Overcoming site challenges for urban data centers

Site selection for urban data centers must consider municipal infrastructure, air permitting, environmental constraints and electrical service

By Joshua Fluecke June 6, 2022
Courtesy: Gensler


Learning Objectives

  • Learn about the benefits and disadvantages of situating data centers in urban environments.
  • Review the design challenges associated with urban data centers.
  • Know the importance of early site assessments.

The data center industry has recently seen a demonstrable rise in construction, especially in urban environments near population centers. For data center owners and developers, there are advantages to such proximity.

Yet positioning data centers in urban environments creates challenges for a project’s design team that it wouldn’t encounter in rural or remote areas.

Cloud provider growth over the past decade has created enormous data center campuses, often in rural areas of the country. These cloud data centers enable users to host virtual desktops, applications and data storage. The initial premise was that it doesn’t matter where these platforms reside. Previously, this paradigm presumed that all computing would be completely commoditized in the cloud.

However, time-critical applications in urban areas have led to latency concerns. It has become apparent that the majority of end-use and “internet of things” devices are in urban areas. Furthermore, the number of these devices is expected to grow exponentially in the near term, thus creating a need for data centers closer to urban population centers. This is logical, considering that urban areas are where most of the United States population resides. But when developers and owners situate these data centers close to urban environments, they create several significant obstacles for design teams.

Four data center design challenges

When deciding on a data center site in an urban area, an early understanding of four site constraints is essential to a project’s success.

1. Municipal services

Campus and building connections to water, storm and sanitary municipal systems are basic requirements regardless of where a data center is located. Proximity to urban environments places pressure on these local municipal systems to meet the projected demands of the site. In many cases, owners and developers choose industrial corridors and technology parks as target locations for urban data centers due to adjacencies to power and fiber paths.

When project teams perform due diligence on a potential property, they often identify a need to upgrade the capacity of a municipal system serving the site. These municipal upgrades may need to happen off-site or be part of a larger city project to increase capacities for water, storm or sanitary services for expected and future demand.

In addition, water is currently cheaper than electricity and this has driven up the use of evaporative cooling systems for hyperscale data centers in several regions. High water usage may generate community concerns as well, especially when a proposed data center may use millions of gallons of water a day in a water-stressed region.

2. Air permitting

Another consideration is the Environmental Protection Agency Environmental Justice program. A data center will generally have a significant number of diesel engine electrical generators to support the data center in the event of an electrical utility outage. As such, these engines will require environmental air permitting for the data center to operate the engines.

Operating permits are legally enforceable documents that permitting agencies issue to air pollution sources such as standby engine generators. In urban areas, if the data center is located within a certain distance of low-income and/or minority populations, it becomes an Environmental Justice area of concern. This means residents are notified, there may be public meetings and this could introduce technical and public relations complexities to the permitting process for the site.

3. Wetlands

Wetland areas situated on a data center site are never ideal. At potential urban data center sites, smaller wetland areas do exist and they pose similar challenges like those found in rural areas. An owner may need to purchase wetland credits to offset impacts, removal or partial removal of the existing wetlands on-site based on the data center campus design and masterplan land requirements.

A wetland mitigation credit is a unit of trade used to offset ecological losses that occur in waters of the U.S., which are regulated by the U.S. Army Corps of Engineers and EPA. Another challenge is site construction logistics, especially if construction takes place around existing wetlands.

In addition, overall permitting timelines to review the impact to wetlands through the Army Corps of Engineers or EPA are sometimes unpredictable and may elongate project schedules while the project team is awaiting permit approvals.

4. Electrical utilities

Data centers are enormous consumers of electricity. It’s currently estimated that 1% of the world’s electricity goes to cloud computing and this percentage is expected to grow exponentially over the next decade. The future demands of artificial intelligence, augmented reality and the advent of digital currencies will likely continue to drive this power consumption.

Initially, it will make sense to process more data near urban centers, as this is where the demand will be. However, it may not be possible to support the sheer magnitude of the projected cloud power requirements, as increased computing needs couple with decreasing efficiencies.

Available utility power has always been one of many drivers for data center locations, but it may end up being the main one in the near term because it will be challenging for utilities to quickly meet the anticipated rise in demand via new power plants and infrastructure.

Electrical utilities often take a considerable amount of time to finalize service agreements and negotiate the timing of load ramp availability, extend electrical service lines or build new electrical substations. In urban areas, there is often competition for the similar resources, either from other data centers or industrial neighbors. For example, truck-fleet charging for electric vehicles could be competing for the electric utility availability if a major logistics site is planned for the neighborhood surrounding the data center.

Speed-to-market has always been an important driver for data centers. However sometimes a project is beholden to the availability and timing of utility power to a site. As electrical demand increases, there is a renewed interest in on-site generation through green alternatives such as solar photovoltaic panels and wind-powered turbines. On-site PV panels and wind turbines need a lot of real estate to function at scale and data centers are usually challenged with available space in urban environments.

Another on-site generation option is the use of the latest gas turbine technology. Gas turbines for generating power on-site for data centers is becoming an attractive option as they would solve current utility grid challenges and those that may continue in the long term. In the future, gas turbines are predicted to run exclusively on carbon-free fuels such as hydrogen. It is likely, therefore that many developers will explore ways to incorporate this type of on-site generation into plans for future data centers in urban areas with known grid challenges.

Confidential urban data center. Courtesy: Gensler

Preparing for a new data center

When selecting a potential data center site in an urban area, an early understanding of significant site constraints is essential to a project’s success. The following all factor into this analysis: identification of limiting factors regarding the availability of the municipal infrastructure systems, water, storm and sanitary connections; understanding a site’s air permitting or wetland environmental constraints; and coordination with the serving electrical utility.

It often takes a considerable amount of time and research by the project team to uncover site constraints and mitigate any potential impacts to an urban data center’s cost or project schedule.


Syska Hennesy is a CFE Media content partner.

Author Bio: Joshua Fluecke is a principal at Syska Hennessy Group and co-leads the firm’s critical facility practice.