Vertiv EMEA president Giordano Albertazzi looks back on data center expansion in the Nordics and the regions role as an efficient best execution venue for the future.
At the start of the new year its natural to look to thefuture. But its also worth taking some time to think back to the past.
Last year was not only another period of strong data center growthglobally, and in the Nordic region specifically, but also the end of a decadeof sustained digital transformation.
There have been dramatic shifts over the last ten years butthe growth in hyperscale facilities is one of the most defining and one withwhich the Nordic region is very well acquainted.
According to figures from industry analysts Synergy Researchthe total number of hyperscale sites has tripled since 2013 and there are nowmore than 500 such facilities worldwide
And it seems that growth shows no signs of abating. Accordingto Synergy, in addition to the 504 current hyperscale data centers, a further151 that are at various stages of planning or building.
A good numberof those sites will be sited in the Nordics if recent history is anything to goby. The region has already seen significant investment from cloud andhyperscale operators such as Facebook, AWS and Apple. Google was also one ofthe early entrants and invested $800 million inits Hamina, Finland facility in 2010. It recently announced plans to invest a further $600 million in an expansion ofthat site.
I was lucky enough to speak at the recent DataCloud Nordicsevent at the end of last year. My presentation preceded Googles country manager,Google Cloud, Denmark and Finland, Peter Harden, who described the companysgrowth plans for the region. Hamina, Finland is one of Googles mostsustainable facilities thanks in no small part to its Nordics location whichenables 100% renewable energy and innovative sea water cooling.
Continuing that theme of sustainability, if the last decadehas been about keeping pace with data demand, then the next ten years will beabout continued expansion but importantly efficient growth in the right locations,using the right technology and infrastructure. The scale of growth beingpredicted billions of new edge devices for example will necessitate asustainable approach.
That future we at Vertiv, and others, believe will be basedaround putting workloads where they make most sense from a cost, risk, latency,security and efficiency perspective. Or as industry analysts 451 Research putsit: TheBest Execution Venue (BEV). (a slightlyunwieldy term but an accurate one). BEV refers to the specific ITinfrastructure an app or workload should run on cloud, on-premise or at theedge for example but could also equally apply to geographic location of datacenters.
In that BEV future, the Nordics will become increasingly important for hosting a variety of workloads but the sweet-spot could be those that are less latency sensitive high performance compute (HPC) for example and can therefore benefit from the stable, renewable and cheap power as well as the abundance of free cooling. Several new sub-sea cables coming online over the near future will also address some of the connectivity issues the region has faced.
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A recent study by the Nordic Council of Ministers estimatesthat approximately EUR 2.2 bn. have been invested in the Nordics on initiateddata centre construction works over the last 12 to 18 months (2018). Mainlywithin hyperscale and cloud infrastructure. This number could exceed EUR 4 bn.annually within the next five to seven years because of increasing marketdemand and a pipeline of planned future projects.
Vertiv recently conducted some forward-looking research thatappears to reinforce the Nordics future potential. Vertiv first conducted itsData Center 2025 research back in 2014 to understand where the industry thoughtit was headed. In 2019, weupdated that study to find out how attitudes had shifted in the interveningfive years a half way point if you will be between 2014 and 2025.
The survey of more than 800 data center experts covers a range of technology areas but lets focus on a few that are important and relevant to the Nordics.
We mentioned the edge a little earlier when talking about BEV.Vertiv has identified fourkey edge archetypes that cover the edge use cases that our experts believewill drive edge deployments in the future. According to the 2025 research, ofthose participants who have edge sites today, or expect to have edge sites in2025, 53% expect the number of edge sites they support to grow by at least 100%with 20% expecting an increase of 400% or more.
So along with providing a great venue for future colo and cloud growth, the Nordics, like other regions, is also likely to see strong edge growth. That edge demand will require not only new data center form-factors such as prefabricated modular (PFM) data center designs but also monitoring and management software and specialist services.
Another challenge around edge compute, and the core for thatmatter, is energy availability and increasingly, access to clean, renewableenergy.
The results of the 2025 research revealed that respondentsare perhaps more realistic and pragmatic about the importance and access toclean power than back in 2014. Participants in the original survey projected22% of data center power would come from solar and an additional 12% from windby 2025. Thats a little more than one-third of data center power from thesetwo renewable sources, which seemed like an unrealistic projection at the time.
This years numbers for solar and wind (13% and 8% respectively) seem more realistic. However, importantly for Nordics countries with an abundance of hydropower, participants in this years survey expect hydro to be the largest energy source for data centers in 2025.
The data center 2025 research, also looked at one of theother big drivers for building capacity in the Nordics: access to efficientcooling.
According to the 2025 survey, around 42% of respondentsexpect future cooling requirements to be met by mechanical cooling systems. Liquidcooling and outside air also saw growth from 20% in 2014 to 22% in 2019, likelydriven by the more extreme rack densities being observed today. This growth inthe use of outside air obviously benefits temperate locations like the Nordics.
In summary, if the last ten years have been about simplykeeping up with data center demand, the next ten years will be about addingpurposeful capacity in the most efficient, sustainable and cost-effective way:the right data center type, thermal and power equipment, and location for theright workloads.
If the past is anything to go by, the Nordics will have an important role to play in that future.
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