Apple pulls the plug on its €850M data center project in Ireland over planning delays

Dark clouds have gathered and broken over Apple’s plans to build a data center in Ireland. Three years ago, Apple announced that it would invest $2 billion into building a pair of new, green data centers in Ireland and Denmark. But today, the iPhone giant confirmed that it was cancelling the first of those two projects, after too many delays in the approval process, which today appeared to be extending in a way that could go on for a long time to come.

“We’ve been operating in Ireland since 1980 and we’re proud of the many contributions we make to the economy and job creation.  In the last two years we’ve spent over €550 million with local companies and, all told, our investment and innovation supports more than 25,000 jobs up and down the country.  We’re deeply committed to our employees and customers in Ireland and are expanding our operations in Cork, with a new facility for our talented team there,” the company said in a statement provided to TechCrunch. “Several years ago we applied to build a data centre at Athenry. Despite our best efforts, delays in the approval process have forced us to make other plans and we will not be able to move forward with the data centre. While disappointing, this setback will not dampen our enthusiasm for future projects in Ireland as our business continues to grow.”

Apple had planned for the data center — which would cover 166,000 square metres — to go online in 2017.

(The first phase of the Danish center announced at the same time, incidentally, is nearly completed and Apple is now working on a second center in the country. We’ve confirmed with sources that this second center is not the “other plan” that Apple refers to in its statement above, meaning another data center announcement from Apple in the region may be coming.)

As originally conceived, the facility in Ireland was planned to be built on land previously used for growing and harvesting non-native trees. As part of its CSR in building the facility on that land, Apple also pledged to “restore native trees to Derrydonnell Forest,” as well as build an outdoor education space an a walking trail.

But within months of Apple announcing the project, issues started to arise around the potential environmental impact and what effect the building of the data center would have on the national electric grid. Initially, the Galway County Council asked for more details from Apple about how the data center would work.

Then, when Apple provided it and the council granted permission to build the center six months later, individual objections started to surface, including from a local environmental engineer called Allan Daly, who has become something of the public face of the opposition to the plans.

Daly’s main argument was that Apple’s data center, particularly at its fullest-possible size, would put too much strain on Ireland’s power grid, including in the building of them. Apple has maintained that its data centers are powered on renewables, that it gives back over time, and that it wouldn’t over-build.

Last October, Apple won a case in the Irish High Court that appeared to give the company the green light it needed to proceed with its plans. But from what we understand, there was still some uncertainty that lingered, because opposition could have still taken the case to the Supreme Court to appeal once again.

That continued uncertainty was the final straw for Apple. With no guaranteed end in sight, Apple finally made the choice to “move on”, as one source close to the situation told TechCrunch.

The whole case underscores some of the ongoing issues that apparently exist in Ireland over how data centers are planned and approved by local authorities.

“There is no disputing that Apple’s decision is very disappointing, particularly for Athenry and the West of Ireland,” Ireland’s Minister for Business and Enterprise Heather Humphreys said in a statement provided to Reuters.

There is talk of reforming that whole process, but that is not something Apple will get involved with at this point.

The company has had a rather complex relationship with the country.

Like many tech companies, Apple has made a lot of investment into operations based out of Ireland, including housing its European headquarters in Cork. But the country has also been the subject of a large tax debate, which has seen Apple just weeks ago finally settle on paying some €13 billion ($15.4 billion) in back taxes to Ireland starting this month, after the EU ruled that the existing tax scheme was illegal.

Ironically, Ireland was on Apple’s side in trying to resist the payment — perhaps in part because it all too well understands its relationship to the companies that subsequently pump hundreds of millions of euros in investment and jobs into their economies.

It’s odd timing, therefore, that we’d hear about Apple pulling out of the data center in Ireland now, although from what I’ve been told the two are very distinct, unrelated issues.