Short Reads

Increasing control of data centre locations

Increasing control of data centre locations

Increasing control of data centre locations

26.08.2021 NL law

Due to the impact of the booming data centre market, Dutch municipalities and provinces adopt data centre policies and umbrella zoning plans to regulate data centre locations. In Amsterdam and Haarlemmermeer in particular, the growth of the data centre ecosystem therefore appears to be coming to a halt.

The data centre market is booming, according to a recent report from global commercial real estate services company JLL. Due to developments including cloud computing, streaming and 5G, there is a great demand for new data centres. In the Metropolitan Area of Amsterdam (Metropool Regio Amsterdam, MRA), a large cluster of data centres has arisen due to the favourable geographical location of the Netherlands within Europe, the large number of available sea cables, and the Amsterdam Internet Exchange (AMS-IX), one of the largest internet hubs in the world. In addition, the high availability of sustainable energy contributes to the establishment of hyperscale data centres in, for instance, the Eemshaven area in the north part of the Netherlands, and in Middenmeer, to the north of Amsterdam.

However, the increasing number of data centres also has an impact on the landscape and on energy infrastructure. For this reason, the municipality of Amsterdam has adopted a data centre policy, the municipality of Haarlemmermeer has adopted a data centre policy and an umbrella zoning plan (paraplubestemmingsplan), and the province of Noord-Holland has drawn up a draft data centre policy in order to regulate locations for data centres. We discuss these documents in this blog.

Data centres in the Netherlands

Data centres provide power, connectivity, cooling and security. The IT facilities (servers) usually belong to the data centre’s customers. In 2020, according to the Dutch Datacenter Association, the trade association for data centres, there were approximately 189 commercial multi-tenant data centres in the Netherlands, and 5,772 organisations that have their own data centres. There are currently two locations with hyperscale data centres in the Netherlands (Eemshaven and Middenmeer) and there is talk of possibly setting up a third in the Zeewolde region (see link, under answer to question 5).

Data centres are often divided into four categories:

  1. International co-location/multi-tenant data centres
    These house the servers of a large number of customers active on the international or global market. Hyper-connectivity is of great importance to these data centres, and is accomplished by creating a cluster of data centres with a high density of connections between the servers, or where there is direct access to AMS-IX or the international fibre optic cables. This results in very fast connections and therefore a very low latency (i.e. response time). There are three hyper-connectivity clusters in the MRA (Amsterdam Science Park, Amsterdam Southeast and Schiphol-Rijk). Outside of the MRA there is no other hyper-connectivity cluster in the Netherlands.
     
  2. National colocation/multi-tenant data centres
    These house servers for a large number of customers active on the national and regional market and are located throughout the Netherlands.
     
  3. Hyper-scale data centres
    These are very large, and are for own use. For this type of data centre, the price of land, possibilities for expansion, and availability of sustainable electricity are key considerations. This also applies to low latency, but to a lower extent than for international co-location/multi-tenant data centres. This makes it possible for hyper-scales to be located at a greater distance from AMS-IX.
     
  4. Edge data centres
    These are smaller data centres, located relatively close to users. They are increasingly important for 5G and Internet of Things (IOT) applications and for streaming services where latency must be as low as possible for users. They typically connect to one or more decentralised data centre(s).

Policy: NOVI and Spatial Strategy Data Centres 2030

The National Spatial Strategy (Nationale Omgevingsvisie, "NOVI") concerns national policy for the physical living environment and contains a number of policy decisions. Policy decision number 2.6 relates to data centres and is broadly based on the Spatial Strategy for Data Centres 2030. The policy decision entails that, in collaboration with other government authorities, network operators and the business community, the government will focus on the rollout of new networks and the selective growth of data centres for the digitalisation of the economy. Based on this, data centres can be established where:

  1. energy demand can be sustainably met via current or future energy networks. This calls for a good alignment of supply and demand; and
  2. there are possibilities to supply waste heat to heat networks in urban areas; and
  3. the requirements for digital connectivity that are set by players on the market can be met.


