What next for data centres in Manchester?

Data centres are fast growing businesses and are vital in supporting large amounts of the economy – not just the digital economy. The discussion acknowledged that data centre capacity has not kept up with demand, both locally and nationally, as the demand for data grows. This presents a challenge in the form of a lack of data centre space. There are several reasons why this might be happening, including the difficulty faced by data centre operators when trying to find available sites for development that offer adequate fibre connectivity and power. It should be acknowledged that network infrastructure has improved, but there are new challenges in the mix such as sustainability and financing of new data centre projects.

Data centre heat re-use, where waste heat is recycled and used for community heating projects, has been utilised in some areas of the country, including a project at Datum’s new Manchester data centre facility – MCR2. However, attendees discussed the difficulties surrounding such projects, and the technicalities behind these difficulties, all of which need further examination to aid the delivery of heat re-use initiatives. There is a need for local authority planning departments to think ahead and work with the sector to understand needs, capacity, and site allocation, and to address the technical implications of these projects.

An interesting theme of discussion within this context was the idea that heat should be seen as an asset, rather than a drawback. Interestingly, data centres improving their own efficiency is helpful for action on climate change, lowering costs and improving power usage effectiveness, although this would impact the heat generated and would hinder heat re-use projects. techUK had just published a report ‘Warming Up to Efficiency’, examining the benefits and drawbacks of data centre heat export in the UK.

All attendees at the roundtable noted that local engagement is key, and that the onus must be put to some degree on the domestic construction sector to enable heat re-use initiatives- if new homes are being developed too far away from the data centres, then heat re-use will be a non-starter.

Data centres can and should be seen as a route to leveraging inward investment thanks to their connectivity infrastructures, which aid other businesses, create wider employment opportunities in the tech sector, and act as an anchor for inward investment. Although a data centre may only employ 15 or so people, it will support hundreds of clients, and that ecosystem generates employment.

Speakers acknowledged that there is a similar argument when it comes to skills. Apprenticeship programmes run by some data centre firms are accredited and collaborate with the industry more broadly (not just the data centre sector). These types of jobs exist and can open doorways to learning and to career development across other parts of the tech sector.

Attendees noted a pressure on apprenticeship places for 16-19 year olds and that technical education is devolved to the combined authority – there is a need to provide more alternative routes to jobs and careers and shape this at scale across the whole tech sector.
Data centres may offer a route to inspire and spark an interest in technology careers (particularly when working with educational establishments) and to broaden perspectives by showing how data centres matter to everyone’s everyday lives.

There is a wider need for local authorities to understand the economic value of data centres, and to communicate this. This would aid the powerful case that Greater Manchester wants to make about international investment and securing deals such as Anglo-Japanese agreements. It also helps the Department of Business and Trade, the Department for Science, Innovation and Technology and others to share the success of projects and their plans and ambition to be a global science and tech superpower. Similarly, in the north west of England, this complements the cyber specialism and knowledge already in the region and the growth plans for the future.

Local authorities have their own data centre needs, and some have small onsite data centres that impact their own emissions and climate change ambitions. However, there are limits to how much they know about their own heat emissions and future data requirements, which makes it a challenge for local authorities to state how efficient (or inefficient) they are. There’s a business case for moving these racks to data centres not just for sustainability, but for scalability.

The group discussed compute capacity, new types of cloud sharing, the GM One network being built in Manchester, and ownership of a wider digital infrastructure conversation (including data centres).

One attendee noted that AI has exploded as compute power has increased. Large language models are getting bigger, which means data centres becoming more power hungry. With a greater democratisation of AI, more education on the topic, and increased adoption, comes the need to future proof data centres and digital infrastructure to address those changes.

Finally, attendees discussed the idea of ensuring that Greater Manchester is a business-friendly place for data centres. While Singapore and Dublin have halted the development of new data centres , this only means that the need moves elsewhere. Managed correctly, data centres can help attract capital to the UK.