In this digital world, we’re never far from our smartphones and tablets. Shopping on the web has become the new normal, and though we know left from right, our GPS is at the ready. That’s a lot of information, and we need data centers to house, organize and transmit that big data. Today’s data centers can’t be yesterday’s models. As they grow, the next generation is being built, retrofitted and planned with efficiency in mind to reduce the heavy and expensive energy consumption.
According to a 2012 report, Pike Research, a part of Navigant’s Energy Practice, says the worldwide market for green data centers will grow to $45.4 billion by 2016—at a compound annual growth rate of nearly 28 percent from 2002’s $17.1 billion.
Navigant’s research director, Eric Woods, sees the greening of data centers as a business response to reduce costs and address environmental concerns.
“That translates to a mandate to reduce energy consumption, which in turn is driving innovation. Data center operators are exploring new ideas related to business models, facility construction, layout and design, air flow dynamics, new technology, and monitoring and management tools,” Woods said.
Projects abound both big and small. Microsoft recently announced plans to build a new $677 million data center in Iowa to help accommodate its cloud computing effort. Facebook is building its second major data center, a $450 million project in North Carolina. In New York, Yahoo is investing $500 million in additional data centers. Those are just the big names.
Bill Sewell is in the catbird seat regarding what’s going on in today’s data market. Sewell is the director of programs for Willdan Energy Solutions. With offices in 10 states and the District of Columbia, the California engineering and planning firm has made data centers one of nine focus markets.
“There’s certainly been an evolution,” Sewell said. “Making data center spaces more energy efficient is a big one to help reduce costs.”
Sewell saw a real focus on data centers develop around 2010.
“It got serious for Willdan when Southern California Edison asked it to tackle their data centers program, followed by NYSERDA [New York State Energy Research and Development Authority], and took off from there with work coming from Ohio, Chicago, Houston and other locations,” he said.
Sewell said his firm has seen a lot of upgrades to existing data centers that support healthcare (hospitals and pharmaceuticals), insurance and credit card companies, and federal clients from the Veterans’ Administration to the Department of Defense and Federal Aviation Administration. His firm also is seeing a call for co-location facilities to support the cloud.
“The possibilities are bigger right now than the capital budgets,” Sewall said. “But decision-makers are paying attention. For us, data center work is steady and growing. The return on investment is anywhere from 10 months to three years, depending on project size and scope. Owners that go green can expect an operating cost reduction of maybe 10 percent and as much as 20 percent in some cases.”
A tale of two contractors
Bronco Electric Inc., based in Houston, and Miller Electric Co. in Jacksonville, Fla., have found success in data center work. Bronco opened its doors just under six years ago. Miller has been around since 1928 and started pursuing data center work in the 1970s. Both have made data centers a specialty service.
For Miller, its entry into the world of data centers began with Ron Autrey, now the company’s board chairman. Coming to Miller with a computer background, Autrey was familiar with data centers. It gave him an avenue to pursue this work in commercial and healthcare markets.
“Through Ron’s efforts, we were doing data center installation in the late ’70s and early ’80s,” said David Stallings, vice president, Integrated Systems for Miller.
“By the mid-’90s, we were providing maintenance services. Data center work is now a division for us,” said Donnie Smith, vice president, Corporate Services. “Look at where we do business, and you’ll see where data center work took us.”
Miller’s offices and sales territory are largely southern-based, but the company also serves Denver and Washington, D.C., as a result of its data center expertise. Requiring both low-voltage and power service, Miller has a dedicated crew of data center project managers, field supervisors and support staff.
“Data centers are complex buildings needing sophisticated MEP systems that house racks of servers and network switching gear designed to securely store and transmit information,” said James MacDonald, Miller vice president, Corporate Services. “Data centers and healthcare are very similar with their critical nature. We provide power testing, as well.”
Smith added that Miller does both center upgrades and new construction as owners run the numbers to see which approach makes the most sense.
