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Power Generation Mix Key to Powering Data Centers
How can data centers limit their power costs?
Brian Oley, Vice President of Mission Critical Solutions, Jones Lang LaSalle
From a site selection perspective, when looking for the best place to locate or build a data center, there are several ways a data center can limit power costs. First, regulated markets tend to be a little more stable when it comes to a power rates (which are measured in U.S. dollars per kilowatt hour). Rates in regulated utilities are analyzed and adjusted on a less economic, market-oriented structure, and more on a legislative model. This phenomenon ultimately decreases pricing volatility and increases the aggregated accuracy of my financial models created to project the total cost of data center ownership. Second, a data center user can moderate volatility risks and locate low cost power by a simple examination of the generation mix. Generally speaking, there are five primary categories of generation mixes: coal, nuclear, natural gas, hydro, and other (usually consisting of a mix such as petroleum and renewable sources including wind, solar, and/or biomass). The power cost is usually less when a primary component of the mix is hydro. Furthermore, depending on the timing of adopting the given type of generation, nuclear or coal might be more stable, and sometimes a lower cost alternative. It should also be thoroughly examined, however, a data center user’s risk tolerance to the exposure of a mix like coal, given forecasts of cap and trade legislative policies.
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