The Finnish Energy Industry has addressed rising concerns about the electricity consumption of data centers, emphasizing that new production capacity will be developed in line with increased demand.
In Finland, worries regarding the high electricity consumption of data centers have escalated since January when wholesale electricity prices surged. Critics fear that the growing presence of data centers will lead to increased electricity prices for households. However, Jari Kostama, the director of the Energy Industry, reassures that such concerns are unfounded. He claims that as electricity consumption rises, so will the production capacity, primarily in the form of land-based wind energy.
Kostama elaborates that the price of electricity for consumers would only increase if there is insufficient production to meet demand. This is a crucial distinction as data centers and other large industrial enterprises often secure electricity through long-term Power Purchase Agreements (PPAs). These contracts allow them to buy electricity directly from producers, typically for 10 to 20 years, in contrast to regular consumers who usually engage in shorter, 1 to 2-year contracts.
The discussion is particularly relevant in light of recent announcements by companies like Alight Energy, which plans to develop new facilities to meet growing energy needs. The Finnish approach to expanding production capacity in correlation with increasing electricity consumption signals a proactive stance towards both industrial growth and energy sustainability in the context of rising electricity demands.
