‘We've dropped the ball': Ireland's housing targets will be missed because the water, electricity and roads required can't be delivered

Irish Times

21-06-2025

When
Bertie Ahern
was taoiseach, he invited the chief of the
Madrid
metro to Merrion Street to discuss underground rail for
Dublin
. The late
Prof Manuel Melis Maynar
had built the Spanish system in record time at minimal cost. At a meeting in
Government Buildings
, he said the limestone beneath Dublin was ideal for tunnelling. Ahern replied: 'When can you start?'
That was in 2003. Two decades later, the perennial wait for a Dublin metro goes on. The saga is but one tale of
Irish
infrastructure woe among many. But if the metro is something of a national joke, other stalled projects do not invite laughter. The Republic's water and electricity networks are increasingly overstretched, prompting sharp questions about the response to the worsening housing crisis.
The need to accelerate housing output has never been greater but utilities are stuck in the slow lane. These are the pipes and wires that keep water and electricity flowing. As the
housing shortage
drives young adults to despair or their childhood bedrooms, warning lights are flashing about the State's ability to settle the most pressing problem facing Irish society.
The population is forecast to reach six million by about 2040, so demand for infrastructure will only grow. But
Uisce Éireann
, the water authority, has warned
it may have to stop connecting new Dublin homes within three years
if a long-delayed wastewater plant does not clear planning soon.
READ MORE
At the same time, thousands of new homes have been delayed because they can't access power. State electricity company
ESB Networks
accepts the need to reinforce the network in certain places because of soaring demand. But some critical equipment can take as long as three years to procure. 'It's in the red zone,' says one big housing developer who has dealings with the ESB.
As the Government struggles to boost construction, all of this means privileged State bodies responsible for critical services can't guarantee timely delivery.
So what are the reasons for the crunch? What can be done about it? And what about the ever-rising cost of building such infrastructure?
'There has been a mood change in that there's a recognition now that because of infrastructure we can't deliver housing,' says a senior industrial figure who grapples daily with the utilities deficit. 'We have dropped the ball. We had spare capacity but now we're running on fumes.'
The roots of the problem lie in the huge expansion of the State's population and economy, which was not matched by a corresponding increase in critical infrastructure.
The population is estimated to have reached 5.38 million in 2024, compared with 3.79 million in 2000, a 1.59 million increase in a quarter-century. In the same period the number of people working in the State has risen to 2.79 million from 1.65 million, an increase of 1.14 million.
Seán Laffey, Uisce Éireann: 'We're not saying people shouldn't have the right to object, but it should be treated in a way that is accelerated.' Photograph: Damien Eagers/The Irish Times
'We're playing catch-up now,' says Seán Laffey, asset management and sustainability director at Uisce Éireann, adding that it takes between seven and 10 years to plan and build water and wastewater infrastructure.
'We have an infrastructure which was perfectly capable of handling maybe 4-4.5 million people. Now we're up to 5.7 million – nearly six million people – and we're behind. Now, we did have a surplus; we're very lucky in that respect. But we're actually maxing that out now.'
Making matters worse was disruption from the 2008 economic crash, which brought construction to a halt for several years and cut off funding for initiatives such as the Dublin metro. Then there was the coronavirus pandemic, which closed large parts of the economy and concentrated political action on healthcare, almost to the exclusion of everything else.
The upshot is that the State is playing catch-up on infrastructure. Basic services now lag behind huge housing and industrial demand, but utility projects face long delays because of planning logjams, legal issues and red tape.
Inevitably, delays spur costs. But infrastructure experts say the mechanisms for sanctioning big State projects have never been more cumbersome or frustrating.
One weary infrastructure warrior laments roadway routes being re-examined even after compulsory purchase orders were already in train to buy land on an approved route.
We found that Ireland's infrastructure is about 25 per cent lower than what you find in other high-income European countries
—
Niall Conroy, Irish Fiscal Advisory Council
Another speaks of a mind-numbing culture of 'reviews of reviews' under crash-era measures to control public spending: 'This approval process has people review the business case and assess projects at a level of detail that has already been assessed by experts.'
