The Icemen And The Data Centers

The Icemen And The Data Centers

Iceland has tried before to promote its potential as a site for data centers, and the work data centers do, without a huge amount of success: as a colleague remarked recently `if it is such a good site for data centers why haven’t the big hyperscalers already set up there?’ It is a reasonable question, and there may be at last part of an answer to be found in current affairs – both the immediate and hopefully short term, and the longer and most definitely more permanent.

These affairs are related of course, for one leads directly into the other. Short term there is the energy crisis caused in big part by the war in Ukraine and the consequent shortage of gas and oil for energy production. The current end result of that has, however, been plain to see: a significant upward surge in end user energy prices. For large data center service providers this is now a real point of pain.

In terms of cost management it may even get worse if widely held predictions turn out to be accurate, for a European recession in the very near future is said to be a likely prospect, and a world recession a distinct possibility. For example, the Chinese economy is already close to flat-lining. Coupled with continued inflation there could be a period of what they call `stagflation’, which can be difficult to move on from.

The second issue is climate change, which is likely to have a range of effects on the data centers sector. The most obvious is that rising ambient temperatures will have an impact on the costs of computer room air conditioning. Indeed, a growing number of data centers are likely to require a major shift to water cooling in the near future, particularly as the rising ambient temperatures will couple with the inevitable rising demand for compute resources. Applications are becoming increasingly compute intensive, and therefore more generous in their production of heat.

But there are other areas where climate change has an indirect, but no less important impact on data centers. For example, for many of the users of such services, be that as a full service customer being multi-tenanted or a major enterprise co-locating specific workloads, computing is now seen as an essential raw material, and as such customers now need to know what the carbon footprint and energy ratings are for the raw materials they use, if they are to provide their own customers with accurate information on which to assess their own carbon footprint.

For data centers these footprints are high, and rising. Add in the rising cost of energy and some European datacenters, particularly those with more specialist but heavy compute workloads, are already taking the option of shutting down to save on energy costs and carbon footprints when not running workloads.  

These changing circumstances have prompted the Energy and Green Solutions Section of Business Iceland to launch a new promotional campaign highlighting the way it can help both data center facilities providers and their customers manage down both their costs and their climate impact. This involved meetings and site visits with three Iceland-based data center facilities and service providers – – AtNorth, Verne Global, and Borealis – a communications company specialising in the undersea network cabling required – Farice – and two of the country’s energy providers, representing its two prime sources of energy – OnPower for geo-thermal and Landsvirkjun for hydro-electric.

Many of the workloads currently running in Iceland can be classed as specialist, but even without the increased pressure on cost, sustainability and climate contributions, there are signs that more generalised business applications are starting to find their way there. Computational Fluid Dynamics (CFD) is now the classic specialist application found amongst the Icelandic data centers, not least because of the pattern of compute-heavy workloads – extensive engineering design processing and subsequent analytics, followed by periods of low or zero workload. Here, the time pressure issues found in such applications as real-time trading in financial products and currencies are not found, while the cost and sustainability factors can play a big part.

One of the early customers was car maker, BMW, as Tate Cantrell, CTO a data center service provider, Verne Global, pointed out.

“The reason that they chose us back in in 2012, was that they wanted to prove to the world that not only were they building the next generation of sustainable cars, but they were the first to become aware of data centers as part of the raw materials that made up the cars. They realised they couldn’t end up just relying on their HPC clusters in Munich, because that was not renewable energy.”

The automotive industry was one of the first to invest heavily in CFD as a core part of the design process, but is now a cornerstone for a growing range of engineering and scientific development work, with Universities across Europe now numbered amongst Verne’s customers. They, of course, always have to be budget conscious and have been amongst the first to react to rising costs and adopt the practice of shutting systems rather than carry the cost of them running idle.

The rising costs are now starting to push other users with more traditional workloads to look towards Iceland. That, Cantrell observed, includes banks and other financial houses with the classic overnight batch run workloads that close off the previous day’s trading. Advanced sciences such as Artificial Intelligence applications are also making the move over there. 

“If you’re thinking about billions and billions of combinations of protein folding, I am going to use artificial intelligence to narrow that decision down to 1000 targets. It’s about making better decisions and Iceland is perfectly suited for that.”

