Reliable Power: The Foundation Of Data Centre Services – The Cost Of Diesel Back-up Power For Data Centres

Diesel generators are the standard back-up power solution for data centres in Norway. The cost is significant, both commercially and environmentally. With these costs increasingly in focus, more sustainable alternatives are now emerging.

Uptime is a key deliverable in data centre service level agreements. A breach by the service provider typically leads to significant deductions from the agreed remuneration. To achieve uninterrupted power supply, redundancy is essential. In Norway, power redundancy normally involves diesel generators. This comes at a significant cost, both environmental and commercial. Some service providers are seeking to mitigate the conventional reliance on diesel generators by deploying more sustainable solutions.

Tier Classifications: Uptime

The Uptime Institute operates with the following classification of data centre tiers:

Globally, Tier III is the most common standard. The Uptime Institute defines this level as “N+1” redundancy. In Norway, the primary power supply – the “N” – is drawn from the national power grid. This is in contrast to other parts of the world, where “behind the meter” power generation, supplying electricity directly to the data centre, is a growing trend. The back-up system typically consists of several components. A UPS (Uninterruptible Power Supply) can activate immediately and bridge the gap for a few minutes, but an additional power source that lasts longer (higher energy density) is needed to sustain operations for hours. This is where the diesel generator comes in.

The diesel back-up: scale and cost

Diesel back-up systems consist of modular units, each typically rated at 2–4 MW, roughly the size of a train carriage. At a rough estimate of approximately EUR 1,000 per kW of generator capacity, the capital expenditure for a 100 MW facility amounts to EUR 100 million. Monthly and annual testing, and fuel storage, add operational costs. In addition comes the cost of actual fuel consumption during outages. The land required for diesel installations is another significant factor, both in terms of acquisition cost and the possible opportunity cost of reduced data centre capacity due to land use.

From a regulatory perspective, a data centre will require a pollution permit regardless of whether it has diesel back-up, for example due to noise, water discharge or ground works. Prior to building and commencement of operations, a permit must be obtained from the State Administrator.

Notably, under the Norwegian Pollution Regulations (forurensningsforskriften), a key threshold applies: emergency power generators are exempt from the standard emission limit values for SO₂, NOx, and CO, provided they operate for no more than 500 hours per year. Operating hours are calculated as a rolling average over a three-year period. According to the Norwegian Environment Agency, this threshold applies to the facility as a whole – the entire installation is considered to be in operation if at least one individual combustion unit is running.

Batteries could become a key part of tomorrow's data centres – supporting back-up power while also opening the door to new revenue in the balancing markets.

Foto: Getty Images/Johner RF

Towards more sustainable solutions

In our experience, there is a trend towards more sustainable alternatives to conventional diesel back-up. One option is selecting a more sustainable fuel source. Combining back-up generation with BESS (Battery Energy Storage System) is, for instance, an emerging possibility, which may also enable participation in the profitable power balancing markets. Reducing the required hours of diesel back-up is another pathway, achievable through “load shifting” – either temporal shifting, where the execution of incoming workloads is delayed, or spatial shifting, where workloads are moved between data centres. The latter is particularly interesting to monitor as the number of data centres continues to grow, and one could foresee redundancy being achieved at the scale of multiple campuses, rather than solely within a single site. This is again linked to the tier classifications, which may be a requirement in the SLA. The feasibility of load shifting, as well as the need for redundancy, depends on the nature of the customer’s workload and the service provider’s own infrastructure and capabilities. Wikborg Rein follows these developments closely.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.