.
References
[1] https://www.seai.ie/sites/default/files/publications/energy-in-ireland-2024.pdf
[2] Ibid
[3] https://cms.eirgrid.ie/sites/default/files/publications/19035-EirGrid-Generation-Capacity-Statement-Combined-2023-V5-Jan-2024.pdf
[4] https://www.seai.ie/sites/default/files/publications/energy-in-ireland-2024.pdf
[5] https://windenergyireland.com/latest-news/7827-irish-wind-farms-provide-a-third-of-our-power-in-2024-and-set-new-energy-milestone
[6] For example, Poolbeg Battery Energy Storage System, Kylemore Battery Energy Storage System, and Gorman Battery System
[7] https://www.seai.ie/about/irelands-energy-targets
[8] https://www.eirgrid.ie/celticinterconnector
[9] https://www.eirgrid.ie/industry/renewable-electricity-support-scheme-ress
