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The Budget – what’s in it for the Data Centre community?

Internet Services

Although no direct investment in data centres has been announced, the promised increase in fast internet connectivity will no doubt lead to an increase in demand for services and therefore for data centre space.

The budget confirmed that £100 million, announced in the autumn statement, is to be invested in making Belfast, Birmingham, Bradford, Bristol, Cardiff, Edinburgh, Leeds, London, Manchester and Newcastle into “super-connected” cities. It also announced a further £50 million of investment to fund a second wave of 10 smaller super-connected cities.

Overall investment in internet access is promised to be £530 million by 2015, and this is in addition to private sector investment such as BT’s £2.5 billion fibre roll-out programme.

As well as the financial packages mentioned above, the government’s National Infrastructure Plan 2011 announced that Ofcom’s 4G spectrum auction is to commence by the end of 2012 and confirmed the 2010 Spending Review’s announcement that an additional 500MHz of radio spectrum is to be made available for mobile networks.

Energy Supply

What will be of very real interest to anyone operating a medium to large data centre, and indeed many operators of small data centres that are part of large organisations, is that consultation is to take place on simplifying the Carbon Reduction Commitment (CRC) scheme. To quote from the Treasury’s budget executive summary: “Should very significant administrative saving not be deliverable, the government will bring forward proposals in autumn 2012 to replace CRC revenues with an alternative environmental tax”. This follows complaints by a number of business organisations that the scheme, introduced just 2 years ago, is overly complex and bureaucratic.

The budget also increased allowances for oil and gas production in the UK and UK continental shelf and confirmed that gas fired power generation will continue to be a key element of the UK’s electricity supply, for the foreseeable future