The government's efforts are aimed at facilitating co-location in the MRA for data centres for which hyper-connectivity is an important location requirement. Exploration of developments towards Almere and South Holland are logical next steps for these co-location data centres. Hyper-scale data centres can be established at locations where there is a large supply of (renewable) electricity, where connections to the electricity grid can be provided, and where space is less scarce. The preferred location is on the fringes of the Netherlands, such as at the existing locations of Eemshaven and Middenmeer. 

Data centres and zoning plans

Data centres are usually classified in a relatively low environmental category (category 2), because the impact of a data centre on the immediate environment is limited.  Therefore, data centres are usually permitted within regular business zones. This means that a building permit for a data centre in a business zone may not be refused if the building regulations are also met.

Therefore, the possibility to influence the locations where data centres are established requires customised zoning for data centres within the broader business zone (comparable to regulating supermarkets within the broader retail zone).

The municipalities of Haarlemmermeer and Amsterdam and the province of North Holland guide the establishment and locations of data centres

In the province of North Holland, where most data centres are located, governmental guidance on data centres has been issued. The municipalities of Haarlemmermeer and Amsterdam are leading the way in this respect.

Both municipalities took a preparatory decision for the establishment of data centres in 2019 (for more information, see this blog post) and then developed a data centre policy, which can be accessed here for Haarlemmermeer and here for Amsterdam. The municipal council of Haarlemmermeer subsequently adopted the Umbrella Plan Data Centres (NL.IMRO.0394.BPGhlmdatacentres0-C001) and the Management Regulation (beheersverordening) Data Centres (NL.IMRO.0394.BHVlgbdatacentres0-C001) (jointly referred to as: the Umbrella Zoning Plan). Amsterdam has not adopted an umbrella plan for data centres – yet.

Situation in Haarlemmermeer

Haarlemmermeer's data centre policy provides for moderate growth and concentration of data centres up to 2030 with 550 megavolt amperes (MVA). This is an addition to other data centres for which environmental permits have already been requested. After 2030, no additional space will be available for data centres in Haarlemmermeer. Haarlemmermeer has chosen to allow data centres only at specific business parks (Polanenpark, Schiphol-Rijk, Schiphol Trade Park (STP) and Corneliahoeve) and not in residential areas or the countryside. The policy imposes strict conditions on the establishment of data centres. These conditions relate to spatial quality and landscape integration (landschappelijke inpassing), energy use and sustainability of data centres.

A number of aspects of the data centre policy are regulated in the umbrella zoning plan. The data centre policy is implemented in two steps. The first step is the Umbrella Zoning Plan. This sets out the first group of important spatial elements for new data centres or for the expansion of existing data centres. Under these conditions in the coming years, it will remain possible to realise a new data centre if the current zoning plans would already permit this. These conditions are as follows:

  1. Connection to an energy network: a new data centre may only be put into operation if it is connected to an energy network with sufficient capacity and if written advice has been obtained from the network operator in advance.
  2. Maximum connection capacity of electricity: the Umbrella Plan limits the total connection capacity of new data centres to 550 MVA (excluding a number of data centres for which applications for environmental permits have been submitted).
  3. Own procurement station: data centres with a connection capacity greater than 80 MVA must have a 150 kV procurement station on their own premises.
  4. Pavement: in the interest of good water management and to stimulate a green approach, it has also been stipulated in the Umbrella Zoning Plan that 75% of the unbuilt area must be unpaved, with a minimum of 250 m2, and that the unpaved areas must be integrated in the landscape.
  5. Landscape integration: the use of land for a new data centre is only permitted if, within two years after an environmental permit for building a new data centre becomes irrevocable, the unpaved grounds are integrated in the landscape.


The definition of a data centre in the Umbrella Zoning Plan is "a company which is principally concerned with the digital storage and processing of information on computers (servers)". However, this definition seems more applicable to the customer of a data centre, who places his servers there, than to the owner/operator of a data centre who 'only' provides power, connectivity, cooling, and security.

What is also striking is that no minimum capacity is required for the application of the Umbrella Zoning Plan. This is different for the Amsterdam and North Holland (draft) data centre policies (discussed below), which solely apply to data centres with a capacity of 5 MVA and upwards.

