UAE set to attract more data centre investments, with sustainability efforts in focus

Data centres have become one of the world’s most valuable resources, says Khazna chief executive

Khazna's stand at the Gitex Technology Week in Dubai on Monday. The company plans to establish a presence in new markets outside the UAE. Leslie Pableo for The National

Abu Dhabi’s Khazna Data Centres, one of the largest data centre operators in the Middle East, expects the UAE to become a top destination globally for the industry, its chief executive has said.

The Emirates' data centre industry, already one of the biggest in the region, is being driven by government support and investment, plus the adoption of key technology such as the cloud, big data and the Internet of Things, Hassan Alnaqbi told The National at Gitex Technology Week in Dubai.

“Data centres have become one of the world’s most valuable resources as they enable e-commerce, cloud computing and remote work, and also drive the global economy,” he said.

“Due to the staggering amounts of data generated around the clock, the UAE will see more investments in data centre infrastructure as businesses are increasingly aware of the need to manage data and information efficiently and cost-effectively.”

But while data centres create digital opportunities and connections for businesses to scale up their operations, their environmental impact should be taken into consideration, since it is an energy-hungry industry, Mr Alnaqbi said.

Khazna currently operates 12 data centres across the UAE, with a total planned capacity of 300 megawatts by the end of 2023.

“As data centres help businesses meet growing consumer demand, they turn into one of the largest per capita consumers of electric power. Sustainability is the need of the hour.”

GCC states, especially the UAE, are attracting a large number of global technology companies because of the rise of technology-focused young consumers and an evolving digital landscape in the region.

Data centre companies have been a key factor in helping economies to keep up with the rapidly evolving digital landscape.

The UAE's telecom operators have already ventured into data centres.

Abu Dhabi-based e& by etisalat, the UAE's biggest telecom operator, partnered with artificial intelligence company G42 to create the Emirates' largest data centre network under Khazna, while Dubai's du has opened two of its own.

A number of global technology organisations, including Amazon, Microsoft and Oracle, have also flocked to the UAE to set up data centres to support the country's technological push.

“The demand for data centres is growing exponentially, driven by high levels of technology adoption, the rollout of 5G, the localisation of data and the growth of internet-based companies,” Mr Alnaqbi said.

Location also matters: in theory, a data centre can be built anywhere with power and connectivity, he said.

But while considerations such as services offered, connectivity options and technical support are all important, the physical location of a centre should not be underrated as the “location has an impact on the quality of service that the facility can provide to its customers”.

“Technology that enhances flexibility, speeds up time to market and provides better overall performance serves as a strategic differentiator for organisations,” Mr Alnaqbi said.

“Companies must be more agile, both in how they run their businesses and in how they take advantage of expansion opportunities despite supply chain issues."

Khazna did not disclose how much it plans to invest in its expansion, but said it is gearing up to establish a presence in new markets outside the UAE, including in Saudi Arabia, Kuwait, Egypt and Indonesia.

“As important as environmental sustainability is to the industry and to regulators, business sustainability is critical as well,” Mr Alnaqbi said.

“Data centres and regulators will have to work together to create measurable goals, support initiatives and track progress towards objectives.”