Rising electricity bills are hitting data center and cloud companies in France hard, forcing them to raise their prices. However, the American giants are resisting much better.
It’s a cold shower for Jérémy Martin, head of Techcréa, a company with a micro data center in Marly, in the north. While paying around €90,000 a year for its electricity, EDF estimates its consumption for the coming year at €400,000, more than its data center billing. For three years, Techcréa had benefited from a contract with an alternative supplier based on prices negotiated in 2019, much lower than the current ones. But faced with massive inflation in energy prices this year, his supplier told him he couldn’t renew his contract, due to lack of profitability. However, the amount proposed by EDF, indexed to market prices, would force it to end the activity of its company’s data center, highly valued by many economic players in the Valenciennes economic basin.
And small data centers aren’t the only ones experiencing this increase. “The situation was harmless, it has become catastrophic,” summarizes Fabrice Coquio, CEO of Interxion France, a data center hosting giant that raised its prices by 14% in January. Almost all players operating in France are affected by this massive increase in electricity prices and are obliged to reflect it in their offers.
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This is particularly the case with, which warned its customers of a 10% increase in its prices at the end of the year. Some sources close to the company believe further increases will be needed in 2023. The same goes for Ionos (formerly 1&1), another key player in the cloud computing and hosting sector. “During the first half of 2022, we had an increase in electricity costs of almost 9 million euros in the group,” reports a company spokesperson. “These additional costs have not yet been factored into current prices, but we cannot rule out adjustments.”
At the same time, the American giants[…]