- By Charles Miller
Ireland offers a glimpse into the physical appetite of the digital world. In 2015, data centres in Ireland used about five per cent of the nation’s electricity.
By 2023, that share had leapt to 21 per cent with strong investment from global IT, and in 2024 more than one-fifth of all power was consumed by data centres alone – more than consumed by all Irish homes combined.
The United Kingdom sits at around two per cent today, while in the United States it’s closer to four or five per cent.
Finland, Denmark, and Sweden remain below two per cent but are rising fast as hyperscale operators seek cooler climates and renewable grids.
Add to that the demand for water. Each large AI data centre uses millions of litres annually for cooling.
Training and running large models consumes significant water indirectly through electricity generation and directly via evaporative cooling systems. AI, for all its virtual value, is remarkably thirsty.
In 2000, global spending on telecommunications switching, early data centres, and fibre networks was perhaps USD$40 billion.
Today, the physical internet, including data centres, undersea and terrestrial fibre, satellite networks, and industrial infrastructure, requires hundreds of billions every year.
McKinsey estimates cumulative investment of USD$6.7 trillion will be required by 2030 to sustain global digital growth.
Spending on submarine cable projects alone will exceed USD$13 billion between 2025 and 2027, and global data-centre capital expenditure now surpasses USD$430 billion annually.
The reality of the internet is that every byte travels through a chain of tangible assets – semiconductors, routers, power transformers, pumps, chillers, and kilometres of copper and fibre. The “cloud” is built from concrete, steel, and silicon.
New Zealand is beginning to take its place in this landscape. Our total data-centre investment is currently valued at about USD$800m, forecast to grow to USD$1.4b by 2030.
Amazon Web Services alone has announced a NZD$7.5b regional build – three large campuses including power, cooling, and security infrastructure. National capacity could reach almost 400 megawatts by 2030.
For New Zealand businesses, this sector represents a real opportunity. Electricians, refrigeration and HVAC specialists, automation engineers, network installers, ‘IoT’ – the internet of things – integrators and construction firms all have roles in the physical infrastructure of the digital economy.
AI and the internet are not floating somewhere above us. They’re grounded in substations, cables, and cooling plants.
The next wave of digital growth will be won not only by coders and analysts, but by those who build and maintain the systems that make the virtual world real. AI and the internet are not up in the clouds. They’re very much down to earth. Seize the opportunity.
