Danish government in ambitious datacentre push

Denmark offers many natural benefits for organisations looking to build datacentres in Europe, and a soon-to-be-completed connection to the US will make it even more attractive

Denmark’s ambition to become a leading Nordic and European location for hyperscale datacentres continues to gain momentum by attracting major industry actors and government support.

Danish politicians are calling it the renewable energy “dividend”.

The country is offering access to a low-cost and expanding renewable energy base to lure global companies such as Facebook, Google and Apple.

And the plan appears to be working. Not only do Facebook, Google and Apple have a presence in Denmark, but they are all growing their operations there. Apple is constructing a 166,000m2 hyperscale datacentre near Viborg and is set to build a second datacentre near Aabenraa.

Meanwhile, Facebook is building a 55,000m2 datacentre in Odense and Google has acquired a 200-acre site in Fredericia and a 280-acre site in Aabenraa for potential datacentre projects.

The Havfrue (the Danish word for mermaid) submarine cable project, which will connect North America with a number of European countries, including Denmark, is seen as another asset to help the Danish government position the country as the Nordics’ top digital hub. The cable system is scheduled to enter service in the fourth quarter of 2019.

Denmark’s Nordic hub initiative is an integral part of the government’s digital industry and technology development plan for 2020-2030. The plan, supported by prime minister Lars Løkke Rasmussen’s centre-right coalition, aims to create a strong underlying infrastructure in partnership with the private sector.

The long-term strategy is to position Denmark as both a Nordic and pan-European hub for datacentres.

Read more about IT in Denmark

The projected surge in the number and scale of datacentres is certain to have a dramatic impact on the Danish economy. The ministry of economic and business affairs has estimated that Denmark’s electricity consumption will grow by about 24% by 2025, with datacentres responsible for about half of the increase. 

The energy “dividend” so prized by Rasmussen’s pro-tech government is primarily based on offering cheap access to the country’s large offshore renewable power base.

Denmark is also investing heavily to strengthen its reputation as a frontier nation for digital technologies. The country’s digital advance is a significant factor in its drive to persuade more datacentre developers to set up operations there.

Provisional estimates, based on data collated by the finance ministries of Denmark and Sweden, indicate that the Nordic datacentre construction market could be worth between €4bn and €5bn by 2024, and Denmark is expected to take the lion’s share of this revenue.

“Denmark’s edge comes from our ample power supply from a high-capacity grid,” said Kim Schultz, a senior adviser on datacentre strategies with Invest in Denmark (IID), the state-funded investment support agency. “We can also provide all the dark fibre required and a large choice of potential low-risk sites. We are seeing increasing interest from digital services companies, internet exchange providers and colocation datacentre operators.”

The Danish government has tasked IID with developing an integrated approach to promoting inward investment from leading actors in the global datacentre and digital community. A central part of this mission is to create structures offering attractive business opportunities to datacentre companies and co-ventures between indigenous enterprises and foreign companies that are looking to locate facilities for computer systems, telecommunications and storage systems in Europe.

The main areas for potential co-ventures identified by IID include facility design, energy efficiency and server cooling. About 40% of a datacentre’s energy consumption is used to cool down the servers. Denmark’s attractions include its climate, which is ideal for cooling; opportunities to pursue advanced green technologies; and a legislative framework that is highly conducive to the construction of datacentres.  

Havfrue project

The Havfrue project also promises to boost international interest in Denmark as a datacentre location. The cable will connect New Jersey in the US to the Jutland peninsula on Denmark’s west coast, and will have branch extensions and optional branch links to Ireland’s west coast at Mayo, the UK, the Netherlands and southern Norway.

The project promises to enhance Denmark’s position as a northern European digital hub. The submarine cable, which is owned and operated by a consortium that includes Aqua Communications, Bulk Infrastructure and Facebook, comprises a trunk cable with a cross-sectional cable capacity of 108Tbps which is scalable to higher capacities using next-generation submarine line terminal equipment.

Denmark’s long-term objective is to become a leading international digital hub connecting the Nordics, Europe and North America, said Jesper Frost Rasmussen, mayor of Esbjerg city. Denmark’s biggest cities and regions are competing to attract prestige datacentre projects. As a result, local authorities are increasing investment in IT infrastructure and are offering top-end mobile telephone, internet and broadband networks to lure foreign projects.    

For its part, Esbjerg is in advanced negotiations to bring a major datacentre operator to the city, a project Rasmussen describes as “massive for the region”. The still-unnamed foreign company is proposing to build a 250,000m2 datacentre on the west coast outside Esbjerg.

“The Havfrue cable will reach land near here,” said Rasmussen. “We have the infrastructure. The proposed project has the potential to generate a lot of new jobs. Long term, we see the establishment of a hyperscale datacentre as being a forerunner for a continuous line of smaller datacentre operations in the area.

“Google, Apple and Facebook are already operating in the region. We hope to significantly expand this cluster of datacentres in the coming years.”

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