Mateusz Madejski, Business Insider Polska: Data centers are driving the AI revolution. What is the situation on this market? Is the growth here comparable to the most famous companies dealing with artificial intelligence?
Giampiero Frisio, head of the Electrification business, member of the management board of the ABB Group: I don't think I will surprise anyone when I say that this market has been growing very strongly – more or less since 2019. It is driven by investments from large companies such as AWS and Meta. Over the years, new companies have systematically joined this technological race – OpenAI and Google, which has led to a situation where today hundreds of billions of dollars are invested in data centers every year. The largest market is, of course, still the United States – from 60 to 65 percent. of invested funds goes to the USA. It is still the technological center of the world. However, more and more data centers are being built in Asia – especially in China, which shows where technology is developing today. This does not mean that Europe does not count in this race – there is also growth here.
Why is Europe behind?
Why is the United States so dominant and Europe is lagging behind?
Certainly, such investments started to be implemented in the USA earlier – about 15 years ago. Back then, they were data storage places rather than the large computing centers we know today. When COVID broke out and we moved work and entertainment to home, the demand for data processing began to increase. Additionally, recent years have brought a great boom in AI and machine learning. We all remember 2023 when millions of people around the world started getting excited about Chat-GPT. And there is no denying that this boom benefited primarily US companies, such as Microsoft and Google. Every company wanted to have its own language model, but this required training algorithms and processing huge amounts of data. They need to be safely stored and processed somewhere, so with the development of the AI revolution, data centers began to get larger and larger. This rapid development is also visible in Europe, which is the result not only of accelerated digitalization, but also of policies aimed at ensuring technological sovereignty. Today, virtually every country wants to have large investments in data centers, because technologies provide an advantage today. For example, one of the centers of the Stargate Project is to be built in Norway, and we also have the Mistral project in France. Germany also wants to invest in data centers. Poland is also becoming an important player in Central and Eastern Europe.
Are only large centers important in the world?
The power of facilities is certainly growing systematically, and their density, i.e. the amount of energy supplied to the server rack per square meter, is also increasing. Just a few years ago, data centers usually had a capacity of approximately 10-15 MW. Today they have over 100 MW. But interestingly, we are working on the Stargate Project, which aims to build advanced infrastructure for artificial intelligence. In this case, the data center capacity exceeds 1 GW. This is the equivalent of a nuclear reactor.
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Here is a chance for Poland
Can Poland be a regional data center hub for our part of Europe?
I think so. Especially considering Poland's population and size. It is certainly a challenge to ensure an appropriate energy mix. It guarantees not only lower electricity prices, which constitute 30-60 percent. data center operating costs, but also price stability and predictability. However, it is not only about the price, but also about whether it is possible to connect a data center, which consumes a lot of electricity, to the power grid. Power grids are overloaded and the mix stabilizes the system while lowering energy costs. It is no coincidence that many investments in data centers are located in areas with a large share of renewable energy or nuclear energy, e.g. in Scandinavia or France.
It is worth remembering that AI is not only about LLMs. We are observing a very clear development of AI agents. This will be the basis of business and industry in the future. And we, as Europe, if we want to remain an industrialized, economically developing continent, we must invest in AI, in data centers. Both in Poland and on the entire continent. You also need to remember about safety here.
We can't rely on centers outside Europe?
That's exactly what I mean. If we care about security, including the security of our data, we must have data centers located in Europe, not outside it. This is crucial to our independence.
How do data centers even work?
Those being built today are completely different than those built 15 years ago. They are simply big, gigantic computers, increasingly built to process data using AI technology. They must guarantee business continuity and processing stability every time someone asks LLM a question – and this happens on a massive scale. As the demand for AI is increasing, the energy consumption of data centers is increasing significantly. In the near future, they may need even several times more electricity than today's facilities. That's why the role of companies like ours is huge. We are here to ensure that data centers consume less energy and provide constant access to data processing. Because today's economy and business are based on computing power and data.
What is your role when it comes to data centers?
Let me put it this way – one out of four data centers in the world uses our solutions. Why? Because the price of energy is today the largest cost of data processing, and artificial intelligence systems consume much more of it than traditional IT systems. And this is where our role begins – we provide solutions that optimize energy consumption, manage it automatically and reduce the risk of failure. Recently, we acquired, for example, OctaiPipe, which gives us access to data center cooling technology that allows us to reduce energy by 30%. without the need to upgrade equipment. We are working with NVIDIA on a new generation of power systems that will allow us to create an infrastructure capable of handling very large computing loads while reducing energy losses. Interestingly, we use the experience gained in designing power systems for the maritime industry. Thanks to them, ships achieve a reduction in energy consumption of 20-40%, and their maintenance costs are lower by almost one third. We are also the only manufacturer in the world that produces a medium voltage uninterruptible power supply. It may sound complicated, but it is an extremely important device that can provide access to the network and data in the event of power outages. This solution is dedicated specifically to data centers.
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