Energy Tax Change Decreases Energy Costs for Data Centers Located in Sweden

Effective January 1, 2017, a new legislation has lowered the energy tax by 97 percent for data center operators with facilities located in Sweden. Based on the new level, the total annual power cost for a 10 megawatt (MW) data center would provide an estimated annual savings of between $1.6 to $2.7 million.

“For data center investors, the new legislation results in a total electricity cost of between $0.035 to $0.045 per kilowatt-hour,” said Rick Abrahamsson, industry expert at Swedish energy company Vattenfall. “This provides a strong business case with a near zero-carbon footprint.”

The new tax level represents a decrease from either $32 (295 SEK) or $22 (199 SEK) per megawatt-hour (MWh), down to $0.55 (5 SEK) per MWh. This is applicable to both existing data centers and new facilities exceeding 500 kilowatts installed IT capacity, excluding cooling facilities. Along with Sweden’s extensive renewable power production, the carbon footprint would be minimal. 

data centers sweden“The energy tax change has made our Swedish data centers even more attractive overnight,” said Niclas Sanfridsson, Equinix managing director for Sweden. “Equinix’s global interconnection platform supports some of the world’s leading businesses. We expect this new tax structure to encourage many of our international customers to make Sweden an integral part of their global IT strategy.”

“We have already seen an increased level of interest in the Swedish market,” said Tomas Sokolnicki, head of data centers at Business Sweden. “Investors are attracted to Sweden’s stable and robust power grid, as well as our extensive fiber network. The dramatically lowered cost of power is the final component data center operators are looking for.”

Business Sweden’s purpose is to help Swedish companies reach their full international potential and foreign companies to invest and expand in Sweden. They offer their customers strategic advice and hands-on support in 50 of the world’s most interesting markets.

Data Centers by Sweden, Business Sweden and the Swedish Embassy are hosting several seminars this month to advise US companies about the new power cost level and provide strategic insight into the Nordic energy market. Data Centers by Sweden is a partnership between selected Swedish regions and corporate partners, offering support around due diligence and site selection for strategic or large-scale data centers.