iceland-datacenterIceland has been all in the news in the past year or so. First with the collapse of its financial institutions and then as the home of the volcano responsible for disrupting Northern Europe’s airspace.

Verne Global, a venture-backed data center developer, hopes to make Iceland famous for a third and better reason: as the home of the lowest total cost of operation data center. To some this might seem a little unusual, but to those in the know, this is what brilliant sounds like.

vernegloballogoData centers are a major consumer of electrical energy, representing at least 1.5% of US electrical energy consumption, which may be greater in other markets depending on the need for cooling. Innovations in scaling them and packaging data center functions into a container that can be dropped in place and just plugged in have been discussed in this blog too. And, electrical energy is the greatest ongoing cost element in data center operations. Electrical power is used to drive the servers and electrical energy is used to cool the servers too.

Iceland is an ideal location for data centers because:

  • The electrical power is very inexpensive because 100% of the island’s electrical energy is geothermal or hydroelectric. Totally renewable.
  • Despite being an island in the northern Atlantic, Iceland is caressed by the thermal advantages of the northern branch of the Gulf Stream which generates much of the temperate climate year-round. Verne Global uses 100% free cooling which lowers the total electrical consumption since data center temperature can be regulated by opening or closing various baffles and louvers. There’s no need for power-hungry chillers to cool the air and water servicing the servers. For that reason, the capital cost of the Verne Global infrastructure is therefore lower than a comparably equipped data center on the East Coast of the US or in central Europe which typically requires chilling capacity for at least some of the year, if not all of it.
  • The network joining Iceland to Europe and Iceland to North America is all-glass. Multi-Terabit per seconds of capacity. Multiple, redundant circuits paths.
  • Physical security is well maintained. The company is able to recruit and hire sophisticated, technologically-saavy English-speaking employees for any onsite supervisory and security responsibilities. Since the installation is on a former NATO air base, the separation geographies appropriate for this class of information installation is assured. It’s not on a busy street, major highway or near a dangerous industrial complex for example.

The distance between the East Coast and Iceland (2600 miles) can be the enemy of some applications, but certainly not all. This distance would generate a typical 52 ms round trip (according to NetQoS’ Latency Calculator). Traffic originating in Berlin would travel only 1500 miles to Iceland and so should experience 30 ms round trip delay.

Lowest total cost of operations is the core of the Verne Global competitive advantage. Being energy neutral is the how this cost advantage is achieved. These capabilities are particularly interesting to large financial institutions, pharmaceutical and natural resource companies where large quantities of data need to stored and accessed from time to time, and who all operate or lease data center capacity in major markets, where the cost of operation are so high.

The major Internet service providers (Google, Facebook, Amazon, Apple, Microsoft, Yahoo! to name a few) tend to operate their own data centers and are probably not interested in renting capacity in a center like Verne Global, but maybe they should reconsider. Particularly as they face the burden of accounting for their own global carbon footprint.