A third individual refers to 'significant heartache', saying measures seem designed more to make it more difficult to bring forward projects than clear the way for building. 'People become beaten down and jaded by it,' he says. 'The density of our bureaucratic process is a major factor.'
Outgoing
Transport Infrastructure Ireland
(TII) chief executive Peter Walsh, whose office is in charge of the latest metro plan, says project timelines have doubled since the early 2000s.
When he was involved in national road projects at the turn of the century, it usually took seven years from conception to completion. 'It is now well in excess of 15 years,' he says. 'I think the challenge for delivering infrastructure generally is very serious.'
Such delays are not unique to transport – and there are implications far beyond housing.
One concern is the State's heavy dependence on foreign direct investment from multinational companies, many from the United States. Almost 1,000 US companies are in Ireland, the best known of them including tech groups Apple, Microsoft, Google and Meta, and pharmaceutical groups Pfizer and Johnson & Johnson. With US trade already under threat from president Donald Trump's tariffs, infrastructure and housing issues make it difficult to make the case for new Irish investment projects.
[
Ireland falls further behind on emissions targets making billions in fines more likely
Opens in new window
]
Another concern is the pressing need to cut carbon emissions to meet climate targets. The electricity shortage has already led to curbs on power-hungry data centres, which dominate demand, and emergency power generation from non-renewable sources. This is not good for environmental goals set down in law.
Research by the
Irish Fiscal Advisory Council (Ifac)
, the official budget watchdog, shows the challenge is stark. 'We found that Ireland's infrastructure is about 25 per cent lower than what you find in other high-income European countries,' says Niall Conroy, acting chief economist.
The main areas of deficiency were in housing, healthcare, transport and electricity. Water systems were 'about average' by European standards, but Ireland needs more water services because of high demand from pharmaceutical, information technology and semiconductor industries.
A little more than 30,000 new homes were built last year, but Conroy says annual output should be closer to 70,000 for a decade to meet demand.
'We estimate that if Ireland was to have a similar level of housing to other European countries given the size of the population, we would have about 250,000 more homes than we currently have,' he says.
'To address that we need to be building at a pretty high rate for a number of years. As the population increases and because of the demographics we have, we need to be building about 44,000 houses per year just to stand still.
'Then, if you want to address that unmet demand, if you wanted to do that over 10 years, we reckon you'd need to be building another 25,000 on top of that every year for about 10 years. That gets you to about 69,000 per year.'
This means housing output would have to more than double. But can it be done?
'Most people would point to a difficulty getting connections to the electricity grid and to water or wastewater facilities,' says Conroy.
Ifac's concerns mirror those of authorities such as the International Monetary Fund (IMF). In a recent report on Ireland, the IMF says 'several key challenges remain in the effective delivery of infrastructure – including planning delays, low construction productivity (including the need to utilise modern methods of construction), and labour shortages in the construction sector'.
Video: Dan Dennison
The Central Bank has similar anxieties. 'The Irish economy is facing well-documented infrastructure challenges in housing, energy, water and transport, which to be addressed will necessitate a rise in construction sector activity,' the bank said this week as it cut housing delivery forecasts for 2025, 2026 and 2027.
This prompts unavoidable questions about conditions on the ground, where builders say the utilities crunch is starting to hinder housing delivery in areas of high demand.
'The
LDA [Land Development Agency]
is bumping into servicing infrastructure issues in relation to some of its sites, which it's working to overcome with the relevant authorities,' says John Coleman, chief of the LDA, the State body charged with building thousands of homes on public land.
A titanic effort is required to boost housing output. But water and wastewater networks are under huge strain already. 'The crunch is here,' says Laffey of Uisce Éireann, adding that capacity is fast running out in Dublin.
