Digital infrastructure operations face increased scrutiny by local, national, and transnational authorities on financial and operational fronts. Financial reporting requirements are being expanded to include climate disclosure requirements – reporting of greenhouse gas (GHG) emissions and reduction goals and the financial implications of risks and opportunities – in countries around the globe.
Municipal, state, and provisional governments are establishing siting, energy and water use restrictions on new datacentres to manage and mitigate the explosive growth of server farm campuses in areas of high concentration, such as Virginia in the United States; Amsterdam, Netherlands; and Singapore.
Local and national governments are initiating broad energy efficiency requirements that bear upon datacentre operations – sometimes adding specific mandates.
A clear indication of the future direction of datacentre regulation is the amendments to the European Union (EU) Energy Efficiency Directive (EED), which are in the final stages of approval by the EU Parliament.
The amendments require enterprises that consume more than 23,700 megawatt hours (MWh) per year, a level exceeded by most enterprises with significant datacentre operations, to maintain an energy management system (EMS), perform periodic energy audits, and publicly report a ‘concrete and feasible’ action plan with progress.
Individual datacentre facilities with over 500 kilowatts (kw) of installed IT equipment (nameplate power values) must report operational data and metrics. The Directive also signals the intent of the EU to establish minimum efficiency thresholds for work per energy use metrics in the future.
Historically, datacentre operations have primarily operated outside of any regulatory framework except local siting and zoning restrictions. As regulations such as the EU Directive propagate, digital infrastructure managers must ask themselves, ‘How do we achieve an effective compliance posture?’
To deal with the operational intrusion of regulations, managers must dedicate staff and resources and establish networks, business processes, and energy efficiency project and carbon free energy (CFE) procurement plans to anticipate, influence, and manage emerging legislation and regulation.
Managing staff for regulatory reasons
Staff members need to be assigned responsibility for anticipating and managing regulatory requirements. It is essential to have an identified position or group, often within the legal department or corporate staff to track and manage regulatory requirements.
As necessary, this group must directly or indirectly engage in the legislative or regulatory development process to influence outcomes to maintain the operational flexibility and innovation the industry leverages to do more work per MWh.
They need to have a close working relationship with regional or facilities operations staff, as they understand the facility or system-level implications of governmental mandates. They can assess the availability or lack of the data and business processes needed to measure results and demonstrate compliance. Senior staff members and managers with experience across facilities and IT operations are best positioned to fulfill this role. Junior staff members from both facilities and IT groups should be involved to develop expertise, broaden their view of the total operation, and bring different viewpoints into the discussion of achieving compliance.
Employees that are responsible for regulatory compliance must understand that words matter, compliance requirements must be integrated into operational processes, and aggressive monitoring and verification are a critical component of a regulatory compliance process.
Digital Infrastructure teams must build networks that enable them to anticipate, influence, and comply with regulatory mandates. They must subscribe to one or more regulatory tracking services and manage and maintain internal and external networks with groups such as government affairs and industry associations to identify proposed and finalized regulations that affect operations. As legislation and regulation typically take one to three years to move from proposal to law, the service should cover both proposed and finalised mandates.
Industry associations are an excellent resource for tracking and influencing requirements, and it is wise to maintain membership in organisations that demonstrate effective working relationships with legislators and regulators. The most effective associations seek to understand the underlying purpose of a given legislative or regulatory proposal and offer options that meet the proposal’s primary intent while maximising operational flexibility and minimising the cost of achieving compliance.
Industry trade publications and other reputable national and international newsfeeds are sources of information on regulatory developments and public issues affecting datacentre operations. Good coverage can typically be achieved with five to ten high quality daily and weekly subscriptions, many of which are free.
Effective operations, monitoring, and data collection processes will be critical to comply with emerging legislative and regulatory mandates. Well-managed processes, procedures, and data collection and reporting systems are needed to provide a foundation to meet compliance commitments.
Existing IT and facilities operational and data collection processes likely address 70-90% of the data required to support regulator reporting. Managers will need to make investments to collect missing data, improve and ensure data quality, move all the required data into a central data warehouse, and create the dashboard(s) and report(s) to track regulatory compliance and improve operational metrics tracking.
Compliance requirements will force many datacentre managers to reassess the value of Data Center Infrastructure Management (DCIM) software. The cost and effort of installing and managing a DCIM system have slowed their adoption. A DCIM system supports business processes critical to ensuring compliance and collecting the IT and facilities operational data that will be needed to generate work per MWh metrics. The challenges of managing and tracking compliance data and the reputational and financial implications of non-compliance will likely cement the business case for using a DCIM system.
While the final form of future regulations cannot be predicted today, managers can position their organisation for regulatory success by developing and implementing an energy efficiency project plan and carbon-free energy procurement plan for their facility or their enterprise.
These two plans should increase the work per MWh and reduce the MT CO2 per MWh for each datacentre facility and the enterprise.
The IT and facilities managers jointly own the energy efficiency project plan. On the facilities side, clear objectives should be established to maximise the cooling efficiency ratio (the cooling energy delivered per unit of energy consumed) and reduce the power usage effectiveness (PUE).
The two organisations must collaborate to increase the IT equipment inlet temperatures in the IT space. The IT organisation must increase the utilisation of their IT equipment, reduce equipment counts by 25% to 50% on equipment refresh, and implement power management functions where workloads allow.
A comprehensive plan will likely take five to eight years to implement. The sooner an organisation embarks on this effort, the sooner it can reap business and environmental performance benefits and position individual facilities for compliance with future regulations.
Datacentre managers must build a carbon-free energy plan to reduce the operational carbon emissions. Like the energy efficiency plan, the clean energy procurement plan will have an implementation timeline of five to eight years.
It must be periodically refreshed to capture the benefit of new technologies and contract types. Each facility should have a procurement plan with a timeline based on the availability of carbon-fee energy in the grid region supplying the facility. This plan is the responsibility of the energy procurement team but requires the support of the facilities and IT operations teams. It is vital to begin working on these plans today.
Compliance with legislative and regulatory requirements represents new challenges to datacentre managers. Business and data collection processes and operational performance will be subject to public scrutiny in a regulatory environment. Failure to conform with mandates or the report of mediocre performance levels represents a reputational and financial risk to the business.
There are concrete steps that managers can take now on their staffing, business and data collection processes, and environmental performance to position themselves for success in a regulatory compliance environment.