The energy crisis and the telecom sector

Some of the largest telecom operators in Europe have banded together to encourage Big Tech organisations to share network costs. The companies, including Orange, Telefonica, and Deutsche Telekom, have cited the ongoing energy crisis in Europe as the primary driver in this push. An unprecedented collaboration in a competitive industry: how did we get here?

What is the European energy crisis?

Caused in part by the ongoing war in Ukraine, and Russia’s weaponisation of its gas pipelines, supplies are expensive and running low across the continent—causing anxiety for both households and businesses. The increasing cost of power has already broken records, briefly rising above $1000 per megawatt hour in Germany, causing one senior analyst at Rystad Energy, Fabian Rønningen, to declare, “These prices are reaching levels now that we thought we would never see.”

Measures are already being put in place to reduce the impact of shortages, for example central heating will be limited in Italy, whilst Portugal has already placed limits on Christmas lights this year in a bid to use less electricity. From a commercial perspective, industries heavily reliant on huge amounts of power are, understandably, incredibly concerned about the months ahead. Telecom operators are amongst those raising their concerns. 

How is the energy crisis affecting telecom operators?

Data centres use huge amounts of energy and water to power and cool their computational elements, and it will only increase in the coming years as HPC workloads demand more energy. By 2030, data centres are projected to account for 3.2% of electricity demand within the EU, an 18.5% jump from 2018. 

With these figures in mind, it’s easy to understand operators’ rising anxiety surrounding the energy crisis. Some data centre operators have started to stockpile generator fuel in anticipation of worsening shortages. As global data centre energy usage sits at around 200-250 terawatt-hours of electricity per year, contingency plans such as this are vital for critical, energy-intensive infrastructure to avoid service interruptions. 

Climate change is also having an impact

Energy prices and availability are not the only difficulty telecom operators are having to contend with recently. When the UK experienced record high temperatures in late July, Google Cloud’s data centres in London went offline for a day, due to cooling failures. Outages limited customers’ access to key Google services for hours. Oracle’s cloud-based data centre in the capital was also struck down by the heat, causing outages for US customers. These unseasonable temperatures were blamed for the blackout. This represents another difficulty operators have to content with in tumultuous times.

Conclusion

Businesses and telecom operators face vastly rising operational costs, and worse, limited availability of mission critical power. Though global events may be out of control, enterprises can lessen the burden by seeking solutions which are built upon shared infrastructure and mutual interconnection. Get in touch with us to find out more.