The Free State of Saxony in Germany is considering constructing a new municipal data center.

The facility will be funded by a wider €140 million ($165m) spending package from the federal German government to Saxony, intended to accelerate the digitalization of government services in the state.

Though it released no information on the facility’s size or where it will be located, sources speaking to Dresdner Neueste Nachrichten (DNN) said that the Saxon government is considering the town of Kamenz as a possible site for the new facility.

DCD has approached the Free State of Saxony for comment.

According to DNN, the new data center would grant municipal IT administrators greater independence from commercial providers, support the digitalization of more local government services, and provide a sovereign data storage solution for the free state.

Other options to support these goals include harnessing a decentralized network of servers in existing municipal servers or spreading the cost of any new digital infrastructure by establishing a public-private partnership between the Free State, other municipal governments, and local energy suppliers to build jointly-run data centers.

Initial costs for any one of these options range between €27-€35m ($31m-$41m) – an outlay that would double, said DNN, if provision for the resulting infrastructure’s redundancy is included. An additional €40m ($47m) will be needed to upgrade local networks, cooling and security systems, and the requisite servers. While this outlay will be made by the federal government, Saxony’s attempt to modernize its IT infrastructure comes amid a wider budget crisis for the free state, which is currently grappling with a €2.9 billion ($3.4bn) deficit.

As a power generation hub for Germany, Saxony is an attractive market for data center operators, with municipal authorities receiving up to 200 new requests per month to construct new facilities in the state. Recent examples include a bid to build a 500MW data center by the developer AM:PM Grund Group. Though no operator has yet been announced for the site, up to €6 billion ($6.9bn) could ultimately be invested in its construction.

Kamenz (or Kamjenc) is a town in the district of Bautzen, some 40km northeast of Dresden.

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