Finland and Sweden are the best locations for data centers
6.6.2024 – Of all the countries in the world, the best locations for a data center are Finland and Sweden. We offer many competitive advantages that give us the edge over the competition from Central Europe, for example.
Just a few years ago, Sweden accumulated much more investment in data centers than Finland. Now, Finland is also establishing data centers at a record rate. In addition to global tech giants, investments are being made by other companies who are building data centers either for their own use or to let data center premises. The sharp increase in the activity is also evident in Granlund’s data center operations.
Finland and Sweden hold many trump cards that make us the best countries in the world for establishing data centers.
Cheapest electricity in Europe
According to the statistics of Finnish Energy (Energiateollisuus ry), the prices of electricity in Finland and Sweden in 2023 were the lowest in Europe. The average wholesale price of electricity was EUR 56.47 per MWH in Finland and EUR 51.70 per MWH in the Stockholm area.
Compared to Central Europe, the price difference is significant. The corresponding price of electricity in Germany was EUR 95.18, while in Ireland, which attracts a lot of data centers, it was as high as EUR 131.62.
In 2022 in Finland, the share of renewable energy sources was 42 % of total energy consumption.
For data centers, the price of electricity in Finland is now even more competitive as, two years ago, electricity tax was lowered to the minimum EU level for smaller data centers. As a precondition, data centers must be able to either efficiently utilise waste heat or otherwise be sufficiently energy efficient. The tax reduction is significant for companies as the annual electricity bill of a data center may be up to EUR 10 million or more.
Enough emission-free electricity
The requirements of data center customers with regard to emission-free energy have been constantly increasing. It is freely available in Finland and Sweden. In 2022 in Finland, the share of renewable energy sources was 42 % of total energy consumption. CO2-free electricity is produced with hydropower, wind power, solar power or nuclear power.
The security of supply of electricity is also first rate. According to Fingrid (Finland’s transmission system operator), the security of electricity transmission in Finland was 99.99993% in 2022. In Central Europe, the electricity transmission grids are clogged. In Finland, the security of supply of electricity is further improved by the ongoing investments in transmission capacity to the tune of billions of euros.
Finland boasts the most advanced district heating network in the world, which enables the waste heat generated by data centers to be cost-effectively transferred.
Efficient utilisation of waste heat
In theory, all of the heat generated by data centers can be reused. Finland boasts the most advanced district heating network in the world, which enables the waste heat generated by data centers to be cost-effectively transferred. In the past, many data centers released their waste heat into the air or sea. Now, an increasing number of data centers recover their waste heat and redirect it to the district heating network. The waste heat of Europe’s biggest supercomputer, LUMI, satisfies 20% of the annual district requirement of the city of Kajaani in Finland. In the Helsinki Metropolitan Area, Microsoft is designing data centers whose waste heat will cover approximately 40% of the district heating needs of the Espoo area.
A stable and secure operating environment
A major data center is an investment spanning several decades. As such, companies appreciate a stable and secure operating environment in which political decision-making is predictable far into the future.
It is gratifying that the Finnish state and municipalities welcome new data centers. A good example of this is town planning and permit processes, which proceed smoothly compared to many other competitor countries.
Data center projects also have positive employment effects. These projects create jobs and growth around them, as well as an ecosystem that generates tax income .What is more, they enable district heating produced with recycled, carbon-free energy.
The ecosystem around Microsoft’s new projects could create over 11,000 jobs for IT professionals in Finland in the next few years.
A stable operating environment also includes an infrastructure that runs like a well-oiled machine. Finland and Sweden have good data connections, both internally and externally to other countries. The connections from here to the main telecommunications hubs in Europe are excellent.
Finland and Sweden are also stable from a seismological point of view. There are no earthquakes that can threaten the sensitive systems of data centers.
An abundance of trained employees
Data centers can rest assured that there are trained and reliable employees available in Finland and Sweden. Traditionally, our IT competence is of a high standard. The availability of skilled employees is further strengthened by the fact that universities of applied sciences have established study modules that focus on data center professions.
The more data centers are established, the higher the concentration of expertise in the field. The market intelligence firm IDC estimates that the ecosystem around Microsoft’s new projects could create over 11,000 jobs for IT professionals in Finland in the next few years.
Jari Innanen leads Granlund’s data center business, which is the largest organisation specialising in data center design and consulting in the Nordic countries. The services cover all project stages from selecting the location for a data center to its implementation. Granlund’s data center projects employ over 80 top experts.
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Jari Innanen
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