Data centre companies in Singapore are waiting with bated breath for the decision that the Singapore government is set to take. Singapore authorities and data centre owners are gathering on the morning of January 27 to discuss lifting of the moratorium placed on data centres.
The government’s decision is tough – on one hand it has to continue to attract hyperscalers or co-location players (in terms of investments). On the other hand, it has to keep one eye on commitments made in Paris Climate Agreement and the UN Framework Convention on Climate Change.
By now, it is widely believed that Singapore is in the forefront when it comes to sustainability. Data centres, one of the largest energy guzzlers are under the spotlight with regard to the amount of energy they consume.
In Singapore, Data Centres account for 7 per cent of the total electricity consumption (3.4TWH) in 2020 and this percentage is estimated to increase to 12 per cent by 2030. Taking cognisance of this, the Singapore government had imposed a “moratorium” on the building of new data centres.
Practically all power in Singapore is natural gas based, which even though is the cleanest fossil fuel, is not a green energy source! Singapore’s mitigation strategy is based on three areas: increasing energy and carbon efficiency, decarbonising the power generation sector and developing low-carbon technologies.
Even in a hypothetical situation where there is no growth in national power consumption, there is still a problem in terms of greenhouse gas abatement, points out Ed Ansett, Co-Founder and Chairman of the i3 Solutions Group. Ed was one of the pioneers of the mission critical facilities industry.
“Given Singapore’s land area and location, many renewable energy types are simply not on the table, either due to ability to scale or geography. Now add in the data centre component, which draws, relative to other industries vast amounts of power from the grid.” Ed Ansett, Co-Founder and Chairman of the i3 Solutions Group
According to industry experts, building data centres will not be the same like in the pre-moratorium days.
“I believe the Government will allow some operators to start building again but not as they did before the moratorium. Certainly, those data centres that do get the go ahead will have to demonstrate a reduced carbon footprint, both in terms of operational and embodied energy, and they will need to be more efficient (PUE, CUE and WUE). I also expect the Government to insist that the naughty data centres, mainly the legacy sites will need to clean their act up. There is plenty of scope for that. But ultimately these are relatively minor improvements, not the complete solution. All these measures won’t counter the GHG abatement problem, but they will prevent it getting much worse.” said Ed Ansett
The overarching solution is probably best achieved by importing renewable energy and initially providing blended hydrogen into the gas grid thereby reducing the CO2e of the fuel mix.
Singapore’s role as a regional data centre hub has driven significant investment in capacity such that Singapore-based servers serve regional needs, not just domestic requirements. As a result, the percentage of utility power consumed by the data centre sector is roughly double (7 per cent) when compared to many countries with a larger domestic base of data centre usage, where the data centre sector typically consumes 3 per cent of grid capacity.
Jonathan Atkin who is the Global Head – Communications Infrastructure at RBC Capital Markets spoke with W.Media via video call.
“There are a number of initiatives afoot around green energy generation, influenced in part by activities in neighbouring jurisdictions in Southeast Asia (Malaysia and Indonesia), which in turn have had an impact on the permitting process in Singapore for new datacenter development.” said Jonathan Atkin, Managing Director at RBC Capital Markets.
In this respect, Singapore has much in common with other global data centre hubs such as Amsterdam and Dublin, where local governments have also increased their scrutiny of the data centre industry, and permitting/approvals in recent years.
As the meeting gets underway, Singapore officials have to decide the next course of action for one of the highly developed and successful free-market economies in the world. This historic meeting may change the course of Singapore’s future in the data center market. The task is onerous to say the least.