Gartner predicts energy crisis will hit data centre budgets by 40% or more

Graphic showing prices rising
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Data centre operators could be looking at a 40% increase in costs due to the looming energy crisis, according to Gartner, and there might not be a viable solution in the UK for years to come.

Data centres are set to face a similar fate as consumers and other businesses, Gartner senior research director Tiny Haynes told the IT Pro Podcast, with non-data centre operators and other organisations seeing their prices "go up by a factor of three". He also warned that similar price spikes could potentially happen in the data centre market over the next six to 12 months.

"​​I'm hearing people talk between 25 and 50%," Haynes said. "It really depends on the global gas price as we're now at the mercy of geopolitics. Unfortunately, it will take some time for the UK as a general rule to bring in additional capacity from renewable sources where you're not going to be subject to such price variance.

"We've had the announcement by the outgoing Prime Minister of new investment into nuclear power stations in Sizewell C. But that's probably going to be about ten years before it comes online. So as far as price rises go, I can only see them going up."

However, the impact isn't going to affect every data centre in the same way, according to Haynes, as it depends on the facility and the operators themselves. For those providing straightforward data centre space, Haynes suggests their margin is going to be exposed to power pricing, he said, whereas managed services providers, and those that add cloud or professional services, may be insulated from cost increases by larger margins.

So far, these increased costs are being kept away from customers, according to Haynes, with the bigger players - Amazon Web Services, Microsoft and Google - said to have no intention of passing them on. There isn't anything to suggest that will stance won't change over the next year or so, though it is highly likely that smaller cloud operators will have no choice but to pass the cost on.

"Some of these providers are making a lot of money and some of them are not," Haynes said. "So I think you're probably looking at those organisations which aren't making as much margin who'd be more likely to pass on the price raises."

Bobby Hellard

Bobby Hellard is ITPro's Reviews Editor and has worked on CloudPro and ChannelPro since 2018. In his time at ITPro, Bobby has covered stories for all the major technology companies, such as Apple, Microsoft, Amazon and Facebook, and regularly attends industry-leading events such as AWS Re:Invent and Google Cloud Next.

Bobby mainly covers hardware reviews, but you will also recognise him as the face of many of our video reviews of laptops and smartphones.