The expansion, which will see Microsoft invest €98 million – will see a 112,000 square foot facility built at the Grange Castle business park, where the software giant already has a centre.
Between 50 and 70 new jobs will be created when the facility is completed.
Chief Financial Officer for Microsoft, Peter Klein, said the new data centre would be 50% more efficient than normal data centres and would be using renewable wind energy whenever possible.
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The announcement follows Google’s decision in September to build another new data centre in the same business park. It will create 200 construction jobs and 30 full-time positions when complete.