Trusted data centres powered by 100% renewable energy with cost certainty to 2032

Google has announced it will invest in 6 - 7 small, modular nuclear reactors to power its data centres in the US. While Singapore – which faces severe resource and carbon constraints – has revealed a “Green Data Centre Roadmap” designed to incentivise the industry to accelerate energy-efficient deployments and increase the use of green energy.

Driving these investments are two pressing priorities for data centre providers – ensuring they have enough power at a reasonable and predictable price to run their data centres 24/7, and accessing renewable energy rather than burning increasing amounts of fossil fuel.

In New Zealand, across Datacom’s network of four data centres, we have two big advantages right now – a source of clean energy that allows us to buy 100% renewable energy to power our data centres (reliant on availability) and at a fixed price that gives our customers cost certainty until 2032.

That price certainty is no small matter. Electricity use represents approximately 20% of the overall costs of running a data centre. That could increase as services like AI models, chatbots and predictive analytics rely on the graphics processing units (GPUs) suited to high-capacity AI workloads.

At Datacom, we have partnered with Mercury in a 10-year deal to secure adequate energy supply for our data centres out to 2032, locking in competitive pricing for the next decade. Energy prices internationally are high and fluctuate regularly. In New Zealand, when we experience dry conditions, it puts pressure on our hydro lakes and we’ve seen businesses hit hard by high electricity spot prices.

Pursuing a fixed-price contract with a maturing date well in the future was all about giving our customers long-term certainty around their data centre-related costs. After two years of grappling with high interest rates and inflation, businesses are in cost containment mode. As they assess what value AI can deliver for their customers, they are also wary of investing in technology that will come with escalating costs.

Our locked-in pricing allows our customers to plan for the future without fear that fluctuating energy prices will play havoc with their budgets.

At the same time, we continue to offer the flexible terms for data centre services in Australasia. Our energy prices may be fixed, but we know our customers' needs can change quickly. That’s why we accommodate them with the ability to increase capacity, decrease capacity or exit our data centres as needed.

We offer incredible certainty for our customers too: we have multiple customers that have been we’ve been serving in our data centres for 15 years – since we opened our Orbit data centre. But, on the flipside, with a standard 90-day agreement, a customer can also exit without having to pay expensive contract break fees.

The hyperscale cloud providers currently building data centres in New Zealand will boost the economy by offering unprecedented access to local hyperscale cloud capacity. We partner with AWS, Google, and Microsoft to help our customers make the most of these public cloud platforms and the powerful tools they offer.

But we also recognise, for many business requirements, the type of data centre colocation and private cloud hosting offered by Datacom is more cost-effective and fit for purpose than operating in the public cloud. That’s why we offer the best of both worlds.

The energy agreements we have in place enable our customers the ability to lower their emissions footprint by running their services and applications on infrastructure that’s powered by 100% renewable energy. Our 10-year deal with Mercury gives us electricity from geothermal, wind, and hydro energy sources.

We also belong to the New Zealand Energy Certificate System which certifies that our energy consumption is matched by renewable generation. These measures are integral to our goal of achieving net-zero carbon emissions by 2030, 20 years ahead of New Zealand's national goal.

It’s not just about renewable energy supply. Every year, we are achieving greater efficiency from our data centres. We cool our facilities with outdoor air to reduce energy consumption associated with temperature control. We are also replacing batteries with new lithium technology and upgrading to energy-efficient lighting.

We focus on sustainability in our procurement processes, offer recycling service onsite and work with suppliers to find ways to do things more efficiently.

New Zealand is blessed to have abundant renewable energy sources. New renewable generation schemes are coming online with more in the pipeline, which will support the electrification of the economy and power the AI revolution.

As we look to the future and invest in our data centres, we are confident that we can offer customers here and from around the world compelling data centre services that are truly sustainable, flexible, and cost-effective.