Monday, August 27, 2012

Choose Iowa For The Project Edge Data Center

Back in 2010 I was considering a post to entice Microsoft to build a data center in Iowa.  At that time Iowa was in the running, but the decision had not yet been made. This was the Microsoft and Google build-out era of the mega data centers, similar to the Facebook and Apple story of recent years. As I started to write the 2010 post, Microsoft announced that they had decided on West Des Moines for their latest site.

So.... I am writing today to entice Facebook or Apple (who else has $1.2B to spend) to select Iowa for the site of its next data center. Earlier this year the buzz was out that 'Project Edge' could result in a $1.2 Billion data center campus. The decision was down to either Iowa or Nebraska, and the political battle (i.e.: tax incentives) was on. Although all sources said the mystery company was looking to break ground in May 2012, nothing happened.

I won't spend too much time stating why Iowa is an awesome place to build Project Edge - the facts do that for me   :)

  1. Iowa is #2 in wind energy - installing 647MW of new capacity in 2011, for a total of over 4,300MW available.
  2. Iowa has wonderfully robust technology and innovation support systems.
  3. CNBC's Top States for Business 2011: Cost of doing business - Iowa #1, Nebraska #17
  4. Google and Microsoft constructed data centers in Iowa. Google even expanded another $300 million this year.

An article last week at says that Project Edge is on hold.  The article says that the mystery company is "trying to figure out logistics...". Facebook (FB) has had some stock issues since its IPO, but should still be able to pull the trigger.  The world's most valuable company (AAPL) just won a $1B verdict against Samsung - so they should have no problems executing.

The logistics of site selection is a pretty interesting process. Since this project has been publicized for so long now, I doubt the site is the problem, but figuring out exactly what the company wants to do. If it is Apple, they announced a new data center near Reno in June and perhaps that one was just prioritized over the Iowa site announcement.

In 2007 I wrote about data center site selection - at a macro level. For companies like Facebook, Apple, Google and Microsoft the regional data center strategy is to be in close network proximity to its user base and the macro-level decision boils down to some of the evaluation criteria that I have in mind for adding to my site selection white paper.

Two big ones are water and power (strength in renewables, capacity, reserve...). Obviously data centers built to the scale that these companies develop will require a plentiful, reliable water source for years to come. The 2012 drought that has hit many parts of the midwest may have an impact in looking at a site for long term. As I state in my white paper, there really is no area in the country that is completely impervious to some form of natural disaster - there could be drought this year, but a flood the next.  As a visual learner I appreciate maps, and have found a number of useful maps with data at the USGS Water Science School site. Climate change impacts are also a consideration - and the EPA has some nice resources for researching that.

Power is another one of the large areas to research when selecting a site, and there are a number of sources to look at. Iowa and Nebraska are on the same power grid, but some recently published information from the U.S. Energy Information Administration was interesting -- about the regional reserve margin estimates. It is just a short term reliability assessment, but interesting: Iowa is covered in the Midwest region, and has a 27% reserve margin estimate, with a 17% target, and Nebraska is in the Central region, with a 20% estimate and 14% target. Texas, having its own grid ....  well.... is in trouble again for keeping up with demand.

Microgrids are another interesting power topic .... but for another post. Forbes had a really good article recently on Distributed Energy.

Either state would be a good choice for the Project Edge data center, but should the mystery company look at Iowa - I would especially recommend cities that start with a W.