The national water authority can sustainably produce 618 million litres of water per day in the capital and its hinterland. However, demand over the May public holiday weekend hit 658 million litres. 'So we are running down our reserves of drinking water during the week and we're catching up at the weekend,' says Laffey.
The solution for Uisce Éireann lies in a project to bring treated Shannon water to Dublin through a 170km pipeline from the Parteen Basin in Co Tipperary. The authority will seek planning permission at the end of 2025, but Laffey is conscious of the risk of legal challenge.
'In Ireland one person anywhere on the island can take a judicial review,' he says. 'Given the vociferous opposition we have to the pipe in certain areas down in Tipperary, we probably would expect it.'
[
Project to pipe water from river Shannon to Dublin could cost €10bn
Opens in new window
]
The body's wastewater plans have already hit a legal wall. Uisce Éireann went to
An Bord Pleanála
in 2018 seeking permission for a new Greater Dublin Drainage (GDD) scheme to supplement the major Dublin plant at Ringsend that is near capacity. 'We've seen four years' worth capacity used up in Ringsend in the last 18 months,' says Laffey.
Permission for the GDD scheme was granted in 2019 but the High Court
quashed it in 2020
after a case taken by a daily sea swimmer. The ruling found the decision 'legally flawed' because the planning board failed to seek certain EPA observations. The matter went back to An Bord Pleanála, with a new decision still awaited.
'We're still in the planning process seven years on and Ringsend is running out of capacity,' Laffey says, warning that Ringsend could reach its limits by 2028. 'Ultimately we either continue and allow the treatment plant to become overloaded to some extent. Or we just stop connections.'
The whole of Dublin is dependent on this to be able to flush the toilet in five years
—
Developer
Has Laffey told the Government of this threat to new housing? 'Yes.'
How far away is the risk of a halt to housing connections? 'We are saying at the moment that the crunch will come in 2028,' he says, adding that a new GDD planning decision is expected in months but that 'interim measures' will be needed.
'If we don't go to judicial review again, we anticipate that plant will be in place in 2032,' he says. 'We should make it. It will be squeaky.'
[
'Constrained' water supply jeopardises new Dublin suburb with 6,000 planned homes
Opens in new window
]
Complicating matters further is that project costs have shot up. When the original GDD scheme went to tender, the price was €630 million. Now the estimate is €1.3 billion. 'That cost has increased by €700 million. No one's talking about it,' Laffey says.
The LDA faces similar pressure. Coleman told an Oireachtas committee that a Judicial Review against permission for 1,000 homes at the former Central Mental Hospital in Dundrum, Dublin, delayed the plans by two years. This added 'at least €30 million' to the €400 million project cost.
So what is the solution to the cycle of delay, disarray and litigation?
'Ireland has created an objection manufacturing facility because the legal system allows for objectors to intervene at a very low level,' says a veteran of court battles. 'The legal threshold for objection is very low.'
According to an informed source, one proposal under Government consideration is to cap the legal fees in judicial review cases on critical infrastructure. At present litigants can claim all their legal fees from the State if they successfully challenge an infrastructure project in court. The idea of imposing a cap on such costs, which has yet to be settled definitively, would limit fees to €35,000. With costs in some cases running to hundreds of thousands of euro, the aim would be to reduce the incentive for lawyers to take on judicial review actions on a 'no foal, no fee' basis.
A further idea is to fast-track planning and any litigation on designated 'public interest' projects.
[
The Irish Times view on infrastructure: stop making the same mistakes
Opens in new window
]
'Could we have a policy for public good so that if we put in an application for a wastewater treatment plant it gets treated as a priority?' asks Laffey. 'If it ends up in the courts, it gets treated as a priority. We're not saying that people shouldn't have the right to object. Of course they should. But it should be treated in a way that is accelerated.'
Another proposal is to move from the sequential submission of planning and consent papers to a system of parallel submissions made simultaneously, in effect telescoping a process that takes years to complete.
