CRU issues decision on private wire connections for Irish data centres

The Commission for Regulation of Utilities (CRU) published its long-awaited decision paper on 12 December 2025, addressing connection policy for large energy users (LEUs), with a particular focus on data centres and the use of private wire connections. This decision follows ongoing concerns about grid capacity in the Republic of Ireland as well as power availability, energy security, and the overall regulatory framework for alternative energy arrangements.

Key points from the decision paper

Grid connection policy

The CRU continues to restrict new grid connections for data centres in areas with limited electricity supply, especially around Dublin. New applications must meet strict criteria regarding location, ability to provide on-site generation or flexibility and contribution to system stability.

Private wire

The CRU clarifies that private wire connections, being direct links between generators and data centres that bypass the public grid, are permitted but subject to a comprehensive regulatory framework. Operators will have to comply with licensing requirements and market rules to ensure transparency and to protect the integrity of the national grid.

Market participation

Data centres using private wire must still participate in the all-island Single Electricity Market (SEM) where applicable; and must not undermine grid revenue or planning.

Climate and security objectives

The LEUs’ policy aims to balance Ireland’s climate targets, security of supply, and economic development, with particular emphasis on the role of data centres as large energy consumers.

Implications for data centres

1. Connection challenges

Data centres will continue to face significant hurdles in securing grid connections, particularly in high- demand regions. New projects must demonstrate their ability to support grid stability and meet stringent technical and locational criteria.

2. Private wire opportunities and limitations

Private wire offers an alternative for data centres unable to connect directly to the grid. However, these arrangements are tightly regulated to prevent negative impacts on the national electricity system. Data centres must obtain appropriate licences and ensure compliance with market rules, which may increase administrative and operational complexity.

3. Regulatory certainty and risk

The decision provides greater clarity on the regulatory treatment of private wire, reducing uncertainty for developers. However, the strict oversight and requirement to participate in the SEM may limit the attractiveness of private wire solutions.

4. Impact on investment and growth

The combination of grid connection restrictions and regulated private wire arrangements may deter investment in new data centre capacity, particularly in constrained regions. Data centre developers may also need to invest in on-site generation, energy storage, or flexibility services to meet connection criteria. This will significantly impact developers in terms of the financial modelling and feasibility of new projects, when compared with projects which have previously been able to secure more conventional connections to the national grid.

Conclusion

The CRU’s decision paper reinforces Ireland’s cautious approach to data centre energy connections, prioritising grid stability and climate objectives. While private wire is permitted, it will be subject to robust regulation, and data centres must continue to engage with the national electricity market.

Developers should carefully assess this landscape when planning new facilities or considering private wire solutions. More widely, ongoing regulatory clarity and stakeholder engagement will be essential to balance national energy security, economic development, and climate objectives.

At Browne Jacobson, we have in depth experience with private wire solutions, with members of our team having advised on this for similar projects based in the UK where they have been around for several years.

If you require advice on this, our Irish data centres team would be more than happy to assist. Please contact Paul Tohill.