Landsvirkjun

Iceland: Outstanding location for Data Centers

5. July 2007

Iceland can offer clean, renewable energy at a very competitive price and the study showed that Iceland offers lower cost for Data Centers than USA, UK and even India. This makes Iceland a very attractive location for Data Centers, and even more so if taken into account the fact that the need for cooling is substantially less in Iceland, due to a cooler climate, and that the energy in Iceland is renewable. Studies have shown that half of the energy cost of a Data Center is for cooling, making Iceland an even more ideal location. Furthermore, Iceland provides only hydro-electric and/or geo-thermal energy, which is renewable and therefore environmentally friendly, does not contribute to global warming, and requires no carbon credits.

Icelandic telecommunications and software companies have, in recent visits with international companies, proven their unequivocal ability to undertake the task of international cooperation and service to whomever wishes to utilize this untapped opportunity.

Iceland did not score as high as USA or UK for “quality”. This was mainly because of lack of variety in secure connections to Europe and USA. This has already been addressed. The Government stated in their Policy Declaration that a new telecommunications cable will be installed in 2008 and the Minister of Communications, Transport and Tourism was quoted on June 22nd, saying: “The board of Farice has decided to auction off the research and installment of the cable this fall, so that a new cable will be operational come fall 2008”.

Another thing that contributed to a lesser score is that Iceland is perceived to have high natural disaster risk and is the land of ice and fire in the minds of many. Although this is partially true, fact remains that the risk of natural disaster is considerably lower in Iceland than in the USA, UK or India.

The study was conducted by PwC for Invest in Iceland Acency in association with Teymi, Hitaveita Suðurnesja, Orkuveita Reykjavíkur, Farice, Siminn, and Landsvirkjun.

Further Information: Gunnar Örn Gunnarsson, Head of Business Development (gunnargu@lv.is).

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