Summary:
- The shortage of power is driving data centers to move to secondary markets.
- Hyperscalers and AI are increasing power requirements for data facilities.
- Longer build times for data centers due to power industry’s slower pace.
Article:
Power Shortage Driving Data Centers to Secondary Markets
As the demand for data centers continues to grow, the shortage of power has become a major concern for the industry. Many data centers are now moving out of highly congested areas like Northern Virginia and Santa Clara and into secondary markets due to the lack of available power. Power is more accessible in smaller markets, making them more attractive for data center locations.
Increase in Power Requirements
The growth of hyperscalers and the rise of AI technologies are driving up the power requirements of data facilities. This trend is pushing facilities into the multi-megawatt range, posing challenges for the power industry. Unlike the fast-paced IT world, the power industry moves at a slower and more deliberate pace, making it difficult to meet the increasing power demands of data centers.
Longer Build Times for Data Centers
The lead time for equipment and the need for new transmission lines are causing longer build times for new data centers. According to CBRE, the average data center now takes about three years to complete, up from two years in the past. This delay in construction poses a risk of data centers becoming obsolete by the time they are completed, as technology advances rapidly.
Despite the challenges, waiting is not a viable option for customers. The development and construction of data centers must continue, even with shortages of essential resources like concrete, steel, servers, and power transformers. This ongoing demand for data center construction highlights the need for innovative solutions to address power shortages and ensure the efficient operation of data facilities.
By addressing the power shortage issue and exploring alternative solutions, the data center industry can continue to meet the growing demand for data storage and processing capabilities effectively.
