Someone asked about data centres in the threads. The truth is that a bunch of us were pushing NB to get out front and become an early adopter of this sector almost a decade ago. With the advent of large scale but not critical data storage (the banks always had ‘data centres’) like YouTube videos there would be exponential growth in this area. I think the first formal briefing I did on this sector was in 2002.
But the truth is that it has always been about about cheap electricity. A good sized data centre uses as much power as a small pulp mill and energy costs can be as high as 60%-70% of annual operating costs.
In the early 2000s New Brunswick’s large industrial power rates were reasonable but still above Quebec or Manitoba or BC not to mention 20 or so U.S. jurisdictions. By 2010, they are completely out of whack for attracting this industry.
We have looked at alternatives such as incentives to allow these firms to produce their own power (Google is a federally regulated electricity utility in the US) or zany ideas about using Bay of Fundy water to cool the data centres (cooling is a huge part of the cost) but in the end if you have a power bill of $10 million/year in New Brunswick and it would be $5 million in Washington State or $4 million in Manitoba, where are you going to go? Iceland – with its cheap geothermal – has been attracting them as well.
I think this is an important and instructive example, however, for at least a couple of reasons. First, we need to be looking at potentially high growth sector opportunities that lie just over the horizon. That is why we gained such traction with the customer contact centre industry. It takes more than just identification, however, as New Brunswick was also among the first jurisdictions into things like aquaculture, GIS and eLearning and we never really saw those sectors blossom into real growth engines for the province.
So the value proposition for investment in these sectors is critical and we don’t have the value proposition for data centres.