The second step is to ensure that, in a few years’ time, the data centre policy of Haarlemmermeer will be fully secured in zoning laws and regulations, by designating a number of specific areas where data centres will remain allowed. For the rest of the municipal territory, new data centres will no longer be permitted. The growth of data centres can continue in the designated areas. Further guidance is provided by including surface provisions (oppervlaktebepalingen) for new data centres and expansions of existing data centres for each of these areas at a later date. This leaves room for other forms of business activity within the municipality of Haarlemmermeer.

Situation in Amsterdam

The preparatory decision in Amsterdam expired on 31 July 2020. Currently, no 'strict' spatial regime exists specifically for data centres within the municipality of Amsterdam. On December 17, 2020, the municipality of Amsterdam adopted the policy "Amsterdam Duurzaam Digitaal,Vestigingsbeleid datacentres gemeente Amsterdam 2020 - 2030", which contains more guidance on the establishment and possible locations of data centres.  

As the Amsterdam municipal council has not adopted an umbrella zoning plan for data centres, the municipal executive cannot use urban planning to control the establishment and expansion of data centres that are in accordance with the respective zoning plans. Control then takes place through lease agreements (provided that the municipality owns the land) and - in the case of conflict with the zoning plan - through good spatial planning (goede ruimtelijke ordening). Under the upcoming Environment and Planning Act (Omgevingswet) this will involve a balanced allocation of functions to locations.

The data centre policy of Amsterdam is not only aimed at maximising growth, but also at making data centres more sustainable. The main points of the Amsterdam policy are:

  1. Facilitating growth: maximum increase of 670 MVA until 2030.
  2. Maximising growth: maximum annual growth of 67 MVA.
  3. Facilitating known projects and initiatives until at least 2025: the known projects and initiatives within the municipality of Amsterdam provide for the facilitation of market demand until at least 2025. For this reason, the municipality will not cooperate with new initiatives unless they are aimed at realisation after 2025.
  4. Spatial spread: the municipality aims to spread the data centres across the current clusters. These are Science Park, Amstel III - West business strip, Port / Port City and parts of Schinkelkwartier.
  5. Intensive use of space: data centre buildings may only be built in an ‘intensively stacked’ way, whereby the height appropriate for the area can be determined in consultation with the municipality. Construction underground also fits in with intensive use of land. Where technology allows it and the space can be combined with other users, underground construction of a data centre is encouraged.
  6. Spatial integration and quality: when assessing the spatial design, consideration is given to the building’s relationship with its surroundings, the building volume, the plinth, the public programme and the options for transformation. Another important precondition is the existence of sufficient room in the subsoil for the 10 or 20 kV cables.
  7. Mixed use of space: A data centre is not a function that is restricted to the ground floor. Combining data centres with functions that do benefit from a location on the ground floor (catering, business spaces, logistics centre or other public facilities) results in more intensive use of space and improves the image at street level.
  8. Power of the contracted capacity: the possible growth of data centres after 2025 has been laid down in the frameworks for the expansion of the network, provided the municipality and Liander succeed in realising the necessary substations in Amsterdam. In the Amstel III sub-area, the possibility is being studied of connecting the existing data centres directly to Tennet's high-voltage network, thus relieving Liander's network of this burden. As in Haarlemmermeer, the basic principle for new initiatives is that data centres with a capacity exceeding 80 MVA must install their own 150 kV purchasing station.
  9. Energy saving: this is discussed in more detail below.
  10. The compulsory use of residual heat: it is compulsory to use residual heat from a data centre by realising a proper technical connection (uitkoppeling) for residual heat at the plot boundary for new data centres and, if technically possible, for the expansion of existing data centres. See point 4 below for more details.
  11. Commit to sustainably generated energy: sustainable electricity generated from plots of land (the use of roofs and facades for solar panels and fossil-free systems for emergency and peak systems) and the purchase of sustainable electricity (the data centre sector is a front-runner in the procurement of sustainable energy).
  12. Future-proof circular construction: efforts are being made to ensure future-proof (circular) construction that fits in with the spatial framework established for the business site in question.