More radical still would be measures to exempt the most critical utility projects from planning procedures. This would be highly controversial, certainly. But the risks posed by any failure to finally deliver the GDD project are significant. 'The whole of Dublin is dependent on this to be able to flush the toilet in five years,' says one developer who faces project delays because of constraints on water and power supplies.
How grave is the electricity problem? Conroy estimates the network in the Republic is about 25 per cent below comparable European countries. 'In recent years there's been a shortage of generation capacity in the Irish power system,' he says.
Niall Conroy, acting chief economist with the Irish Fiscal Advisory Council. Photograph: Damien Eagers
Industry regulators brought in emergency generation to fill the gap in the short term, but the machines burned fossil fuel. 'Ideally, if we are adding additional electricity generation capacity it should be in renewables.'
The pressures on the network have been all too apparent for years. In 2021 national grid manager EirGrid curbed electricity access in Dublin for data centres, buildings that house highly energy-intensive computer systems for storing internet and business data. The next year new data-centre gas connections were stopped.
This remains a matter of contention with big US tech groups. While industry figures say the curbs have driven big data-centre projects away from Ireland, ministers have been advised to 'ration' connections for new centres.
Such tensions were set out in clear terms a month ago when Oonagh Buckley, secretary general of the Department of Climate, Energy and the Environment, spoke at a public meeting about trade-offs between housing needs and the power demands of the growing artificial intelligence (AI) industry. 'We're having to even think about prioritising what is the social need of the demand – is it housing or is it AI?' she said.
This reflects the view that it is already a daunting challenge to meet the electricity needs of a growing population, before any discussion on data centres.
Central Statistics Office (CSO) data shows total metered consumption of electricity grew 30 per cent between 2015 and 2024, with data centres taking up the overwhelming portion of the growth. Their share of power consumption doubled to 22 per cent in 2024 from 11 per cent in 2020 and more than quadrupled from 5 per cent in 2015.
The increased share of demand came despite the addition of almost 204,000 residential meters to the network between 2015 and 2024.
Tens of thousands of new homes are required to settle the housing crisis. However, developers on sites with hundreds of homes in certain areas of Dublin have been told electricity connections are not possible without new power substations. Such infrastructure is critical, converting high-voltage electricity from power plants to lower-voltage supply for homes.
ESB Networks says single individual homes can be connected within weeks, but new multiphase residential or industrial developments 'could require a very significant amount of new infrastructure' which is then subject to design, planning and procurement lead times. The company cites challenges securing viable sites for substations and requests for connections in areas of limited demand. Other issues include long lead times to procure kit.
'Network reinforcement projects can take a number of years to deliver,' it says.
Transport timelines are also measured in years – and the more years that pass, the more costs rise.
When Melis Maynar of Madrid met Ahern 22 years ago, the projected costs for the original Dublin underground varied between €3.4 billion and €4.7 billion. Such figures, large as they are, now appear trifling.
With MetroLink delivery not likely until some time in the 2030s, the project was costed in a range between €7 billion and €12 billion in 2021. But that was before post-Covid inflation set in. Now there are fears that costs, in the worst-case scenario, could balloon to €23 billion or even more.
[
Dublin's Metrolink project could go 40% over budget and leave many homes 'grievously impacted'
Opens in new window
]
But Walsh of TII says the MetroLink plan is critical for climate targets. 'If there's any hope of decarbonising mobility in Dublin, we absolutely need to build the metro.'
If MetroLink happens, the cost will be many multiples of the €1.45 billion Spain spent in the 1990s building 56km of Madrid metro lines in four years. This was helped by 24-hour tunnelling and Melis Maynar's aversion to fancy architecture, and his reluctance to fork out big fees to 'consultants who consult with consultants and advisers who advise advisers'.
Without any tunnelling or tracks laid, the State has already paid dearly for metro planning. Spending on MetroLink had reached €181 million by July 2024. When the first metro plan was scrapped in 2011, the State wrote off €225 million of exchequer funding for the scheme.
Infrastructure is always expensive but the consequences of failure could be even more costly.