Best European Countries for Power Hungry Data Centers

The chart tells us that Ireland despite its low tax rates is quite costly with the highest power rates in the EU. It is often joked that a data centre is a power reseller and there's a lot of truth in that statement. For example, Equinix reports that power and cooling are 80% of its infrastructure operating expense. In general, a data centre's overall operating expense can be as much as 50% electricity. From what I can tell Irish data centre demand for electricity has grown much faster than the country's power capacity. Data centres consume 21% of Ireland's electricity versus 18% for households. This is an astonishing figure. 

High German rates reflect the failed Energiewende. The system costs of wind and solar are extremely high in Germany and both sources are heavily subsidized via guaranteed tariffs because the load factors (annual capacity utilization rates) are very low. For example, a German solar farm only operates at 10% of capacity on an annual basis whereas American nuclear reactors often operate at 100%. In other words, German solar generates very little revenue per dollar spent on capital. Hence above market price guarantees are necessary to induce solar farm investments. Even if wholesale rates turn negative in the summer due to too much solar production, every kilowatt hour of German solar still gets 7 Euro cents. System costs refer to transmission, storage, and back up power costs. Back up costs include capacity reservation payments to keep open coal and natural gas plants in case they are needed to balance the German grid. Both the price guarantee subsidies and capacity reservation payments are recouped via taxes on electricity. It is worth noting that transmission costs are much higher for solar and wind than conventional power sources. 

The cheapest power is in countries blessed with abundant hydro like Sweden, Norway, Finland, and Iceland. Water can also be used for cooling and these countries have low annual temperatures so cooling costs are radically reduced. Combined with educated work forces and lots of cheap land, it is not surprising that AI data centres are increasingly making the Far North their home.