The digital transformation process in which we are immersed gives citizens, organizations and companies endless new development possibilities. In this, data centers play an essential role, which are responsible for providing the necessary infrastructure to house and process the huge volume of critical data, for companies and people, which enable an enormous number of processes. In this context of explosion of the digital economy, Spain seeks to establish itself as the largest data hub in southern Europe, as confirmed by the long list of existing or planned data centers. But this challenge is not without challenges.
One of the most important has to do with an electrical supply that can condition the performance of said centers. That is why it is essential to increase investments to expand and modernize an electrical network that can take on all this increase in activity.
The data center association, SpainDC, has confirmed that the installed capacity in the centers in Madrid has increased its consumption by 47%; which places the city far above other nerve centers, such as Frankfurt, London or Milan. In its report for the period 2023-2026, the employers' association points out that “as a whole, the data center industry in Spain maintains its growth forecasts, which shows the potential and interest of the sector.” However, he adds, the investments “are not assured and their materialization will depend on obtaining administrative authorizations and compliance with the announced investment commitments” due to the deployment of large hyperscale or cloud regions, and also due to the growing direct interconnection between companies.
The increase in demand for digital communications and services is a key element for the progress of societies and industry 4.0, which requires permanent and reliable connectivity. The employers' association expects that the average growth between 2021 and 2026 will multiply by more than four, with an installed power of 466 MW, to meet the constant increase in the internet on a global scale, from the increase in mobile data traffic to new services. of digitization, the internet of things or the displacement of processes and operations in the cloud. There are several reasons that explain the rise of this business in Spain. The first, the country's strategic position as a gateway for data traffic to Europe, from Asia, the Middle East and the Middle East, with the Marea submarine cable, which links the United States with Spain, facilitating transatlantic connectivity.
The extensive fiber optic infrastructure – the largest in Europe – and the availability of land to build centers are other important factors, along with the commitment to achieve carbon neutrality thanks to the generation of renewable energy. But there are two characteristics that could ruin these forecasts: the need to have quick, economical and assured access to energy; and the simplification and acceleration of processes and procedures with public administrations. “The lack of guarantees in the electricity supply and the delay in permits has led to the cancellation or paralysis of some projects,” the consulting firm Colliers points out in a report, which also warns about the threats to Madrid's dream of overtaking important cities like Paris or Amsterdam, if the electrical networks are not expanded and improved and bureaucratic procedures are simplified.
Between 2020 and 2030, the energy consumption of data centers in the European Union is expected to increase by more than 200%. Ireland, one of the key locations, has already confirmed the need for a robust electricity grid, tripling the use of electricity in data centers with figures that represent 14% of the country's consumption in 2022. For its part, Denmark predicts that Energy use in the sector will triple by 2025, representing 7% of total consumption.
In addition, the connection to the electrical grid guarantees that the supply is made with clean energy, something essential in a country like Spain, which aspires to be climate neutral in 2030. Apart from data centers, whose consumption today is around 2% of the country's electrical capacity, a large part of the industry demands an increase in investments in distribution and transportation networks, currently limited by law, to meet the rise of renewables and be able to comply with decarbonization commitments, moving towards an economy digital, green and resilient.
