UK data centre industry enters new era

Tuesday marked the launch of the first Climate Change Agreement (CCA) for UK data centres and is a significant milestone for the industry, according to CBRE, the global real estate advisor.

The data centre CCA, which has been in planning for four years, is formal recognition by the UK government, via the Department of Energy and Climate Change (DECC), that the sector is a mature industry and significant contributor to the economy which requires its own legislation, and legal framework, to sustain industry growth.

CCAs, first introduced in 2001, are negotiated agreements between government and energy intensive sectors designed to minimise energy consumption through the implementation of energy efficient measures to meet UK’s carbon reduction targets. Prior to today, approximately 50 CCAs were already in operation in the UK covering various sectors.

Emma Fryer, Associate Director of Climate Change Programmes at techUK1, explains the importance of the first data centre CCA.

“CCA participants are incentivised to meet challenging energy efficiency targets via a reduction of, or exclusion from, specific carbon taxes (CCL and CRC). The data centre CCA stipulates that operators will have to make a 30% reduction in non-IT energy consumption between 2011 and 2020 via the implementation of energy efficient measures. As this target is sector specific, focused on colocation data centres, benefit will derive from many sources including reduced energy costs, improved energy stewardship and sector governance, increased investor confidence and ultimately industry competitiveness.”

Today’s introduction of the data centre CCA has changed the competitive landscape helping UK data centre operators to compete more effectively with their overseas counterparts.

Andrew Jay, Executive Director, EMEA Data Centres, at CBRE and Chairman of the Data Centre Council at techUK, commented: “This is a significant and hugely exciting day for the data centre industry. The CCA marks the start of full recognition for a sector that underpins the entire economy but to date has been left unchecked and largely misunderstood by policy makers. We are now legally recognised as key contributors to the UK’s digital economy and an important mainstream sector in our own right. Gaining CCA legislation has been a worthwhile challenge and it is encouraging that the data centre sector now has targets to work towards which should ultimately lead to a better and more energy efficient industry going forward.”