Special attention to energy saving and sustainability in Amsterdam

The municipality of Amsterdam wants initiators of data centres within the municipality to confirm the municipal ambitions (contractually) and to work with the municipality to achieve an implementation that benefits the municipality. Therefore, sustainability is an important criterion in obtaining permission to build a data centre. The data centre policy includes the following elements relating to sustainability:

  1. LEAP: the Amsterdam Economic Board, NLdigital, Green IT Amsterdam, the Netherlands Enterprise Agency (Rijksdienst voor Ondernemend Nederland) and the Environment and Planning Agency (Omgevingsdienst) Noordzeekanaalgebied have launched the Low Energy Acceleration Program (LEAP). In collaboration with major customers, data centres, hardware suppliers, research institutes and governments, the LEAP will work on increasing the energy efficiency of servers and working towards a sustainable digital infrastructure. Investigations are ongoing into how the results from the LEAP project can be anchored in specific regulations.
  2. PUE < 1.2: the Power Usage Effectiveness (PUE) is the value of the total energy consumption divided by the amount of energy used by the IT equipment. The more efficient the cooling and electricity distribution of the equipment is, the more energy-efficient the data centre is and the lower the PUE will be. The draft PUE must be below 1.2. The possible negative impact of sustainability measures, such as supplying residual heat, has to be taken into account when looking at this value, because it may have a negative impact on the PUE. The Minister of Economic Affairs and Climate Policy has informed the House of Representatives (Tweede Kamer) that no national requirements will be set for the PUE factor for the time being (see the reply to parliamentary questions on energy saving in data centres).
  3. EPC: the Energy Performance Coefficient (EPC) (now: BENG) is an index that indicates the energy efficiency of new buildings. For any 'Building Decree functions' (such as offices) which are part of the data centre, an EPC must be achieved that is consistent with Amsterdam's policy of energy-neutral construction.
  4. Use of residual heat: the compulsory use of residual heat from a data centre at a set temperature by realising the technical connection (uitkoppeling) for residual heat at the plot boundary and by incorporating the technical connection (uitkoppeling) for residual heat and the recovery of cooling into the design of the data centre with a heat/cold storage facility. Agreements about the use of residual heat must be laid down in contracts between the developer, the data centre and the heat operator. The municipality's role is primarily that of a facilitator, directing the creation of local or other heat networks. Nevertheless, there are still many hurdles to be overcome in the use of residual heat, and it is not helpful that the proposed legislation for a Collective Heat Supply Act (Warmtewet 2) has recently been put on hold (link). This bill stimulated the use of residual heat in the built environment in a societal cost-effective way by giving heat companies the right to 'collect' residual heat from an industrial company, data centre or other producer of residual heat, against connection costs (uitkoppelkosten). For the time being, the cooling of medium groundwater is prohibited, so data centres have to rely on drinking water for cooling.
  5. Reducing drinking water consumption: Waternet, the municipal water company, is aware of the short- and medium-term data centre projects in Amsterdam. The short-term projects fit within the existing space of drinking water production capacity. Waternet will assess future requests from data centres for drinking water connections on a case-by-case basis, based on the criterion that the amount of drinking water required for cooling is drastically reduced.

Data centre strategy for North Holland

In July 2021, the provincial executive (gedeputeerde staten) of North Holland adopted the draft North Holland Data Center Strategy (link), of which an English translation can be found here. This draft may change after consultation with stakeholders. At the end of 2021, the provincial council will adopt the final provincial data centre strategy (link).

The provincial data centre strategy applies to data centres with a surface area of more than 2,000m2 and an electricity connection of at least 5 MVA.

The provincial data centre strategy focuses primarily on the establishment of new data centres. The 57 existing large data centres in the province (55 co-location/multi-tenant data centres and 2 hyper-scale data centres) remain largely unaffected.

The provincial data centre strategy aims to guide through regulation and stimulation. Regulation takes place through setting rules in the Environmental Regulations (Omgevingsverordening) that affect municipalities, such as siting conditions that are already applied in Amsterdam and Haarlemmermeer. Stimulation relates to initiatives from the sector itself, for example, supporting knowledge development, lobbying, collaboration, innovation and providing information, and making agreements on this with public and private partners.

