The claim comes as it emerged one of the biggest ICT companies in the world, which had been planning a multi-million pound investment in a 53-acre plot in Ecclefechan in Dumfries and Galloway, had changed its plans to invest in the proposed modular datafarm development after the passage of a key stage of CRC (carbon reduction commitment) legislation in the House of Lords last week.
Internet Villages International (IVI) and APC Schneider are currently promoting the Ecclefechan site through the planning process. Spokesmen for the two firms said that the company involved – which has been heavily courted by Enterprise Minister Jim Mather and senior Scottish Development International officials – now intends to locate its data storage operations in the Republic of Ireland and the Netherlands.
Terry Hurley, Scottish Enterprise’s senior director of tech media, said: “If it is true, it’s very disappointing.”
Promoters of the Ecclefechan plan claim the scheme will provide a major strategic boost to a key industry of the future. As well as giving a critical boost to Scotland as an internationally-recognised location for datastorage and potentially job-creating “cloud computing”.
Establishing a foothold in this highly sensitive and competitive sector is widely seen as bringing positive spin-offs in jobs and IP enhancement for the academic, construction and renewable energy sectors.
A spokesman for IVI told the Sunday Herald: “Last November, we were informed by this company that due to the proposed CRC Act of Parliament, our status and that of Scotland, had gone from green to amber. As the CRC Act has now been passed through the UK Parliament and ratified by the Scottish Parliament, it is safe to assume we will not be seeing any inward investment into Scotland or Great Britain.”
It emerged yesterday that Dr Brian Murray of Morse Group consultants, one of Scotland’s leading experts on the international data storage and cloud computing industry, and a key supporter of the Ecclefechan scheme, raised the impact of the CRC in a meeting with Chancellor Alistair Darling.
Dr Murray told the Sunday Herald: “The Chancellor wanted to explore why the CRC Act was an issue.
“I explained that none of the organisations involved had any problem with the principles of the act, but were facing challenges around how it had been implemented. I clarified that, if it had been a European-wide initiative rather than UK-specific one, it would probably not be facing so much opposition.
“It is important to stress CRC is UK-specific – if we are to put ourselves on a level playing field with our neighbours, we need to press for an acceptable European-wide scheme as soon as possible.”
The industry’s case against the CRC is based on what is perceived as its “woolly” drafting and the lack of certainty it provides about future penalties on high-volume power users such as datafarms, even those that take their energy from renewable sources such as biomass and wind.
The UK’s Carbon Reduction Commitment, now called the CRC Energy Efficiency Scheme, comes into force in April. Critics have dubbed it a “serious threat to UK businesses [that] could even have little, no, or possibly negative effect on global emissions.”
One loophole is that, instead of urging UK companies to reduce their emissions, it encourages them to relocate emission-heavy operations such as data centres to countries with less stringent regulations, removing incentives for organisations to pursue a more efficient, low-emission business model.
Critics claim that the CRC was drafted with minimal consultation with the datafarm industry, and is blind to the question of energy source.
Dr Murray said: “An organisation taking its energy from renewables is treated exactly the same as one relying on coal-fired power stations. This is despite the fact that the two examples would be responsible for wildly different carbon emissions, from the same amount of energy used.”
A spokesman for the Scottish Government said: “ICT equipment is currently responsible for about 10% of the UK’s electricity consumption and data centres account for about a quarter of the ICT sector’s emissions, so making ICT more energy efficient is a crucial part of reducing emissions.
“Our climate and renewable energy potential make Scotland hugely attractive for data centre operators and we do not believe the CRC changes this.
“Data centres use technology which is continually being improved, resulting in reduced energy demand. Just like other participants, data centre operators have the potential to perform well in the scheme. We will of course keep the CRC scheme under review.”
