Digital Realty Investment in Singapore and Emission Issues

Digital Realty is a global real estate investment firm that provides data center facilities, cloud computing infrastructure, and interconnection services to companies worldwide.

It was founded in 1998 and currently has over 4 million square feet of data center space across 23 North American and Europe facilities. Digital Realty’s recent investments include $1.5 billion for its newest data center campus in Amsterdam and $2 billion for its largest campus yet in London.

Digital Realty is expanding its presence into emerging markets in the Asia Pacific by forming partnerships with local operators like CBRE Capital Markets (CCM). They help identify opportunities for growth capital investment in emerging markets.

Through these partnerships, Digital Realty aims to establish a network of data centers across South East Asia that will provide cloud computing infrastructure and interconnection services between major cities such as Singapore, Hong Kong, and Tokyo.

Digital Realty Investment in South East Asia

Singapore is a hub for financial services, with the country’s economy growing at an average rate of 3.8 percent per annum over the past two decades. It is home to some of the world’s largest banks, including DBS Bank and OCBC Bank, as well as many other major financial institutions. The country also has one of the highest levels of foreign direct investment (FDI) in Asia and boasts a robust real estate market.

Digital Realty has been investing in South East Asia for the last ten years. It has invested in Singapore, Malaysia, and Indonesia. The company is looking at other regional opportunities and is currently evaluating options in Thailand and the Philippines. The company also looks at markets like India, China, Vietnam, and other parts of Asia.

Digital Realty Trust's most recent investment was to acquire 100% of Digital Realty Trust-Indonesia for $4 million. The company said it would use this platform to expand its presence in Indonesia through its data center services, managed-to-host services, and cloud computing solutions.

The company has invested in high-performance computing infrastructure and security technology such as Domain Name Servers (DNS) in the past few years.

Carbon Emissions Problem

The rise of the digital economy has led to a massive increase in data centers. The amount of power required to operate these facilities is increasing, putting an undue burden on the environment. The effects are especially noticeable in Singapore due to its tropical climate and dense population.

According to Greenpeace, one-third of the world’s energy consumption is in data centers. Experts expect this figure to double by 2030 as more companies move online operations.

At the same time, there are concerns about how much carbon dioxide these facilities emit into the atmosphere. As such, there have been calls for more effective regulations on data center emissions and improved technology to reduce their impact on our environment.

Source: Marissa Donnelly

According to the Singapore Government's Ministry of the Environment and Water Resources (MEWR), Singapore is one of the top ten countries in the world that contribute to greenhouse gas emissions. The country has been struggling with this issue for years and has tried various strategies to reduce carbon emissions.

One of these strategies includes adopting clean technology solutions such as solar power generation, waste recycling, and energy efficiency measures such as LED lighting in buildings. Another strategy is to promote electric vehicles by providing charging stations across the island.

The government also announced last year that it will be reducing its carbon footprint by 2030 through initiatives such as reducing its energy use per square meter by 40% over 2015 levels and increasing its share of renewable energy sources up to 15%.

Conclusion

The main problem besides carbon emission is data center expansion; Singapore halted a new data center development.

According to the study by ClimateWorks, Singapore’s carbon emissions from IT infrastructure will increase by 20% between 2017 and 2025. This is because of the country’s growing demand for data centers.

The Government has an ambitious target to reduce our emissions intensity by 36% from 2005 levels by 2020. We are also committed to reducing our overall emissions intensity by 40% from 2005 levels by 2030 under the Paris Agreement on Climate Change (or "Paris Agreement").

Does this mean that Digital Realty should start investing in a green data center in Jakarta, Indonesia?

See: advantages of green data center