This week, China’s Ministry of Industry and Information Technology (MIIT) published a Three Year Plan for data centers. The document mixes Communist Party rhetoric with tech industry buzzwords, promising social revolution through digital transformation.
Guided by “Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era," the plan aims to deliver “5G, industrial Internet, cloud computing, and artificial intelligence,” to the Chinese people.
The politics is different, but the tools are the same. The Chinese Three Year Plan is based on a tiered structure including central data centers, fiber optic networks and Edge facilities. MIIT wants to consolidate data centers, increase their utilization to cut down on surplus capacity, and reduce energy waste by cutting PUE.
China's Plan versus Europe's Pact
That’s somewhat familiar territory - and it’s ambitious. MIIT wants to mandate a PUE of 1.3 for new data centers by 2023, and that’s beyond the only comparable moves being made in the West.
In Europe, data center operators have agreed to a voluntary Climate Neutral Data Center Pact under which they allow themselves two years longer, taking until 2025 to achieve that PUE figure of 1.3.
Take in climate variations and the Chinese action looks even better: while the European scheme will allow operators in warm climates an easier target of 1.4, the Chinese plan sets 1.3 as the baseline and tells operators in colder climates they must go further, reaching 1.25.
Of course, comparisons like this, across political divides, are unreliable. Like many such actions, it’s not clear how far the Chinese plan is aspirational rather than practical - and the same could be said for the European pact.
The Chinese plan is enforced from above, while the European pact is a voluntary deal amongst operators, designed to head off potential restrictions from above.
There are also some striking differences in focus. The European pact commits operators to go carbon free, using 100 percent renewable by 2030 - but the Chinese plan talks only of a “gradual” increase in the use of renewables, with no goals or targets.
That’s completely to be expected, as renewable energy has so much further to go in China. While renewable sources make up 26 percent of China’s electricity, 65 percent comes from coal. In Europe, there’s 34 percent renewable, and the proportion from coal is way down at 13 percent (figures from Europa and NEA).
Big cloud players in China have been castigated by Greenpeace, as none of them seem to have plans for growing their renewable use. And the nation’s data centers are starting from a worse base than Europe.
What about the rest of us?
The really interesting thing is that examples of top-down planning are so rare. The Chinese plan demands that generation keep up with the needs of the data center sector, while Europe has a plan to become a carbon-neutral continent by 2030.
Let’s leave aside for now how practical the European plan is, and note that it won’t happen unless there’s some coordination between power generation and its consumption by data centers and other big users.
Other places, and individual countries within Europe, don’t have that luxury. In the US, new data centers get tax breaks willy nilly, to the extent that every fifth Facebook data center in Utah is essentially free.
Under capitalism, data centers do not have to contribute to renewable generation that matches what they use. Any such action is entirely voluntary. Amazon, Microsoft, and Google can buy generation capacity from their profits, and the world is expected to be duly grateful.
On the surface, data centers are attractive to politicians. Big Tech is clean, it has big profits, and it can talk a far better environmental game than, say, Big Oil. Big Tech can play jurisdictions off against each other - so US states compete for the local business boost and the small tax revenues Big Tech is prepared to pay.
So politicians are much more likely to welcome data centers with tax cuts, than make demands on them. More likely to cut ribbons at their opening ceremonies than to tell them to go elsewhere.
When data centers arrived with an offer to clean up old coal waste in Pennsylvania, US authorities didn't have much choice from the sound of it. There's no plan to get rid of the waste any other way.
Despite this, some local governments have put the brakes on data center development because it simply doesn’t act like a part of a planned ecosystem.
Singapore is a major data center hub, yet it has a moratorium on new projects. Amsterdam finished such a moratorium with a deal under which data centers must share their waste heat. Frankfurt has massive data center development and is tightening regulations around new approvals.
In Ireland, there’s clear evidence that data center building will cause massive demands for electricity, that cannot be easily met from renewable sources. The People Before Profit party has proposed a bill to ban data centers.
It’s unlikely to become law. People Before Profit is a minority party, combining environmental concerns with socialism - and Big Tech is lobbying against it.
But socialists believe in the power of the state. And, when we look at the actions of Communist China, and the idealistic centralizers of Europe - could it be that state power is what data centers need to bring them into line?