ASG Group, Vocus confirm customers will take carbon tax hit

Data centre operators now working to help clients with transition period

Data centre operators ASG Group and Vocus have confirmed that they will pass on some increases in energy costs associated with the Gillard Government's carbon tax to customers after 1 July next year.

In-depth: Data centre migration guide.

ASG Group's Perth-based strategic business services general manager, Gerald Strautins, told Computerworld Australia that while the "actual cost impact" through increased power charges was not yet clear, and could potentially vary from state to state, it would have to pass on price increases.

However, he said these increases would be substantially smaller in newer, purpose built facilities, such as ASG Group's new data centre in Perth that opened in March, that are geared to maximise the efficiency of power usage. The new data centre uses an ISO14000 environmental management system and Strautins said it was "constantly looking" at ways to Green its business. "The release of carbon pricing should hopefully now begin to pay commercial dividends," he said.

Now that details of the carbon tax had been released, Strautins said its biggest priority was to help customers with what he described as the "onerous reporting and compliance requirements" that would arise.

"The size of this exercise should not be underestimated and we will utilise our business intelligence [BI] and business consulting capabilities to work with customers to design and implement new systems or extend current systems to deal with this new challenge," he said.

In addition, ASG Group was working with its customer, the Department of Climate Change and Energy Efficiency, to explore future implications such as the Emissions Trading Scheme (ETS.

According to Strautins, one of the challenges for the company could be the introduction of an ETS that links into a global trading regime with associated complications such as foreign exchange, international financial and data security.

"We are in discussions with a number of government agencies are gearing up service delivery around ETS," he said. Strautins was not able to name the agencies at this stage.

However, further developments were happening in the government space for ASG Group as a result of the carbon tax. "We are monitoring the development of Federal Government data sovereignty guidelines which would increasingly mandate more aspects of constituent data remain on shore and the impact that the introduction of the Carbon Tax will have on data centre providers to deliver this efficiently," said Strautins.

"Many companies looking to offshore their data centres as a way of avoiding cost increases caused by carbon tax will need to navigate a potentially sensitive trade off between data sovereignty, security issues and rising data centre costs."

In general, Strautins was positive about the carbon tax as he argued it would act as a catalyst across the IT industry to drive efficiencies through increased take-up of Cloud based computing and virtualization to replace less efficient legacy systems.

"However, there is a worry that the increased costs will drive multinational service providers to shift their Cloud based systems away from Australia to more cost effective locations overseas with all the inherent challenges and risks around data sovereignty and security that this brings," Strautins said.

"There is always a fine line between market forces and government legislation and perhaps there is a question to be asked as to whether enough is being done to protect sensitive Australian data from the offshore drive that the introduction of the carbon tax will no doubt fuel."

Vocus data centre general manager of operations, Adam Gardner, said the company was considering the carbon tax proposal before making a decision on energy costs. However, he said it is "unrealistic to suggest that there will be zero affect to customer pricing".

"We are extremely conscious of the green impact of data centres, and a result, continually review and invest in technology such as aisle containment systems and free air cooling. With the addition of a carbon tax, the priority given to Green IT targets would definitely increase."

Like Strautins, Gardner saw some opportunity for the company as a result of the carbon tax — particularly when it comes to attracting new customers.

"The efficiency of the [Vocus] centres is far greater than that seen by clients attempting to host their own equipment in house. This is primarily due to economies of scale," he said.

NextDC's chief executive, Bevan Slattery, has indicated new but it was not yet known if these costs would be passed on to customers.

Follow Hamish Barwick on Twitter: @HamishBarwick

Follow Computerworld Australia on Twitter: @ComputerworldAU

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