In the AI era, criteria for data centre site selection are evolving to factor in ESG commitments, as well as increased demand for power driven in part by a need for additional cooling. Michael Walker, Consultant at BCS, takes a look at the impact this is having.
Long gone are the days where red carpets were rolled out to data centre providers who were often welcomed with open arms. Now they are viewed with much more distain and there is an increasing high bar for approval. In fact, we have seen a number of high-profile applications turned down recently as the focus has shifted to sustainability, waste heat opportunities, landscape integration and how they will benefit the local community.
Earlier this year, a data centre in Abbots Langley, Hertfordshire, was refused planning permission over concerns that the development would harm the local environment. This was despite the fact that the proposals included the construction of a 300 sqm innovation, education, and training centre. According to the developers, it would have unlocked up to £1 billion in foreign direct investment, delivered hundreds of high-paid jobs, and also injected £12 million in funding for training and education schemes for the local community. However, Three Rivers District Council has voted unanimously to reject it.
Engagement and education is key
In a report last year, TechUK warned that planning challenges have been a constant for data centres, partly because planning professionals are unfamiliar with this type of digital infrastructure development. Planners and local/municipal councils and their understanding of both the importance of data centres and the sustainable benefits they can bring is vital moving forward and the sector will need to take the lead in educating and engaging with these organisations well in advance.
Jobs and investment are no longer enough to ensure success and these relationships are ever more important. In fact, the pivot to AI designed datacentres is a great opportunity to engage early and take these statutory stakeholders with us on the AI journey.
It’s all about power
So, whilst there are various options to address the potential ESG challenges – the one issue that is more challenging is power, which in some ways simplifies things. It means that moving forward the focus for land acquisition can be broken down into a few critical requirements such as electricity availability; access to renewable power; redundant power (back-up power supply); stability of the grid. In short, power capacity is more of a focus than ever before and a welcoming community with a good road network is important too as are places that have room to grow.
So, what’s changed?
Power has always been a major issue in our sector but what has really changed is the attitudes and opinions towards data centres from the governments, local authorities and the public. As they have become more aware of the increasing power demands, the requirements to meet their approval has increased. Red tape imposed by the EU and regional authorities is making this more challenging so navigating approval for a data centre has never been more difficult. Fundamental to this is positioning data centres as grid assets rather than grid liabilities.
The way forward
As we transition into the AI/densification phase of the data centre market, due diligence for site selection will fundamentally not change – but the challenges for getting approval will. Informed conversations with local power providers and relationshipsare key to this on an ongoing basis, particularly as the timeline to prepare power sources for data centres can be five years or more.
This also needs to be factored into the overall timeline and it is also worth considering that power providers will often provide smaller amounts to ‘bridge the power gap’ with a long-term schedule to reach ultimate demands. The expensive delays to Facebook’s 200 MW data centre in Zeewolde is a good example of what happens if you fail to do this.
Other aspects to consider include cost and environmental requirements, security issues, power availability, network bandwidth capacity, redundancy solutions and local regulations to ensure your data centre is situated in the best possible place. However, due diligence, relationships, expertise and experience are at the foundation of every success.
