Data centers in Norway – updated national strategy provides new business opportunities

With its cold weather, easily available renewable strength, competitive prices on electrical power, a modern day electronic infrastructure and active aid from the federal government, Norway – rated as the world’s most resilient state – is progressively noticed as a favorable site for global details middle tasks.

In Europe, Norway has basic rewards in terms of financial investment options in info facilities and attracts world fascination. Just one illustration is Azrieli Group’s acquisition of Inexperienced Mountain Info Facilities, exactly where DLA Piper assisted Azrieli Group. Industry gamers are expecting a quick expansion in the Norwegian info center sector over the up coming handful of decades, and new possibilities are presently showing on the market.

Any person looking at options in the details heart market in Europe may possibly anticipate sturdy forecasted advancement and a quick enlargement about the coming a long time if they glance to Norway. The region has a robust position in capturing new European demand from customers for details heart capacity, and any development will be fueled by charge effectiveness and obtainable, green and renewable electricity.

Introduction

As talked about in our 2015 Genuine Estate Gazette report “High tech true estate – the long run appears to be shiny for facts centres in Norway,” Norway has really favorable local weather problems for environmental cooling, plentiful cleanse power methods, a very good electrical energy grid and fiber infrastructure, significant accessible land regions and a competent workforce in both equally the real estate and IT sectors. In 2015, even so, Norway’s tax placement on power consumption was an obstacle for huge-scale information middle activities in contrast to neighboring jurisdictions such as Sweden, Denmark and Finland.

Due to the fact 2015 the authorized, political and economic framework for data heart action in Norway changed in a positive route for the two builders and opportunity investors. As we start off 2022, Norway is positioned to seize a disproportionately massive share of foreseeable future growth in hyperscale cloud amenities, large effectiveness computing and organization details centers.

Reduced whole cost of possession

A person of the primary essential strengths of investing in Norwegian facts center initiatives right now is the minimal full value of possession. When compared to other European markets, rental prices, availability of land, cooling charges and the value of powering racks in Norwegian details centers are viewed as extremely competitive.

With its supply of hydropower, Norway has a prolonged tradition of granting favorable tax prices on vitality consumption to electricity intense industries. Aluminum output was an early case in point. Details facilities ended up not included in the tax regime with reduce tax premiums for sure power intense industries in its early days. But due to the fact 2017, details facilities in Norway have been deemed an energy intense industry for tax reasons, meaning that favorable tax charges now implement on knowledge centers’ vitality usage. This adjust has brought Norway to the forefront when it comes to full cost of ownership, with some of Europe’s least expensive power rates on information centers’ vitality use.

Norway normally presents good energy utilization usefulness (PUE) in its data centers. PUE is a metric applied to decide the energy performance of a information center. It is calculated by dividing the total amount of electricity getting into a information heart to be utilised on cooling and supporting the facility as a entire, by the quantity of ability utilized by the computing equipment by itself, with the ideal amount currently being as shut to 1. as attainable.

A single of the principal explanations for Norway’s fantastic PUE scores is Norway’s interesting climate, which allows exceptional effectiveness because of the automatic and cost-free cooling from the environment. The significant amount of times with very low temperatures makes it possible for for better PUE than web-sites in hotter climates. Details facilities in Norway also make use of chilly seawater from neighboring fjords for cooling.

Green and renewable electricity

Norwegian electrical power manufacturing comes almost solely from eco-friendly and renewable resources, and predominantly from hydropower. Hydropower is deemed to be the least expensive supply of renewable vitality, and accounts for around 90% of Norwegian electrical energy creation. Norway’s creation of renewable strength already exceeds usage, and Norway has for a very long time been a net exporter of renewable electricity. In 2020, 98% of the electrical power intake in Norway arrived from renewable vitality sources, the optimum amount in Europe.

Current market leaders in the data heart neighborhood target on the origin of the power and on environmental, social and corporate governance (ESG) in basic. Norway is on a regular basis rated as one of the world’s most sustainable countries in phrases of ESG compliance. With its effortless accessibility to inexperienced and renewable electricity in an ever a lot more environmentally concentrated market, Norway has a aggressive gain.

What is actually next?

In 2018, the Norwegian govt launched the strategy doc “Norway as a details centre nation.” The method doc involved solutions these types of as favorable assets tax on sites, extra funding to further more improve fiber connectivity to other nations around the world, new and simplified legal framework for fiber cable digging on public land, and more funding for greater training in the IT sector.

The 2018 technique doc was observed as a results, and in August 2021 the Norwegian governing administration released a new strategy, signed by 5 distinct ministers, to invite international parties to establish details centers in Norway. As a result of the approach doc the government expressed the intention to:

  • concentration on how Norway can support overseas companies set up themselves with data centers
  • raise competitiveness by insuring ongoing secure framework ailments for the market
  • aid sustainable growth by introducing specifications about the use of surplus/squander heat and making a nationwide heat map for better usage of surplus/waste heat
  • raise the performance of growth and permits
  • raise the cooperation concerning the market and educational institutions and
  • strengthen digitalization.

As part of the 2021 method, and to underline the attractiveness of Norway for information facilities, the authorities has also issued guides on how to set up a data heart in Norway. The facts substance states specifically that the Norwegian federal government wants even a lot more firms to pick Norway as the place for their info heart, and that the federal government is committed to generating the approach of developing a facts center in Norway as sleek as feasible.

Soon after elections in September 2021, Norway now has a new authorities. The new governing administration has not expressed any intention to deviate from the system that was introduced in advance of the election. DLA Piper continues to monitor the signals from the new govt in relation to the data centre industry.

Maria Flores

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