For some time now there has been talk in the UK about a potential power generation shortage in the country as a number of power stations are decommissioned at the end of their lives without sufficient new generating capacity to take up the slack.
At least five years ago I recall separate conversations on the issue with two IT services company executives working in the utilities sector. One expressed his concerns about the UK’s power outlook, with the expectation that by 2015 we could be experiencing power cuts, while the other categorically reassured me that the UK had enough power for its needs for the foreseeable future. (Around such uncertainty is IT business built).
Anyway, the concerns have not gone away. In an article in The Telegraph last week, Alistair Buchanan, Chief Executive of Ofgem (Office of the Gas and Electricity Markets – the UK power regulator) pointed out that around 10% of the UK’s generating capacity will shut down next month - earlier than expected due to a requirement to meet environmental targets. As a result, within three years, the reserve margin of generation will fall from about 14% to less than 5%. “That is uncomfortably tight”.
The gap may not be filled for some time. There is a lack of investment in wind generation and it’s likely to be another 10 years before any new nuclear generation is available (if then). Gas has to fill the gap, but demand for it is growing worldwide, so even if enough gas can be secured, the price will inevitably go up significantly. It means that energy efficiency will be increasingly important in the UK in the coming years, which will result in renewed focus on green IT.
The ICT sector is a large and growing user of energy. With the growth of internet use, particularly for streaming all forms of video, and the general movement to cloud computing, data centre capacity continues to expand. The power being used by these facilities can easily equate to that required by a small town. The pressure to be more energy efficient will increase as electricity costs go up, but in some locations there may not even be enough spare capacity to accommodate a new data centre.
As a result of Ofgem’s comments there has already been some response from data centre companies, mostly trying to support their own strategy. For example, Rackspace has plans to build a new UK data centre in the next couple of years and TechWeek Europe quotes the company’s technology vice president Nigel Beighton saying “I have total confidence that power will be there.”
By way of contrast, Green Mountain took the opportunity of Buchanan’s comments to point out that it was in the process of powering up its data centre in Stavanger, Norway. The facility has three independent ‘Green’ grid supplies and claims to be a real alternative to the UK power uncertainty. Green Mountain says it has abundant Green renewable power at 40% below the current UK power costs and which can be set at a fixed price for 10 years.
The ICT sector in the UK will no doubt put renewed focus on the power it uses, as much for cost reasons as anything else, in the coming years. But as the Smart 2020/Smarter 2020 reports pointed out, ICT’s largest influence will be in enabling energy efficiencies in other sectors. The Smarter 2020 report was released during the COP18 global climate negotiations in Doha to make just that point. As yet that potential is not being fulfilled. What’s needed is for IT and communications companies to push the case more vocally with governments and their own clients. Not only would they be helping to save the planet, they may also prevent the lights going out in the UK.