New market report shows great potential in targeted national strategy for data centers

Denmark can exploit and further develop its strong position when it comes to building and operating climate-positive data centers, if the politicians agree to formulate a clear and targeted national data center strategy. The potential for developing and exporting technologies and solutions “the green Danish way” directly relates to the competencies in the country, shows a new market report from the Danish Data Center Industry.

This year, the association celebrates its three-year anniversary since its founding in 2017, and in a few years the new Danish growth industry has documented enormous, global opportunities that can be even greater.

“We have strong Danish competencies in regard to climate-friendly solutions, and therefore we can develop data centers in the green Danish way. The opportunities are present – both technologically and in the market – but we lack a clear political strategy within this area,” says Thomas Volder, chairman of the Datacenter Industry. “In both Norway and Sweden, the governments have made a significant effort to attract new investments in this area and ensure that, for example, tax systems and the public supply network are geared for development. Concretely, it involves, among others, the utilization of surplus heat, where the large data centers can make an important contribution to the green transition.”

The new market report documents that in the coming five years a greater amount of the smaller data center hubs (co-location centers) in Denmark are expected – partly through structural development in the industry and partly because other European hotspots have hit its capacity limit. The majority of the stakeholders are seeking a national strategy for data centers, indicating that such strategy, together with EU’s climate ambitions, will further stimulate the Danish potential. The European Commission is now promulgating legislation requiring higher energy efficiency and utilization of surplus heat from data centers.

The market report includes several recommendations for areas critical to the positive development of the industry, such as the expansion of the electricity grid, targeted education, utilization of surplus heat and development of new technologies such as water cooling of data servers that will be part of the upcoming Danish test center for the data center industry.

“We do not see legal requirements as a threat, but rather as an opportunity for Denmark. There are so many obvious opportunities in this, that it calls for a national strategy. Politicians must find a common ground in making sure that we all go into this wholeheartedly – for the benefit of  the climate, development of the Danish export, and our digital economy,” says Thomas Volder.

Facts about the market report

  • Through data collection, analysis and interviews with 65 market participants, COWI has prepared a market report for Danish Data Center Industry on the Danish market in a global perspective
  • At a global level, 132 of the biggest hyperscale data centers are currently being developed – most of these have to meet the increasing needs of actors such as Google, Amazon, Microsoft and Facebook
  • Data center operators are constantly looking for new solutions to reduce high electricity consumption, increase the share of renewable energy and reduce C02 emissions
  • The Nordic countries are expected to get a higher share of the global data center market due to access to renewable energy, stable energy supply, low energy prices, political stability and a low degree of red tape with efficient business processes and rapid market access
  • The upcoming HAVFRUE fiber cable connection between the US and Denmark is expected to attract more colocation data centers to Denmark


Facts about Danish Data Center Industry’s recommendations

  • A national data center strategy, where the politicians come together with the ambition to exploit the strong Danish potential – inspiration can be found in Norway and Sweden
  • Investment in the expansion of the electricity grid to handle the transmission of the large amounts of energy – also to further stimulate the data centers’ own and – very large – investments in green power production, which is an important contribution to the green transition
  • Utilization of surplus heat through a break with an outdated tax regime that is not at all geared for dealing with the fact that data centers will provide large amounts of heat for free disposal.
  • Full support for the upcoming Danish test center for data centers, TIDA, which is set to develop the climate-neutral data center based on strong Danish competences within clean tech solutions
  • New courses, targeted at the industry in collaboration with educational institutions, government and the industry

Purchase report here.

For further explanation and comments please contact:

Chairman of Danish Data Center Industry, Thomas Volder, mobile +45 29 60 60 04

Director of the Secretariat for Danish Data Center Industry, Henrik Hansen, mobile + 45 40 13 44 74

Report enquiries, COO for the Danish Data Center Industry, Merima Dzanic, mobile +45 20 15 50 21