Building the Resilient Data Center

On July 18th of last year, much of the UK was suffering through a third day of record-breaking heat. As temperatures soared above 40 degrees Celsius (104 Fahrenheit), the country’s infrastructure strained to remain operational. Rail travel was curtailed or stopped completely to avoid track buckling. Several airports shut down after runways melted or deformed. To avoid blackout, National Grid was forced to purchase electricity from Belgium at a crushing cost - £9,724 per MWh, or 5,000 times the normal price.

In London, data centers struggled to keep their servers cool as outdoor temperatures soared. In the end, several large data centers were forced to shut down as redundant cooling systems failed. Environmental temperatures had simply exceeded design parameters.

Although this story garnered a great deal of attention in data center circles at the time, those London data center operators were hardly alone in contending with the unexpected environmental and energy volatility of the past years.

This volatility is a growing threat to data center operations all over the world, and is constraining profitability, uptime, and the placement of new facilities. Multiple factors are now conspiring to disrupt our energy system, including climate change, geopolitics, and grid constraints. These disruptions have manifested as volatility in energy prices, constrained supplies, and more frequent and severe outages.

CHALLENGES

Energy Cost Volatility

Climate change, geopolitics, and supply chain stress combined to create record levels of energy price in 2022, and 2023 offers continued risk. The Russian invasion of Ukraine set off an energy crisis across Europe, with dramatic fluctuations in energy prices, and widespread anxiety about being able to meet energy demand across the continent. Although the continent was graced with a relatively mild winter, and the EU has taken action to accelerate the transition away from Russian fossil fuels, the energy crisis there is unlikely to resolve any time soon.

In the United States, a succession of natural disasters caused high volatility in wholesale electricity prices throughout 2022. These included winter storms and natural gas constraints in New England, heat waves in Texas and the western states, and extreme cold in the Pacific Northwest.

Energy cost volatility can make it difficult for data center operators to plan investments, anticipate profitability, and attract capital.

Grid Constraints

Availability of grid power and transmission capacity is a growing constraint on the placement of data centers, and is further contributing to energy price uncertainty for data center operators. In Ireland, data centers use a whopping 17% of the nation’s energy – a figure that is expected to rise to 28% by 2030. Generation capacity on the Irish grid has become extremely limited, and has created a de facto moratorium on new data center development, with more than 30 projects put on hold.

In Northern Virginia, another famous digital infrastructure hub, the electrical grid is similarly challenged to meet the growing demand of data centers. The state Department of Environmental Quality was preparing to lift restrictions on running diesel generators so data centers could use their backup power systems to relieve grid stress during emergencies. After significant public outcry over the potential emissions associated with such a scheme, the state retracted the proposal in April.

Around the world, competition not just for electricity, but for water to generate electricity, is going to continue to limit where new data centers can be built, and may stoke public opposition to new projects.

Increasingly Frequent and Severe Outages

Climate change is challenging grid reliability in multiple ways simultaneously, including drought, wildfires, and severe storms. Incidents of sabotage are also on the rise. On top of supply constraints caused by the Russian invasion of Ukraine, Europe had to deal with widespread and sustained power outages in 2022 from heatwaves and floods. In the United States, power outages caused by severe weather are increasing in frequency, and duration. Long term outages like those precipitated by wildfires in California, or recent freezes in Texas, can challenge a data center’s store of diesel fuel, and these same conditions can both create immense competition for this fuel, and impede its delivery. Of course, extreme weather can also impact data center energy infrastructure directly, threatening onsite transformers and energy distribution equipment.

SOLUTIONS

Energy Efficiency Upgrades

Data center operators have a variety of tools at their disposal to help shield their budgets from energy prices spikes, and their operations from outages. The first step for any data center is to maximize energy efficiency. The lower the energy bill, the smaller the exposure to all of the risks we discussed above.

The PUE metric has driven impressive improvements in data center efficiency, but over the past five years industry-wide PUE has remained relatively flat. New innovations are necessary to continue to realize efficiency gains. Exciting developments are coming fast in the form of new cooling systems, advanced monitoring and control systems for power, building, and IT, and efficient UPS.

Electric has found that running a UPS in their patented eConversion mode can save a typical data center hundreds of thousands of dollars in energy over the life of the UPS.

Energy Procurement Diversification

A diverse energy portfolio can help a data center operator hedge against cost volatility, especially with a focus on renewables that are shielded from fuel cost fluctuations. Expert guidance can optimize financial performance of an energy portfolio. This should help to alleviate grid constraints, and help demonstrate to the public that the data center is contributing value to the community.

Finally, a diverse energy portfolio focused on renewables will reduce the carbon footprint of the data center itself, which will in turn help to combat climate change and mitigate future energy volatility.

Onsite Energy Resources / Microgrids

Data center operators are increasingly looking to onsite energy resources (both generation and storage) as a successor to diesel backup generation, to facilitate grid interaction, and as a cleaner solution fro prime power. Onsite energy resources managed as a microgrid can be controlled to optimize cost performance, choosing the least expensive source at any given time, and facilitating participation in demand response programs.

A data center microgrid can also decrease the load on the grid, and help to relieve congestion and associated public opposition. Perhaps most importantly, a microgrid built around large capacity assets like a natural gas generator or a fuel cell may allow a data center to weather longer outages than possible with onsite diesel fuel stores.

CONCLUSION

We can expect continued volatility in energy markets as the energy system undergoes fundamental restructuring, and as the effects of climate change on energy infrastructure grow. Data centers operators need to protect their operations from cost fluctuations and outages. A the same time, they must convince their host communities and countries that they are part of the solution, and not just competitors for scare energy resources.