Rising energy costs are making the cloud more expensive • TechCrunch


Since the winter around With the onset of the war in Ukraine, energy costs skyrocketed—particularly in parts of Europe that were historically dependent on Russian fuel. These are the affected data centers, which are not directly dependent on resources such as natural gas but often rely on power grids and standby generators that generate a portion of the electricity using fossil fuels.

According to the month of July Report From power generation supplier Aggreko, data center operators in the UK and Ireland have seen their energy bills increase by up to 50% over the past three years, with the biggest increases occurring over the past year. 58 per cent of those in the UK said their energy bills had a “significant impact” on their companies’ profit margins.

It seems inevitable that premium power data center operators will be forced to pay customers. In fact, it is already happening.

Back in November 2021, Manchester-based cloud service provider M247 raised prices by 161%, blaming “Unprecedented times in European energy markets.” Cloud Providers Cloudheadquartered in France, and Hetznerand Germany-based, both recently announced that they would raise prices by 10% in the coming months to combat rising energy costs and inflation. In an earnings report, OVHcloud told investors it expects “electricity costs in 2023 will account for about a medium to high single-digit percentage of its revenue, up from the average single-digit in 2022.” mentioned.

In a conversation with TechCrunch, Gartner Senior Analyst René Buest noted that the era of persistently low cloud prices is over for some time. (Google Cloud, for example, a plus Prices for its basic services in March regardless of rising energy costs.) But she agreed that rising costs — and associated inflation — had accelerated the upward trend in cloud pricing.

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