The FLAP-D cities still house Europe’s highest data centre capacity, but this leadership has come at a price.
Energy supply is showing cracks in some markets. Dublin has suspended new data centre approvals in congested areas, while Frankfurt still depends heavily on fossil fuels. Relying on fossil energy can thwart operators’ sustainability targets, especially as ESG concerns move to the fore.
Power costs are also casting a shadow. Germany’s exit from nuclear power and its shift away from Russian gas have pushed up wholesale electricity prices. Volatile costs hurt margins and make long-term planning a challenge. Securing multi-year Power Purchase Agreements (PPAs) in these big markets has become tougher, and investors risk abrupt price spikes.
Environmental directives are also reshaping the landscape. The EU’s Taxonomy for Sustainable Activities adds layers of scrutiny. Operators in FLAP-D hubs must adopt water-saving and low-carbon construction methods, or risk project delays and extra costs.
A labour crunch compounds the challenge. Skilled workers are in short supply, particularly in construction and engineering. Wage pressures are biting in hotspots such as London and Frankfurt, dragging out project timelines and driving up costs.