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Finland is an ideal location for data centers

Finland is an ideal location for data centers

Right now, there is a heated discussion about data centers being built in Finland. It is also important to remember that existing capacity can be utilized, making Finland an attractive market in this regard as well. New data centers are rapidly being established across Europe to meet the growing demand for data usage, especially with the rise of artificial intelligence. Finland stands out thanks to its cost-effective energy, available space, natural cooling, and high-quality telecommunications infrastructure, says Juha Syrjänen, Director of Digita Data Centers.

Finland is home to over 50 data centers, and the number continues to grow. The Finnish Data Center Association (FDCA) estimates that approximately 2GW of new data center capacity will be announced in Finland in the near future.

Cool Climate Brings Up to 50% Cost Savings

Finland has a diverse climate with all four seasons well represented. However, by global and European standards, Finland remains cool for most of the year. According to the Finnish Meteorological Institute, the national average temperature in 2024 was approximately 4.0°C. Finnish data centers take advantage of the cold climate, reducing cooling costs by up to 50%.

  • No Major Natural Disaster Risks

Climate change is intensifying weather phenomena worldwide, increasing the risk of natural disasters, including Finland. However, Finland’s climate remains relatively stable and predictable. There are no massive floods or severe storms capable of taking down the entire power grid. Additionally, Finland is seismologically stable, meaning earthquakes do not pose a threat to the sensitive systems of data centers.

  • Affordable, Reliable and Green Energy

Finland stands out in terms of energy pricing, availability, grid coverage, electricity quality, and taxation. Electricity is affordable by European standards, and its availability is secure. For example, in 2022, the average electricity price for households in Finland was approximately €0.1934/kWh, whereas in Germany, Italy, and Spain, the average exceeded €0.30/kWh.

Another key factor is that Finland considers its electricity grid a critical part of national security infrastructure, ensuring world-class reliability. In 2022, Finland’s electricity transmission reliability was an impressive 99.99993% (Fingrid). Continuous and substantial investments are made in grid maintenance and development.

Additionally, Finland is heavily investing in green energy, increasing its capacity in hydro and wind power while also utilizing waste-to-energy solutions. Over 75% of the electricity used by Finnish data centers comes from renewable sources. Electricity is produced carbon-free through hydro, wind, solar, and nuclear power.

A Stable and Innovative Society

Finland is a stable and peaceful society, providing a secure environment for data center investments without significant political turbulence. In 2024 alone, over €1.5 billion was invested in new data center construction in Finland. The country is also known for its digital innovations. For example, the excess heat generated by data centers can be fed back into the energy grid, benefiting the broader society. Additionally, Finland’s highly educated workforce ensures access to skilled professionals.

The Finnish government and municipalities actively welcome new data centers, evident in streamlined zoning and permitting processes that are more efficient compared to many competing countries.

Excellent Telecommunications Infrastructure

High-quality telecommunications networks enable the efficient use of local services, such as cloud computing. Strong connectivity to data centers creates an ideal business and development environment where data remains locally managed and secure, enhancing operational resilience.

Finland also boasts a well-developed infrastructure, including world-class domestic and international telecommunications networks. Connections to Europe’s key data hubs are among the best available.

Fast Internet Connections Improve Services

Many of these factors make Finland a haven for fast internet speeds. High-speed and low-latency connections are essential for various business applications, including online gaming, which requires distributed and fast data capacities.

Significant Growth in Data Center Investments

According to the Finnish Data Center Association (FDCA), approximately 2GW of new data center capacity is expected to be announced in Finland in the near future. Standard data center projects typically cost around €10 million per megawatt (MW), meaning the total investment in construction alone will be approximately €20 billion over the next 10–15 years.

These projects are expected to create 40,000 person-years of employment. Direct job impact of a 100 MW data center: around 2,000 employees and cumulative effect (maintenance, logistics, accommodation, etc.) 2,000-16,000 new jobs.

Juha Syrjänen

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