Sitting as it does on the growing gap between the North American and Euro-Asian tectonic plates means that the island has abundant, and sustainable, supplies of geo-thermal energy. It is a common observation on the island that, if one sticks pole into the ground, hot water will emerge as a result. Coupled with copious supplies of water providing hydro-electricity, geo-thermal energy  makes it one of the few places on earth able to guarantee 100%, low cost green energy.  But all the data center operators know that this is not enough of a `story’ these days.

So they all make a feature of collecting and promoting as much data as possible to ensure that their GreenHouse Gas (GHG) Protocol targets are amongst the best available. These cover their Scope one, Scope two, and Scope three emissions. Very few elsewhere can provide Scope three emissions data as these are the indirect ones. It is their view that this ability to quote Scope three data is an increasingly important capability as these are the ones that can really demonstrate the idea of global sustainability. As Cantrell observed: “if you’re not keeping track of your third party, indirect emissions, and not informing your customers about those emissions, then we’re all abstracting our impact and the true footprint that we have.”

An interesting by-product of geo-thermal energy production also shows strong signs of making an important contribution to the carbon footprint issue. One of the major suppliers in this sector, OnPower, has been supporting the development of new ways of carbon capture and fixing, with one project showing real promise. This is a partnership between German carbon capture specialist, Climeworks, and OnPower’s new offshoot, Carbfix. The latter has found a way to transport the captured carbon some 2km down into the rock, in the form of carbonated water. It is then pumped through the porous rock at that depth and the carbon combines with the rock permanently.

The test site for the process has a planned capability to lock away some 40,000 tonnes of carbon a year. It is also understood to work with most forms of porous bedrock, so has great potential as an export technology for the island. In addition, it can play a key role in helping businesses demonstrate that they, and their supply chain, are making every effort to offer sustainable services with low carbon footprints.

The additional impact of this is its contribution to future-proofing any user’s infrastructure because, at some point, organisations and enterprises will need to pay tax on the carbon `account’ that they have.

According to Gisli Kr., the Chief Commercial Officer with data center service provider, AtNorth, the current data centre hubs in Europe are our significant contributors to the increasing carbon footprint of the continent, with the prime sources in just the places one would expect to see them: Frankfurt, London, Amsterdam, Paris and Dublin are amongst the highest when it comes to the key metric of carbon output, measured as grammes per KiloWatt/hour.

This is where Iceland has its most obvious advantage, at 10.5 grammes per KiloWatt/hour carbon released to the atmosphere. This compares with Frankfurt at 391g/kwh, London at 275, Amsterdam at 378 and Dublin at 321. Those numbers are all directly related to the fact that the electricity they use comes from fossil fuel-based generation. Paris, at 96 g/kwh, only gets remotely close to Iceland’s numbers because of a high use of nuclear power sources. This all makes for Iceland being able to offer lower operating costs and a lower PUE (Power Usage Effectiveness) ratio. That at 1.2, is reckoned by Kr. to be lower than just about anywhere else, at least in the Northern Hemisphere.

Iceland is, of course, quite a way from all its potential marketplace, be that the UK, mainland Europe, the USA, and especially China and the Far East. Not only the distance, but the environment is a potential hindrance, for connecting to anywhere involves the use of undersea cabling. This is the job that Farice has taken on. The company is a specialist in the provision of high-speed undersea network cabling and already has multiple cables to the UK, France, Denmark, and Sweden, and has recently laid a connection to the USA. There is also a new cable to the UK scheduled to come online in the early part of next year, and plans are in place to connect with China and the Far East.

`Latency’ is the word that should normally come up immediately for every user at this point, for it should be expected the time taken for any message to travel the distances involved would significantly restrict the number and type of workloads it would be worth transporting to Iceland. But the latency expected with the newest UK connection will be under 30 milliseconds for a round trip. This is considered a real game changer by the data center community in Iceland, who now see the country as a nexus of interconnectivity in the mid-Atlantic. It means they can provide sufficient service levels for most if not all applications: the exception being those that require ultra-low latency, such as real time financial trading.

According to Alex Picchietti, Verne Global’s Senior Director of Strategic Alliances, users have become a degree more tolerant of latency issues since the Covid pandemic obliged a lot for people to work from home. “I’d say that a fair assessment, based on them using the correct architecture, is that some 90% – to – 95% of typical applications run in Europe can run here without issue.”

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