451 Research Report - Will Energy Prices Power U.S. Datacenter Growth at Europe's Expense and Short-Circuit Energy Efficiency?

Andy Lawrence, Report Co-Author, Will Lead a Panel Discussion on Datacenter Energy, Efficiency and Economics at HCTS in London, April 9th and 10th.

Mar 18, 2013, 08:00 ET from 451 Research

NEW YORK, March 18, 2013 /PRNewswire/ -- Low and stable electricity prices are likely to make the U.S. a target for datacenter investment at Europe's expense, according to a report published by 451 Research. Lower electricity prices are also expected to impact U.S. investment in energy-efficient technologies.

The reason for this unexpected price stability in the U.S. is its booming shale gas industry. As a result, the energy bill for a medium-sized 2MW datacenter in the U.S. with 50% baseload energy consumption could be as much as $500,000 a year less than a comparable facility in the UK – and about $750,000 less than one in Germany.

Electricity prices in some European countries, particularly Germany, are already twice those in the U.S. and prices have more than doubled in countries such as the UK, France and Germany during the past decade, while they have held mostly flat in the U.S.

The price of power can significantly alter the overall lifetime cost of a datacenter. Assuming a 15-year lifespan, a price of $0.067/kWh contributes about 30% of a facility's operating expense and usually accounts for 10-15% of the total cost of building and running a datacenter. "This figure is large enough to sway decisions about where a datacenter should be built," said Andy Lawrence, Research Vice President, Datacenter Technologies (DCT) & Eco-Efficient IT, 451 Research, who co-authored the report with Rhonda Ascierto, Senior Analyst, 451 Research.

"The effect on datacenter-technology providers is contradictory. The growth of U.S. datacenter activity and investment will boost the market for equipment of all kinds but may limit demand for certain energy-efficient datacenter technologies, especially where there is a trade-off with risk and availability. However, with its higher energy prices, the European market should be more attractive to suppliers of technology that improve datacenter efficiency," Lawrence added.

Andy Lawrence will lead a panel discussion on energy, efficiency and economics at 451 Research's Hosting and Cloud Transformation Summit on April 9th and 10th in London.  Lawrence will be joined on the panel by Ibrahim Chadirichi, Director of Information Management, ARM, and Martin Bradley, Head of European Data Center Engineering and Operations, Morgan Stanley.

About 451 Research
451 Research, a division of The 451 Group, is focused on the business of enterprise IT innovation. The company's analysts provide critical and timely insight into the competitive dynamics of innovation in emerging technology segments. Business value is delivered via daily concise and insightful published research, periodic deeper-dive reports, data tools, market-sizing research, analyst advisory, and conferences and events. Clients of the company – vendor, investor, service-provider and end-user organizations – rely on 451 Research's insight to support both strategic and tactical decision-making. 451 Research is headquartered in New York, with offices in key locations, including London, San Francisco, Washington DC, Boston, Seattle, and Denver.

About The 451 Group

Headquartered in New York, with offices in key locations – including London, Boston, San Francisco, Washington DC, Seattle, Denver, Sao Paulo, Dubai, Singapore and Moscow – The 451 Group owns and operates 451 Research, a leading technology-industry syndicated research and data firm focused on the business of enterprise IT innovation. The 451 Group also owns and operates Uptime Institute, an independent provider of thought leadership, certification, education and professional services for the global datacenter and emerging Digital Infrastructure industry, and Yankee Group, the preeminent research and advisory firm equipping companies to profit in a mobile world.


SOURCE 451 Research