“We prefer design/build and find 70 percent of our data center projects take this collaborative approach,” Smith said.
Data connectivity (copper and fiber) is a big part of the job for electrical contractors (ECs) who build the infrastructure for a data center.
“Today’s centers are looking to add building automation systems, power monitoring systems and security measures such as closed-circuit TV and access control,” Stallings said.
For Bronco Electric, 60 percent of its work comes from data centers. Like Miller, the company handles low-voltage and alternating and direct current power, including alarm and monitoring, uninterruptible power supplies (UPS) and generators, cabinets and racks, fiber troughs, and the testing of Cat 5e and Cat 6 UTP, DS11, DS3, T1 and fiber optics.
“We’ve enjoyed a nearly 50 percent growth in this market over the last two years,” said Keith Brown, president and owner of Bronco Electric. “More data center customers are spending money on maintenance, lighting retrofits, energy management and monitoring systems. We’ll often lay out or change out cabinet and data and fiber to meet customer’s needs and manage room layout so cool and hot aisles don’t co-mingle to reduce efficiency.”
Being a young company, Bronco’s introduction to data centers was fortuitous. In Houston, it took on a project for Digital Realty Trust, a company that leases and sells space to other companies that require data centers. Building from one success to the next, Bronco established itself as the go-to contractor for data center installs. The trust today has six 100,000-square-foot buildings dedicated to data centers, and it gladly refers its tenants to Bronco as its preferred install service provider.
“We don’t advertise or chase this work,” Brown said. “We’ll see some bids, but whenever a new company comes in, our card is given out.”
In reference to adding data center monitoring and security systems, Brown said, “Data center owners need to maintain a manageable load to avoid overheating equipment or losing power. To help do that, they want to monitor any power fluctuations, the room temperature and other operations. They don’t want to lose operational efficiencies designed into the center.”
Brown has found that the move to monitoring really kicked in the last year to meet energy-efficiency needs.
“We just completed energy management systems that are monitored in an effort to maximize efficiency,” he said. “Removing heat is critical to operations. Work has included controlling air systems, LED lighting, occupancy sensors, covering holes on the floor, adding insulation, hood vents over CRAC [computer room air conditioning] units, and through efficiencies, even shrinking the footprint of such units.”
Modular data centers
One of Miller Electric’s specialties is modularly built data centers. The company added this service three years ago.
“What we offer is a modularly constructed data room—floor, roof, AC and so on—but built off-site then transported to its location,” Stallings said. “We see this turnkey approach to construction becoming increasingly popular as it shortens construction schedules, prescribes a precise use of materials and offers less construction waste.”
Though traditional containerized centers won’t be going away, Stallings expects modular centers will grow. Companies like Microsoft are aggressively pursuing this style of data center to support its $3 billion commitment to its cloud infrastructure.
“We think you’ll be seeing modular centers as remote or as disaster recovery sites, especially for the bigger firms like HP or IBM,” he said.
Don’t forget the utilities
Willdan’s Sewell added that utilities can be a hidden gem for the EC and its customers. They have data center incentives to help customers affordably tackle energy-efficiency efforts.
“Utilities are motivated to help their customer’s save energy because of state and federal mandates,” he said. “Most of our data center work comes from partnerships we have with utilities. Savings by Design from California Southern Edison is one. ComEd’s Smart Ideas for Your Business in Chicago is another.”
Sewell added that retrofits in particular are huge right now.
“If I had some data center experience as an EC, I’d be all over this market,” he said.
Experience is important. The EC needs to understand data center operations and earn the prospective client’s confidence. Losing power is the worst possible scenario. ECs who know what they are doing and appreciate this work’s complexity will win it and keep it. Companies such as Miller and Bronco stay current and train in whatever the latest technologies offer.
“While a lot of our work comes to us based on reputation, data center facility managers are constantly changing. You need to keep on top of that and build that relationship with each new guy,” said Miller’s Donnie Smith.
It may be time to look into the data center market.