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Data Centers
I am tired of the debate around data centers. Categorically opposing data centers goes against both my sense of fairness and my understanding of environmental protection. So here is my take.
The efficiency of data centers is measured using PUE, or Power Usage Effectiveness. PUE is the total energy consumption of a data center divided by the energy consumed by its IT equipment. In Finland, PUE is very low because less cooling is required. Google’s data center in Hamina has a PUE of around 1.1, while in Southern Europe it can be 1.2–1.35 and in the Middle East as high as 1.5. This means that data centers in Finland consume less energy than in many other locations. For this reason alone, more data centers should be located here.
Finland also uses a little over 30 TWh of district heating annually. Roughly speaking, 30 TWh over a 5,000-hour heating season corresponds to around 6,000 MW of continuous capacity. That is a lot. Of course, peak demand is higher, and some district heating is also needed during the summer. Almost 50% of Finland’s district heating is still produced using wood. Connecting data centers to district heating networks would free up wood for other purposes. And there are plenty of other uses for it, including bio-based projects such as those Forus works with. If we could replace even half of the wood currently used for district heating, that biomass could instead be used to create billions of euros worth of higher-value biofuels and other products.
Finland already has around 2,000 MW of electric boilers, with another 1,500 MW reportedly planned. They produce nothing other than heat, and even that at less than 100% overall efficiency. The electricity they consume does not create any other useful output. Yet while data centers are heavily criticized, I have heard very little opposition to electric boilers.
My argument is this: If building a data center in Finland does not create a new data center globally with a 100% correlation, but instead shifts where a planned data center is built, then we should want those data centers to be built here.
From an environmental perspective, I have difficulty understanding arguments about “our water” or “our electricity.” We are not just Finland. We are one planet. Production should be located where it causes the least overall harm.
A separate question is: under what conditions should we accept data centers?
Instead of opposing data centers, we should focus on making sure they are built in the most responsible way possible.
These are the conditions I would like to see:
100% new renewable energy
Data centers should be required to purchase or own an equivalent MWh volume of new renewable electricity generation. This would give renewable energy producers a sufficiently predictable price for their output, regardless of wholesale electricity prices. At the same time, if additional renewable generation created periods of oversupply, electricity prices would fall, benefiting Finnish consumers. The data center would effectively finance the construction of the new generation capacity.
Use both incentives and requirements to utilize waste heat
At the moment, data centers have too little financial incentive to sell their excess heat for further use. I would like to see data center waste heat used to cover the baseload of Finland’s district heating demand, with only peak demand and temperature boosting handled using biofuels. My proposal would be that data centers receive a refund of their electricity tax for all heat that is successfully delivered for industrial use or heating.
Build regional electricity grids faster
Finland is investing far too little in electricity grids, particularly regional distribution networks. Current regulation has led to a situation where grid companies are unable to invest enough. This affects both smaller companies and major operators such as Elenia and Caruna. Just obtaining permits for electricity grid capacity that would double available capacity in Espoo has already taken six years. In major cities such as Espoo, Turku and Tampere, practically all available grid capacity is already allocated. Weak electricity grids are preventing the creation of thousands of jobs and slowing down the genuine electrification of transport. They also mean that data centers cannot necessarily be built close to district heating networks, even where their waste heat could be utilized.
On the other hand, Finland would then attract the data centers that genuinely want to operate responsibly.
At the same time, these measures could create significant benefits for Finland: more renewable electricity generation, lower overall electricity prices and higher-value uses for Finnish wood and biomass.
I know renewable electricity production quite well, but I know less about data centers. What do you think? What am I missing, and what could change my mind?
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