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Stephen Saunders - Insultant

Of Iceland, Citizenship, $10 Beer, Green IT & the 'Björk Factor'

8/12/2008 24 comments
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Two (2) things "of note" have happened to me recently: First, after 15 years of trying, I finally wore down the Federal Administration to the point that they awarded me U.S. citizenship. Second, I've recently returned from taking my spanking new U.S. passport on its debut trip to Iceland.

Iceland is not to be confused with Greenland. This is easier said than done, given that Iceland is really quite verdant and green, and Greenland is covered in ice... harrumph... It's all highly confusing, and given my newfound status as an American, I now feel fully entitled to suggest loudly, in a shouty twangy accent, that maybe these guys should, like, get with the program and swap names, yeah?

The purpose of my trip was to make another (yet another!) episode of Internet Evolution's "Web Wide World" video series, which basically involves me wandering around the planet with a film crew looking at how the Internet affects different countries and cultures, until the budget runs out or they shut down the Internet -- whichever comes first.

You can view the Iceland video below, but the premise is that Iceland is looking to become the No.1 destination for companies looking to outsource their IT data centers which, as we all know, are the beating heart of the next-generation Internet. The idea is that they will save huge amounts of money by tapping into Iceland's energy grid, which uses geothermal and hydroelectric plants to generate low cost electricity.

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The electricity in Iceland may be really, really cheap, but unfortunately for anyone visiting it (making a documentary video, say) everything else is really, really expensive. In fact, Iceland's just been named as No. 1 on the official list of "most expensive countries in the world." A beer, for instance, costs $10 a pint. (Yes, that's a TEN, which is a lot for a beer, even if it is really good beer, and even if it is called "Viking," which, let's face it, is an absolutely top name, and a fantastic excuse to shout "raaarrrgghhh!" a lot in bars.)

But I digress.

Iceland makes an incredible impression as soon as you get off the plane. For one thing it's a huge island, but it's got a really small population (300,000 people, or less than the work force at GE). Reykjavik, the capital city, is tiny. Björk, its most famous export, is even tinier.

Speaking of whom, you can actually tell how few people live in Iceland by what me and the TV chaps came to know as "the one degree of Björk" factor (like "six degrees of Kevin Bacon," only with one degree, and a Björk).

Example: Ahead of our trip, TV producer James Lambie had been musing out loud in a hopeful sort of a way about whether all the women in Iceland look like Björk. As he arrives at our hotel he sees a small attractive woman and thinks to himself, "Hey, everyone really does look like Björk." And then the penny drops: It is Björk! Ha!

Oh, and then it turned out that our sound engineer on the shoot, Árni Benediktsson, used to be manager for The Sugarcubes, Björk's breakout band. You get the idea. It's a small Icelandic world.

If you haven't been to Iceland, you should: It is undoubtedly one of the most absolutely straight up gobsmackingly beautiful places I've ever visited.

And if you work for a company that's looking to save money on its data center costs and do its bit for the environment simultaneously, you now actually have a good work reason/excuse to get there and check it out (and expense those $10 Vikings).

The video below will give you the full details about Iceland's efforts to become a data center hot spot -- including the hows and whys.

But Iceland has work to do before it becomes a primo destination for data centers (even though Google (Nasdaq: GOOG) and Microsoft Corp. (Nasdaq: MSFT) both have already allegedly visited the country with an eye to locating data center resources there). Mainly, this work involves improving the speed and variety of the fiber optic cables that connect it to the outside world -- something that will happen in 2009.

All of which is interesting, I think, but also is in itself part of another story -- basically, the biggest story of our time.

­Viewed up close and in person, Iceland's geothermal capabilities are jaw-droppingly impressive. But my first reaction was to assume "this is Iceland, this wouldn't work anywhere else." And that's simply not the case. The fact is that Iceland is far from alone in having the capability to generate virtually free geothermal energy.

One of the Icelanders we interviewed for our video was Albert Albertsson, Deputy CEO of the HS Power Company, a founding father of Iceland's geothermal energy industry. He told me that the geological conditions for building geothermal plants are as good, or better, in parts of California and Italy. Then there are its hydroelectric plants -- the largest of which supposedly generates enough electricity to power most of Europe.

And that raises the obvious question: Why persist in a miasmic fixation with fossil fuels bought from repressive regimes with appalling human rights records when better, cheaper alternatives that don't destroy the planet for our children are available NOW. I mean, it's not like no one's suggested an alternative plan.

We didn't cover this "bigger picture" in our video because, ummm, that's not what the video is about. But it bears thinking about, especially for someone who just attained citizenship in one of the biggest users of fossil fuels in the world.

Click below to watch the video: raaarrrgghhh!

— Stephen Saunders, Founder, Internet Evolution

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Insultant
Thinkernetter
Monday June 28, 2010 9:48:28 AM
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thanks Chris - glad you liked it!

