Excess heat from data centres, geothermal sources and industry could be converted into district heating for neighbourhoods all over Ireland, according to a new joint project launched by the government together with the EU.

More than 80 percent of Irish household currently use fossil fuel – mainly oil and gas – for heating homes.

Now the European Investment Bank (EIB) has agreed to share best practice from across the EU to help Ireland develop new renewable and zero-emission sources of heating.

The EIB will work with the Sustainable Energy Authority of Ireland (SEAI) as the key partner in the project.

District heating schemes make use of excess waste heat from industry. Successful projects can cut energy bills by one-third, according to one estimate.

Ireland’s ever-expanding data centres produce huge amounts of heat. With the right technology, that heat could be redirected into water pipes for nearby homes and schools, according to experts.

The Tallaght District Heating Scheme in Dublin is the first large-scale district heating network in Ireland and it is doing just that, making use of heat generated by a nearby Amazon data warehouse.

The scheme run by South Dublin County Council provides heat to university buildings, the library, county hall and residential apartment blocks.

The government believes many more schemes like this could be rolled out across the country.

“District heating has huge potential for Ireland’s clean energy transition”, said Darragh O’Brien TD, Minister for Transport and Minister for Climate, Energy and the Environment.

“Through this collaboration with the EIB and SEAI’s Centre of Excellence, we will prepare a strong pipeline of community-based projects that not only reduce our carbon footprint but deliver tangible cost savings for Irish families and employers.

This initiative will also support local job creation and skills development in the renewable energy sector, strengthening communities across the country. By investing in sustainable heating infrastructure today, we are laying the foundation for a more resilient, energy-secure Ireland for future generations.”

Getting these projects off the ground costs money and that’s where European Investment Bank support could be crucial.

It provides low-interest loans to governments and local authorities across Europe. And green projects are a priority.

“The EIB is proud to bring its European experience in sustainable energy systems to Ireland”, said EIB Vice President Ioannis Tsakiris.

“District heating can cut emissions, reduce fuel poverty, and make local communities more resilient. With this agreement, the EIB, thanks to resources provide by European Commission Climate Neutral and Smart Cities Mission, our advisory support will help the Mission Cities as pioneers move from ambition to action, preparing real investments that support households and businesses while contributing to national climate targets.

With the right planning and partnerships, Ireland can quickly catch up to European leaders in district heating. This advisory engagement will provide the roadmap for investment that keeps energy affordable, supports local economies, and delivers lasting climate action.”

The Sustainable Energy Authority of Ireland is eager to gain more expertise in the area and will work with the EIB in learning what has worked in other parts of Europe.

William Walsh, CEO of SEAI, said “District heating generates heat from centralised renewable energy sources, including waste heat from big energy users, and pipes it into people’s homes and buildings.

It works really well in other countries, but it’s not something we are overly familiar with here in Ireland. That needs to change.

We’ve made significant progress decarbonising our electricity, but heat remains a big challenge, and district heating is crucial to meeting that challenge. There’s huge opportunity here in Ireland, which the district heating industry is ready to engage with. SEAI is really excited to work with the European Investment Bank and benefit from the EIB’s vast expertise and knowledge of best practice across other European countries.”

Many household are struggling with energy bills and it is hoped that successful district heating schemes will not only be good for the environment, but will also result in lower heating bills.

“District heating can lower household energy bills, create local jobs, reuse waste heat from industry and data centres, and make communities more resilient against global energy price shocks”, the department for climate and energy said in a statement.

“Research supported by SEAI and Ireland’s Climate Council shows that well-planned district heating schemes return strong economic and environmental benefits when matched to urban regeneration and retrofit programmes.”