May 23rd, 2014

Sweden considers huge energy tax cuts to lure data centers

In anticipation of a high demand for data center space in Europe over the next decade, the Swedish government is considering changes to its tax code to make Sweden even more attractive to data center builders.

A newly appointed government commission is to study the feasibility of a massive electricity tax reduction – from the current 20 cents SEK per 1 kWh to 0.5 cents SEK – according to a spokesman for Business Sweden, an organization that promotes and facilitates business investment in the country. “Today the Swedish government has appointed a commission to investigate the possibility that even service companies should be able to take advantage of the lowest tax rate for electricity use,” said a Business Sweden spokesperson.

Swedish newspaper Dagens Industri quoted Minister of Finance Anders Borg saying the review of energy taxes was intended to make Sweden more competitive than its Nordic neighbors.

There have been several data center establishments in the Nordic region in recent years. Nordic countries are attractive for data centers primarily because of their low cost green electricity and cool climate, which allows free cooling much of the year. In particular, Gävleborg also offers a highly reliable power grid, world-class fiber network and close proximity to Stockholm Arlanda.

The government is also considering lowering corporate tax from 22 percent to 20 percent, according to the Business Sweden spokesperson.

Read more about specific Data Center opportunities in Gävleborg

News source (external website)