The government in the Netherlands must intervene in the energy market with immediate effect, according to the industry association for data centers in the Netherlands. The 1000% price increase in just one year will affect the competitiveness of energy-intensive companies including data centers and, if this price level continues, their very existence, stated the industry association.
If action is not taken quickly, this would have an immediate negative impact on many industries, including the data center colocation sector, stated industry organization Dutch Data Center Association.
Extreme Rise in Energy Prices
No expert saw the increase in the price of electricity from €30 to €300 per megawatt hour (MWh) coming, according to the Dutch Data Center Association. Whereas other countries around the Netherlands intervene quickly and vigorously and have set ceilings, the Netherlands is relatively aloof while the impact is enormous for energy-intensive companies like data center operators.
“There is a problem now and they cannot be solved with long term contracts and the creation of buffers alone,” said Stijn Grove, Director of industry organization Dutch Data Center Association. “This has a huge impact on colocation data centers across the Netherlands, the majority of which are regional SMEs, which form the digital foundation of the Netherlands.”
“The government needs to start thinking outside the box here, quickly adjusting energy taxes and surcharges and setting price caps,” added Mr. Grove. “At a time when we want more and more control over data, it is wise to strengthen sovereignty and thus support the Dutch digital infrastructure sector in this. Especially in a time of recovery after the covid-19 crisis. It is not wise to let this go any further.”
Data centers directly reduce the energy consumption of IT by concentrating it in one place instead of running it in various small data centers and offices, stated the Dutch Data Center Association. “Research by the International Energy Agency shows that this concentration has ensured that data center energy consumption has barely increased in recent years, while our data use has grown exponentially,” concluded Mr. Grove. “Therefore, it is essential that the government now creates calm in the market.”