Data centre booms and decarbonising the supply chain

ATC MD Keith Young discusses the key trends that contributed to the surge in data centres and his company’s €22.5m investment to electrify its vehicle fleet.

The data centre sector has soared in recent years, becoming an vital component for some of the biggest companies in the world.

The demand for these facilities has been growing thanks to multiple factors, with the growing popularity of cloud, remote working and more recent tech trends – AI – all contributing to the sector’s steady growth.

One company that has witnessed and supported the colossal rise of data centres is ATC Computer Transport & Logistics.

Founded 45 years ago, ATC is a transport and logistics firm supporting data centre operators, high-tech freight forwarders and original equipment manufacturers. The Dublin-headquartered company began expanding to Europe over the past decade and now employs roughly 250 people across 10 countries.

The company is focused on expanding its operations further and also aims to achieve net-zero carbon emissions by 2030. To support this goal, ATC has announced an investment of €22.5m over a five-year period to support the transition of its global transportation fleet to electric vehicles.

Keith Young, the MD of ATC and the son of its founders Alan and Patricia Young, said there has always been a focus of investing back into the business. He said the investment is part of its broader “ATC 360” plan, the company’s strategy for 2023 to 2026.

“So, the three is we want to expand the company to over 300 people,” he said. “The six is for a turnover to grow to [more than] €60m and the zero is the aspiration – the net zero carbon emissions, and that one is by 2030.”

Data centres – wave after wave

Young became MD of the business in 2019, but was involved in the company even at a much younger age – “you’d never get away with it now”. But before he took the reins of the company, he felt he needed to have his own career and experience, which prompted him to work for various companies including Apple and Wriggle Learning.

He also completed a PhD in education and mobile learning while working part time for ATC. It was during this period that the company began to alter its focus thanks to the rise of data centres.

“Where it is today though is really shaped by the pivot coming out of the recession, so 2012,” Young said. “The scale of the computer industry changed as data centres came to Ireland. That’s when we began working within the data centre sector exclusively, and things kind of migrated from there.

“It’s over the 12 years since 2012 that our footprint has actually solidified with subsidiaries, with local offices, with local employees.”

Young said his company has benefitted from the trends that spurred the growth of data centres. He feels that the period of companies migrating their IT services to the cloud is one that’s still ongoing, but that another boost came thanks to the rise of remote working during the Covid-19 pandemic.

“There’s a little bit of a rebalancing on that now, but for us in Ireland anyway, and especially in our business, we’ve kept remote working because we’ve seen it as being really beneficial for the culture of our office-based staff,” Young said.

But the major boom came last year with the rise of ChatGPT and the subsequent push for generative AI technology. Young said the sector saw a “new investment cycle into the equipment needed for AI and machine learning”.

“We were already on the back of one wave, and then this other wave comes along, and we have never been busier,” he said. “And we seem to be in an arms race for companies to get their AI offering to market and then earning revenue. One or two of them are really pushing ahead with products that are integrated for the enterprise.”

Decarbonising the supply chain

But while data centres are important for modern society, there are also various challenges facing the sector. Young noted that the availability of power is a key issue, with roadblocks for new data centres developing in places such as Ireland and Amsterdam.

Another issue is a “PR challenge” – the fact these centres are a major drain on electricity grids. For example, data centres are consuming more than a fifth of Ireland’s electricity.

“I think they are trying to work to change that narrative to say that, actually, these data centres are powering your electronic health initiatives,” Young said. “When you like a video on LinkedIn, which is a remote surgery from halfway across the planet that’s supported by this digital infrastructure, or when you want new online services from government, that that’s going to be built on the data centre footprint and the capability. So they’re working on how they’re perceived.”

Young said one part of this “very giant machine” is the supply chain and that is where ATC’s five-year investment comes in. The company has added multiple EVs to its fleet thanks to a mix of its own funding and Government grants, including the Zero-Emission Heavy Duty Vehicle Purchase Grant Scheme.

“As a business mainly involved in transport and logistics, 90pc of our emissions come from road transport, so from trucks,” Young said. “And critically, those are all scope 3 emissions for our clients, so they own them.

“So it’ll come as no surprise that the bulk of the €22.5m investment over five years is going to be focused on decarbonising logistics.”

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