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Alibaba visits Ireland to explore data center buy-in

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State electricity provider says spare capacity exists for $7.7bn worth of data center investment

Chinese e-commerce giant Alibaba has scouted out Ireland as a possible location for a new data center, the Irish Sunday Independent reports.

The company, which in April became the owner of the world’s largest retail platform, visited Ireland in July to investigate the possibility of building a facility in the Dublin area. It looked at urban Brownfield sites for development of smaller facilities and rural Greenfield locations for a larger-scale development.

An Alibaba spokeswoman declined to provide comment to The Independent.

Billion-dollar capacity

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Source: Grange Castle

Ireland hosts tech giants including Microsoft, which operates a data center at Grange Castle outside Dublin and has permission to build four more at the site

Ireland has become an increasingly attractive prospect for companies looking abroad to build a data center, with a cool climate, secure political environment, low corporate tax and a strategic location between North America and Western Europe.

State-owned utility provider Eirgrid said 550MW of power is either already contracted to data center operators or is the subject of negotiations to secure supply. In addition, various organizations have registered an interest in securing a combined total of an extra 1,000MW of energy for data centers beyond 2019.

Constructing facilities that would use 550MW of power would require investment of about €2.75 billion ($3.05 billion), said The Independent, citing industry sources who estimated that the standard cost of power in Ireland is €5 million ($5.5 million) per megawatt.

Investment of €5 billion ($5.5 billion) would be required to build sites with capacity to draw 1,000MW out of the power grid.

A spokeswoman for Eirgrid told the Independent: “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.

Alibaba announced in July 2015 that it would invest an extra $1 billion in a global expansion of its cloud computing division, to include data centers in Europe, Southeast Asia and the Middle East.

Host In Ireland, an initiative to encourage development of digital infrastructure in the country, said in 2015 it believed the presence of Internet giants such as Google, Facebook, Microsoft and Apple creates opportunities for smaller companies to buy up space in Irish colocation centers.

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