In summary, the provincial commitment amounts to the following, whereby the Data Centre Strategy makes a distinction between space and sustainability:

Data centre strategy: space

This theme covers choices for locations and clustering, the integration of data centres and the use of space:

  • Rules in the Environmental Regulation
    • Choice of designated business sites in Amsterdam, Haarlemmermeer, Diemen and Hollands Kroon and a ban on the establishment of data centres outside these areas.
    • For these clusters, the drawing up of an urban development plan (stedenbouwkundig plan) and an image quality plan (beeldkwaliteitsplan) in which the substantive points that plans must meet are laid down, is a condition.
    • Data centres may only be established on or adjacent to business sites.
    • Developments must comply with provincial policy, such as the Guideline for Landscape and Cultural Heritage (Leidraad Landschap en Cultuurhistorie).
  • Conditions of establishment
    • Mandatory agreement on location conditions between province and municipalities where data centres may be established, aimed at the impact on the environment, multifunctional use of space and the elaboration of the urban development plan and image quality plan.
  • Additional agreements and cooperation
    • Further cooperation and coordination with municipalities where data centres may still be established.
    • Agreements with the sector.


Data centre strategy: sustainability

This theme covers energy consumption, renewable energy, residual heat, water use for cooling (in relation to water availability), water safety and logging and the quality of discharge water:

  • Environmental Regulation, Article 6.62
    • Obligation to substantiate the environmental plan (i.e. a description of the way in which risks associated with climate change, including water safety, flooding and water availability are taken into account).
  • Conditions of establishment
    • Establish business conditions relating to energy and water with the municipalities. These conditions are aimed at maximising energy savings, reuse of residual heat in surrounding buildings, generating sustainable energy and sustainable water use.
  • Permits, supervision and enforcement
    • Through permits, supervision and enforcement, government authorities can influence compliance with rules in zoning plans and the environment. This concerns, for example, the application of recognised measures based on the Best Available Techniques.
    • Agreements with the Environment and Planning Agency.
  • Additional agreements and cooperation with municipalities, the data centre sector and other partner organisations
    • Research and pilots.
    • Sustainable procurement.
    • Connecting the sector to the ecosystem for innovation, work and development.
    • Agreements with the sector.

Observations

The data centre ecosystem in Amsterdam and Haarlemmermeer in particular has developed tumultuously in recent years into three hyper-connectivity clusters. This growth, however, appears to be coming to a halt. Both municipalities are limiting growth. In addition, Amsterdam in particular has imposed sustainability requirements. This does not only apply to these municipalities, but also to the province of Noord-Holland which is tightening the reins: new data centres are only permitted in the municipalities of Amsterdam, Haarlemmermeer, Diemen and Hollands Kroon (provided they are sustainable and blend into the landscape) and no longer outside of these areas. Moreover, large data centres (more than 80 MVA) must connect their own procurement station to the TenneT grid, which involves substantial investments.

It is doubtful that prohibition of establishment outside the locations mentioned in the draft provincial policy will hold up in court, particularly in light of the European Services Directive. Due to the growing demand for data centres in the hyper-connectivity clusters, it is conceivable that a refusal by a competent authority to grant zoning permission will be subject to more litigation.  A possible alternative option (namely a fourth hyper-connectivity cluster) cannot simply appear out of thin air. In any event, it would require clear government policy and substantial investment in the electricity supply.

To a certain extent, data centres are an example of 'ignorance breeds intolerance'; they do not have a human face, and do not make a visible contribution to their environment. Initiators can increase their chances of governmental cooperation by paying a great deal of attention to sustainability, the supply of residual heat to heat networks, fitting in with the landscape, intensive and multiple use of space and demonstrating social involvement. In general can initiators increase their chances of governmental cooperation by paying a great deal of attention to sustainability, the supply of residual heat to heat networks, fitting in with the landscape, intensive and multiple use of space and demonstrating social involvement.

Team

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