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Home»Tech News»Rising energy costs erode competitive edge of colocation datacentre operators
Tech News

Rising energy costs erode competitive edge of colocation datacentre operators

August 17, 2022Updated:August 17, 2022No Comments4 Mins Read
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UK-based datacentre cooling firm FEL Group ceases trading
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Datacentre operators from throughout the UK and Eire have opened up concerning the monetary challenges their companies are going through on the again of hovering vitality prices.

In a survey of 253 datacentre professionals from the UK and Eire, commissioned by Aggreko, greater than 60% mentioned their electrical energy payments had elevated by as much as 40% over the previous three years, whereas 3% of the UK respondents reported value will increase in extra of fifty%.

In consequence, greater than half of the UK contributors within the ballot (57%) mentioned electrical energy now makes up between 10-to-30% of their complete working prices, whereas an additional 25% mentioned they’re paying “nicely over” that quantity.

“Within the subsequent six months, most anticipated to be paying related, though those that mentioned they anticipate paying 40% or extra had elevated,” mentioned Aggreko in its accompanying 21-page The facility battle – information centres report. “In 12 months’ time, the bulk once more anticipated to pay between 10-to-30%, however those that selected one of many greater bands elevated as soon as extra. This gradual shift suggests low confidence within the vitality market over the brief time period, with most anticipating larger pressure on the stability sheet.”

In the meantime, 63% of contributors from the Republic of Eire (RoI) said that electrical energy accounts for as much as 40% of their complete working prices.

By way of the affect that is having on the sum of money operators are capable of make, it appears UK-based respondents have been struggling greater than their RoI counterparts.

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“Outcomes recommend the UK datacentre market has suffered greater than the RoI,” the report continued. “At 58%, the bulk mentioned rising vitality payments had a ‘vital affect’ on their margin within the final two years. Within the RoI, the outcomes have been extra evenly break up between ‘slight’ and ‘vital’ affect at 47% and 49%, respectively. That mentioned, in each markets, solely 4% reported no change.”

The respondents to the ballot predominantly work at colocation companies with between at the least 100 and a couple of,000 staff, with Billy Durie, international sector head for datacentres at Aggreko, stating that it’s more likely to be the smaller gamers which might be feeling the pinch from rising vitality prices for the time being.

“It’s unsurprising to see datacentres are feeling the stress,” he mentioned. “As excessive vitality customers, the worth will increase will little question make it more durable for smaller amenities to stay aggressive, and our survey reveals simply that.”

The report additionally comes a number of months after rising vitality prices have been cited as a motive why the UK arm of colocation supplier, Sungard AS, had fallen into administration. 

The report additionally highlights the actions operators are taking to mitigate the affect excessive electrical energy prices are having on their enterprise, with greater than 70% of UK respondents claiming the scenario is making it more durable for them to be aggressive.

These actions embrace putting in extra energy-efficient heating and lighting methods, in addition to collaborating in demand-side response schemes, to drive down the quantity of vitality their websites devour from the grid.

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On this level, greater than 70% of UK companies polled cited vitality safety as a priority, which the report mentioned shouldn’t be an unfounded concern given 65% mentioned that they had skilled energy cuts at varied factors over the previous 18 months.

The place the RoI respondents have been involved, 80% mentioned energy continuity was a priority for them, with 60% having previous expertise of energy outages. “Of that group, many reported having to both scale back or pause operations whereas the outage was resolved,” the report said.

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