Lower cost of power reinforces Sweden's data centre strength

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

Thursday, 12th January 2017 Posted 7 years ago in by Phil Alsop

“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.”

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 is minimal.

“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.”

“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 fibre network. The dramatically lowered cost of power is the final component data center operators are looking for.”

Data Centers by Sweden, Business Sweden and the Swedish Embassy are hosting two seminars in Washington DC on Feb. 14, and Silicon Valley, Calif. on Feb. 16, to advise US companies about the new power cost level and provide strategic insight into the Nordic energy market. Vattenfall, one of Europe’s largest generators of electricity, will discuss energy contracts and renewable power production. Attendees will also learn about connectivity and fibre costs from Telia Carrier, one of the largest fibre-optic network owners and operators in the world.