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Increased power needs ‘biggest challenge’ for data centres

Glasgow-founded cloud provider Iomart said energy needs will be its ‘limiting factor’

Data centre power
Image credit: Caureem / Shutterstock

A surge in the demand for data centres driven by the adoption of AI technology has made the “increased power needs” the “biggest challenge” faced by the industry, according to Glasgow-founded cloud solutions group Iomart.   

Speaking to UKTN, Iomart CEO Lucy Dimes said that despite AI hype kicking off in 2022, the company, which provides cloud data storage services, only started to see a tangible impact in the past year.   

“As with all of these things that are in the hype stage of the Gartner Hype curve, they tend to get talked about long before real things are happening, and it’s a monetizable opportunity,” Dimes said.   

It may have taken a while but that impact is now being seen by the group, which was founded in 1998 and listed in London in 2000. 

According to Dimes, though the company has so far been able to accommodate this newfound demand, it is highlighting a wider concern for the sector. 

“The biggest challenge we’ve got, and the industry has got now, is the increased power needs in data centres,” the Iomart chief executive said. 

“That will probably be our limiting factor, along with everybody else’s, in terms of, if that demand steps up considerably, you know, how do we, how do we fulfil that demand.” 

The UK has been positioning itself as a great supporter of data infrastructure since the economic opportunities of AI became apparent.   

Since Labour took office in July alone, there has been more than £25bn committed by the private sector – mostly US tech firms. UK Technology Secretary Peter Kyle has described this as “a vote of confidence in Britain and our approach to work with business to deliver sustained growth for all”.   

According to Dimes, however, “getting access to the greater power supply” will be the issue.   

“I’m sure that discussions are going on with the power companies around very significant new increase in power supplies needed,” she said. 

“Unfortunately, it’s not just a case of plugging into the network and sort of getting the power you want. You have to make sure that the power supply into your data centres is set up for that.” 

Iomart on Wednesday published its half-year results for the six months ended 30 September 2024. 

Revenue was unchanged from the same period last year at £62m but pre-tax profit dropped 77% to £1m.   

Dimes described it as a “challenging year”, however, claimed the company’s recent acquisition of Atech for £57m has “significantly” increased her confidence in the performance in the second half of the financial year. 

The deal, announced in October, saw Iomart acquire Atech, a Microsoft MSP partner. Iomart shares opened trading on Wednesday valued at 98p, down around 1% from Tuesday morning. 

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