Insultant
Thinkernetter
Friday January 9, 2009 1:29:10 PM
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yeah, we need to follow up. Stay tuned.
sfwriter
Rank: Cyborg
Friday October 10, 2008 4:29:08 PM
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Now that Iceland has gone bankrupt, what will happen to its nascent data center market? Any thoughts on whether Iceland still has a future in this area?

viboons
Researcher
Friday August 15, 2008 7:34:14 PM
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You're right that this power line issue is not necessarily specific to green energy. But it's very closly related and certainly one of the main hurdles. On one hand, you have the fast growing demand for power, and on the other hand, there's a real urgent need to go green due to pressures from climate change issues and soaring gas prices. Now, if expensive steam/gas turbine power plants that burn fossil fuels were to be deployed instead of green renewables, they could be located close to the point of delivery, and so there would not be as much a need for new power lines, but the electricity prices would be high at that location and it's not environmentally friendly. Wind farms, for example, can't be just located anywhere but where there's a lot of wind blowing. They generate cheap electricity but transmission lines of greater distance are required to transfer the cheap power to the areas where it's needed. In short, if people want cheap, clean/green/renewable, and reliable electricity, a lot more new power lines are likely to appear in their backyards.

Having said that, building more power lines alone is not the only solution on the table. There's a lot of talks about modernizing the power grid, or widely known as "Smart Grid" - the concept of smart grid is to utilize digital/communication technologies to better manage the grid and improve the efficiencies in operations. The smart grid technologies promise a lot such as slowing down the demand, better managing the peak demand through consumer demand response, better utilizing existing transmission/distribution capabilities and better controls to prevent large scale outages. 

Insultant
Thinkernetter
Friday August 15, 2008 4:15:51 PM
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ok, thanks. But the need to lay new line is not a problem specific to green energy, per se. As you note, it's a result of increased demand for power in general, green or not. I agree that there will havve to be new lines laid to geothermal or hydorelectric plants, but when faced with the scale of the problem that this would solve I would welcome that new line running through or over or under my backyard.  
viboons
Researcher
Friday August 15, 2008 3:03:33 PM
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Thanks Insultant.

Yeah, that's a good question too. Let me put it this way: the phrase "transmission line in your backyard" is often used in the electricity industry to refer to the use of people's land for power line corridors or commonly known as the Right of Way (ROW). Power lines are like pipe lines and they have limited transfer capabilities. With the rapid growth in electricity demand, the existing transmission lines are heavily loaded and many of them are 'congested' (almost like a traffic congestion) to try to deriver reliable power to fuel the economics. So, existing lines may have to be upgraded and/or new lines have to be built. Furthermore, renewable energy resources like wind and solar that are feasible are often at certain remote sites far away from the load centers, where energy is consumed. This requires more power lines to be built. Now, it's politically and environmentally unpopular to make new corridors or ROW's on someone's pieces of land (your backyard) - most people think the tranmission lines are ugly and have other concerns like health/safety, etc, but the main thing is that trees needed to be cut down to clear the corridors, and you can imagine a lot of opposition to that coming from land owners, environmental activists, some policians and lobbyists and so on.

Insultant
Thinkernetter
Friday August 15, 2008 7:14:03 AM
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Yes, climate is a HUGE part of what makes Iceland a good spot for data center location. It's not just cool; it's also predicatbly cool. That's key.
Insultant
Thinkernetter
Friday August 15, 2008 7:12:44 AM
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Viboons,

Great posts.

"More investments in transmission facilities are needed but these things can't happen over night."

Right. So we need to start now.

"everyone wants cheap and reliable electricity but no one wants a transmission line in their backyards."

You don't need different transmission lines... it's the source of the energy that changes, not the delivery point into people's homes, no?

 

viboons
Researcher
Thursday August 14, 2008 4:09:21 PM
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Hey Mr. Roques. good comments. yeah, for most cases, it's true that some solution may seem obvious but when thoroughly analysed, there's often more to it. But we should never rule out a clear and obvious solution either - if it works, why try to complicate things. "Make everything as simple as possible, but not simpler." - Albert Einstein.

And yes, there're many talks about the potentials of shifting the power demand and so reduce the requirement to run expensive power generation units to meet the demand at peak hours. This also slows down the need to invest in the peak generation units. All this can be big cost savings in terms of demand but not exactly energy savings - enery consumptions will keep rising with the economic growth. One example of peak demand curve shifting is the implementation of Plug-in Hybrid vehicles where conceptually people can charge their batteries at night when electricity is off-peak and cheap and drive to work in the morning and may sell back some of the stored energy at the peak hours at car parks. I don't know if this will work with data centers though. According to a report from Lawrence Berkeley National Laboratory, commercial servers in typical data centers seem to use constant power almost through out the day and night (24/7) even if there isn't heavy CPU usage. So, locating data centers in China may not help much in that regard. However, companies like IBM have power management technologies that can scale the power use with the computations being performed by servers.  

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