Iceland Gets Major Data Center Project

Marketing of Iceland as a data center detination from Verne Global, which this week announced funding for a data center in the island nation.

Marketing of Iceland as a data center detination from Verne Global, which this week announced funding for a data center in the island nation.

After years of marketing itself as an ideal destination for green data centers, Iceland is about to see the completion of its first major new data center project. Verne Holdings announced Friday that the Wellcome Trust had taken an equity position in the company that will fully fund construction of the first phase of a new data center in a former NATO Command Centre in Keflavik, Iceland.

The Wellcome Trust, a medical research charitable foundation based in London with $21 billion of assets, will become the largest shareholder in Verne Holdings, joining existing investors General Catalyst and Novator.

“Large scale customers face a critical need to reduce substantially the power costs and carbon footprints of data centers,” said Dominic Ward from the Wellcome Trust’s Investments Division. “Verne Global is breaking new ground in using Iceland’s natural green resources to mitigate both increasing emissions and rising energy costs.”

Geothermal Power, Free Cooling
Verne Global’s 44 acre data center campus is currently under construction. The facility will be powered entirely by renewable geothermal and hydroelectic energy, and will be able to use fresh air cooling for virtually the entire year, Verne says.

“What makes us unique is that we are able to offer our customers a cost effective, yet truly green solution to their data center needs by providing the benefits of Iceland’s 100 percent free cooling, renewable energy resources and predictable forecasting of energy pricing,” said Jeff Monroe, CEO of Verne Global. “Together, Verne Global and the Wellcome Trust are creating a powerful solution that enables data center users the opportunity to go green without paying a price premium.”

Pitching Iceland’s Advantages
In early 2007 the government of Iceland began been touting the country as an affordable destination for data center development, citing its abundant supply of geothermal power. At the time, we noted that companies considering Iceland “not forget the source of all that geothermal energy: Iceland sits atop an active volcanic rift.”

In 2008 Iceland was hit by an earthquake measuring 6.1 on the Richter scale and became one of the leading casualties of the global financial crisis.
In Feb. 2009 Verne Holdings said construction would be delayed by about 12 months, pushing the launch back to at least mid-2010. This week’s funding announcement puts Verne in position to meet that adjusted timetable.

Targeting LEED Gold
The data center, known as KEF001, is being built in four phases. Customers will have the option of data center pods sized at either 1.2 megawatts or 2.4 megawatts of electric power, and the facility’s location provides direct access to all three of the country’s submarine communications cables. Verne Global is targeting the facility for a Gold-level certification under the LEED ( Leadership in Energy and Environmental Design) standard for energy-efficient data centers.

The Wellcome Trust is an independent charitable trust, established under the will of Sir Henry Wellcome in 1936. The Trust is the second largest biomedical research funding foundation in the world, with a mission to foster and promote research with the aim of improving human and animal health. Registered in England and Wales, it is the largest foundation in the UK by assets, managing a diversified investment portfolio of $21 billion as of Sept. 30.

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About the Author

Rich Miller is the founder and editor at large of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.

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  1. Hehh... That Datacenter is a little under 900 feet from my house. It is however incorrect that this gives it "direct" access to all 3 submarine cables. Farice comes up at Seydisfjordur on the other side of iceland and is probably something like 3-400 miles away. The rest is a bit closer(70-100 miles maybe). Not a big problem as there is a central nation communications hub in Reykjavík just a few miles away but it is hardly "direct access".

  2. What exactly is the seismic stability of Iceland with all the free Geothermal energy?

  3. David Roger

    I'll drive by the site when I'm on the island in June :)

  4. Daniel, Napoli (Italy)

    in Italy some persons put water and wine and similar in the balcony or the window, in the winter. May we consider these a datacenter? :-p

  5. Rodney McKee

    Not that good by the looks of it:

  6. Erlkonig

    I'm from the US, but have been Iceland many times. The spot is great for folks visiting the datacenter. Potential customers of the datacenter and what not. Their international airport is there in Keflavík. And it is only a 15 to 20 minute bus ride into the capital city of Reykjavík. Oh, and don't forget that this area has some of the most interesting/unique landscape and scenery you can find anywhere. Sometimes feels like you are in another world.

  7. We had reservations about this in our original DCK coverage of Iceland's marketing push in 2007. We wrote: "So why isn’t Iceland already overrun with data centers? Let’s not forget the source of all that geothermal energy: Iceland sits atop an active volcanic rift. Cheap power, great connectivity and volcanic eruptions. Some companies operate data centers in Iceland, such as the Reykjavik-based online game EVE Online. But I’m not sure Google’s ready to spend hundreds of millions of dollars to build a server farm atop a volcano." Iceland had a volcanic eruption in 2004 and an earthquake measuring 6.1 on the Richter scale in 2008.

  8. These guys have worked a long time to realize a vision they believed to be viable to the data center community. This is a valiant effort in being able to locate data centers beyond the real estate constraints imposed by lack of traditional utility resources This needs to be more of a focus as we look to new frontiers of developing data centers out of traditional geographic bounders. I do hope they get take full advantage of the geothermal system. I would hate to have to pay the utility after all that effort.

  9. Altaree

    CCP hosts eve-online out of London. But they must have their internal computers somewhere. Don't go messing with their links back to the UK!

  10. For a complete picture of the connectivity in Iceland please retrieve and The Verne facility has fiber provided by Mila and traffic does need to be back hauled via the metro networks to the landing stations. For Rich Miller: Iceland is not overrun with data centers because while the power and cooling situation there is phenomenal, the network situation is not. The costs of capacity from Iceland and the path that eFarice chose to run the Danice cable to the EU is sub-optimal. To me, this announcement underscores Icelands competitiveness as a destination to service compute farms that need a limited amount of Internet capacity.

  11. Thanks, Martin!. Those are great resources for readers seeking to understand the conenctivity situation in Iceland.

  12. Dr. Kervokian: Seismic activity in southern Iceland is common but mild. In the area where this datacenter is you may expect some 5 to 5.5 every few years. Other places in iceland have no activity while some are capable of up to a 7(every few hundred years) but that is as high as it gets. The reason is that we have different plate tectonics as to what you may see in California. We do not have plates coming toward each other but 2 plates moving away from each other. That means that the earthquakes are smaller as there is less pressure. Also all buildings here are built using a very very strict building code so even in the strongest earthquakes you see small damage.

  13. @Rich Miller: The reason for lack of datacenters in Iceland has been because of network connectivity. Until like 10 years ago we only had one submarine cable so network stability was not good enough. The situation has greatly improved now but the cost of bandwidth is still a bit high because of under utilization. Though that may get better now with the first large datacenter. The earthquakes and volcanos are a minor concern. Most people think of Iceland as an island and in their mind islands are small. Iceland is however roughly the size of Kentucky so a volcanic eruption somewhere in the highlands are no threat. It has been hundreds of years since someone has been hurt by a volcanic eruption. These things are hundreds of miles from possible datacenter locations or large populations and the worst we get are some damaged roads.

  14. @Jón Grétar: it sounds like a great place to live, from what I read here and have heard from people who have lived there. Is that true, in your opinion?