"Data Centers Are the Autobahns of the 21st Century"... Germany Accelerates with Funds [AIDC Era of Coexistence] 12

"Supporting SME Data Center Initiatives through Fund Creation"

Editor's NoteIn the era of artificial intelligence (AI), the government has announced plans to build data centers with a total capacity of 18.4GW by 2035 as part of three major mega-projects, aiming to make them a key engine for future national growth. Data centers, which previously only functioned as facilities supporting IT services, web applications (apps), and data storage and sharing, are now evolving into industrial platforms that produce and supply AI computing resources. Despite a shared recognition that these centers are core infrastructure determining national industrial competitiveness, there remain numerous hurdles to overcome before the expansion of AI data centers (AIDC) can become a reality. The Asia Business Daily has investigated cases in Finland, Denmark, Germany, and the Netherlands, which have successfully navigated challenges related to electricity supply, permits, water usage, and conflicts with local residents around AIDC. We seek solutions to ensure AIDCs become assets that coexist with local communities in Korea.

Christian Richter Ferench, Team Leader of the Digitalization Department of Hesse, Germany, is being interviewed by The Asia Business Daily. Photo by Seo Sojung.

"Data centers are the Autobahns of the 21st century. We are supporting Hesse so it can play a pivotal role," he said.

The Digitalization Department (HMD), located in Wiesbaden, the capital of Hesse, Germany, is a state government office established to drive digital transformation within the country. Since its launch in 2019, it has served as a control tower leading digital innovation. As of March, the German government announced policies to at least double the total local data center capacity from the current 3GW to 6GW by 2030, and to quadruple AI data processing capabilities.

Christian Richter Ferenchi, Team Leader at the Hesse Digitalization Department, told The Asia Business Daily during an interview in Wiesbaden, "We are discussing the AI agenda and AI regulation within the European Union (EU)," adding, "Much greater investment is necessary if we are to remain competitive."

The data center issue is one that the Digitalization Department is actively pursuing and investing in. Heike Koch, Officer at Hessen Trade & Invest GmbH (HTAI), explained, "There are three major issues regarding data centers in Hesse: eco-friendliness, land use, and energy reuse." She continued, "Because land in Frankfurt is saturated, we are promoting the construction of data centers in the provinces and have set up the Hesse Fund to support regional small and medium-sized enterprises (SMEs) so they can operate data centers." The Hesse Fund is a large-scale public investment and loan fund established by the Hesse state government to support the growth of regional startups and SMEs.

The state-owned Hesse Economic and Infrastructure Bank, which manages the fund, recently provided about 13 billion won for the construction of a new data center by Rhoencloud, a cloud services company. Through this project, Hesse enables regional companies to securely store data within the local area, rather than abroad.

Photo from right: Christian Richter Ferenchi, Head of Digitalization Department of Hesse, Heike Koch, Officer at Hessen Trade & Invest GmbH (HTAI), and Benjamin Fricke, Officer at Digitalization Department of Hesse. Photo by Sojeong Seo.

As efforts to attract data centers to the regions increase, the state of Hesse has also begun the process of revising local tax standards. At present, companies operating data centers pay local taxes based on revenue and number of employees, but going forward, local tax will be assessed based on energy usage. This policy is designed to encourage companies to operate environmentally friendly data centers.

Koch further explained, "Energy reuse is efficient when operating data centers in the provinces, but many areas lack the necessary infrastructure. The fund is helping build this infrastructure so that eco-friendly policies can be designed and implemented."

She also introduced Google's case—turning a former nuclear industry site into a data center. Google operates a large-scale data center in Hanau, an area that used to be the heart of Germany's nuclear industry. After nuclear facilities were shuttered, Google opened its first self-owned data center in Germany in Hanau in October 2023 and has since implemented eco-friendly design initiatives.

Benjamin Fricke, Officer at the Hesse Digitalization Department, emphasized, "Eco-friendly design is a key focus for Germany. Recently, there has been a growing trend of reusing waste heat from data centers for district heating. It is crucial to establish this kind of recycled energy infrastructure."

This feature was supported by the Press Promotion Fund, financed through government advertising commissions.

This content was produced with the assistance of AI translation services.