AMSTERDAM, JULY 25, 2019 – Following the announcement on a temporary pause of new data center construction permits in the municipalities of Amsterdam and Haarlemmermeer, the Dutch Data Center Association (DDA) is invited to contribute to the development of the new policy. This new framework is expected to be defined at the end of 2019. The temporary halt does not have any impact on data center projects that are already ongoing. In this statement we further elaborate on the current status and the right way forward.
On July 12, 2019, the municipalities of Amsterdam and Haarlemmermeer took the preparatory decision to temporarily halt the construction of data centers in their municipalities, due to the pressure of the data center industry on the power infrastructure and urban planning. The DDA stated in an earlier press release that this rigorous decision of the two municipalities came very sudden, as the industry is already very cooperative when it comes to sustainability, energy efficiency and the use of green energy. Together with the Dutch government, concrete plans have been made to secure the future of the Dutch datacenter industry, a very important sector for the Dutch digital economy. The decision of these two municipalities is at odds with the ambitions of the current government to become Europe’s digital leader, according to the trade association.
The impact of the announcement
The announcement raises many questions regarding the direct impact and scope of the preparatory decision. First of all: it has no impact on permits and projects related to data centers in the Amsterdam municipality that are currently ongoing or pending. Furthermore, new projects that are in line with the new policy, where data centers contribute with residual heat and have taken other energy saving and energy efficiency measures, will still be taken into consideration.
Moreover, this temporary halt is not a national one: it only applies to two municipalities: the city of Amsterdam and the Haarlemmermeer area, which includes Hoofddorp and Schiphol. Other regions within the Amsterdam Metropolitan Area (MRA), such as Haarlem, Almere, Aalsmeer and Diemen are not affected, nor is the rest of the Netherlands. The announced halt of construction permits is for a period of one year, until July 2020. The new requirements are expected to be finalized in December 2019, which means there will already be clarity about the way forward in the coming six months.
Having energy consumption as one of the important factors of costs, data centers always had a big incentive to reduce energy consumption and be as efficient as possible. Through economies of scale, data centers have reduced the energy footprint of their operations, making them more efficient than separate on-premise data centers. However, it cannot be denied that datacenters do consume a lot of energy, and put pressure on energy infrastructure that was never designed for these concentrations.
As data centers grow together in clusters, pressure on the power infrastructure grows in all hubs around the world. European datacenter locations in Germany, Ireland, Denmark, United Kingdom and France also experience pressure on their power consumption and infrastructure. The Dutch government, together with the industry, have decided to tackle these issues before they grow bigger; by working together on a National Data Center Strategy and secure the future of the industry. The trade association is already looking at the possibilities of reducing the pressure on the Amsterdam region by moving to other potential locations; a gradual process that requires coordination. This National Data Center Strategy structures the migration towards the areas around Amsterdam (close by, within 30 km), which is clearly communicated in a concrete route map. The decision of the Amsterdam and Haarlemmermeer municipalities contradicts with these plans.
The right way forward
The DDA will be closely involved in the process of drafting up the new regulations: both municipalities have invited the DDA to contribute ideas on behalf of the data center sector on the elaboration of the new policy, which should be finalized by the end of 2019. The objective of the dialogue is a realistic assessment of the location of data centers in Amsterdam and the surrounding area, in the interest of the economy and sustainable development of the city, the digital society and the positions of the Amsterdam data center hub . The assessment will include the necessary aspects such as good spatial integration of data centers, the requirements for sustainability, choice for development areas in relation to availability of energy, the use of residual heat, efficient use of energy and agreements on energy performance.
The DDA responds positively to the invitation from the municipalities. It does, however, state that it has doubts about the non-constructive manner in which policies are currently being made in contrast to the measures that the sector has been taking for years. “As a sector, we have specifically encouraged the regional governments to take serious action upon the use of residual heat and it comes down to waiting for the government in almost all challenging residual heat projects. In times when we can accelerate, a restrictive government measure like this is counterproductive and these projects are negatively affected by it. ”The trade association therefore asks the municipalities to be more proactive and supportive with the initiatives of the sector.