IT@Intel White Paper

Intel IT
Data Center Site Selection
February 2014

Selecting a Data Center Site:

Intels Approach
Executive Overview
We have found that a well- Intel IT and Intel Corporate Services, working as a team, have identified a range

defined site-selection process of factors to consider when choosing a data center site. When Intel experiences
growth that requires investment in data center facilities, the project team uses
and a quantitative analysis
this set of factors to select a site that maximizes Intels return on investment.
of factors and trade-offs
can transform raw data These criteria help optimize construction Socioeconomic, workforce, and
and sustaining costs while meeting governmental criteria. The factors
into useful information and
internal customers computing and services associated with the social and economic
insight, enabling informed requirements. They also assist in choosing stability of the region, the availability of
decision making. a site that can accommodate future needs a construction and sustaining workforce,
and concerns. and existing regulations, taxation, and
incentives
When selecting a site, we consider three
criteria to be the most important: The perfect site does not exist, and examining
all the relevant site-selection criteria is
Environmental conditions. The regions
challenging. However, we have found that
climate and history of natural hazards
a well-defined site-selection process and a
Wide area network. The availability quantitative analysis of factors and trade-
and cost of fiber and communications offs can transform raw data into useful
infrastructure information and insight, enabling informed
Power. The availability and cost of decision making. The result is a site choice
electrical power infrastructure that offers the most advantages, beginning
at the preconstruction phase and continuing
We also evaluate the following:
Marissa Mena throughout the life of the data center.
Data Center Architect, Intel IT Site-level criteria. The factors associated
with land acquisition, proximity to threats
John Musilli and resources, and the construction
Data Center Architect, Intel IT
environment
Ed Austin
Site Development and Compliance Manager,
Corporate Services

Jeff Lee
Network and Telecom Services Manager, Intel IT

Paul Vaccaro
Data Center Architect, Intel IT
IT@Intel White Paper Selecting a Data Center Site: Intels Approach

Contents BUSINESS CHALLENGE SITE-SELECTION CRITERIA

Executive Overview.. ............................ 1 Data centers provide the foundation
1
Building on their years of experience
for Intels design of silicon products. in constructing data centers, IntelIT
Business Challenge.............................. 2 In 2012 alone, Intels data centers and Intel Corporate Services have
supported about 550,000 EDA-MIPS collectively identified a range of factors
Site-Selection Criteria . . ....................... 2
(electronic design automation to consider when choosing a data
Our Top Three Criteria. . ..................... 3
meaningful indicator of performance center site.3 Some of these factors
Site-Level Criteria. . ............................. 6 per system) and provided storage for relate to the physical capacity of the
Socioeconomic, Workforce, and 30 petabytes of Design data.2 data center, such as adequate WAN
Governmental Criteria....................... 8 infrastructure and availability of water
Intel IT is dedicated to maximizing the for cooling. Other factors relate to the
Methodology for
business value of Intels data center business operations of the data center,
AnalyzingCriteria. . ................................ 9
infrastructure and to establishing Intel as such as the costs associated with the
Overview of the a leader in data center infrastructure and
Site-Selection Process...................... 9
workforce, water, power, or land.
operationsimilar to Intels leadership role
Quantitative Analysis. . ....................10 in its factories. Above all, data center site When selecting a site, we consider the
Conclusion. . ...........................................11 selection must align with Intels global following criteria to be the most important:
strategy of creating and extending computing
Environmental conditions. The regions
Related Information...........................11 technology to connect and enrich the lives
climate and history of natural hazards
of every person on earth. To that end, Intel
Acronyms. . .............................................11 WAN. The availability and cost of fiber and
IT has transformed our data center strategy
using the following: communications infrastructure
Power. The availability and cost of power
A dramatic shift in the investment model
infrastructure
Adoption of business-driven innovation
We also evaluate the following:
and management
Adoption of new metrics and a unit- Site-level criteria. These criteria are
costing model associated with land acquisition, the
construction environment, proximity to
A holistic dashboard to measure data
resources, and proximity to threats, such as
center health
natural hazards and workforce disruption.
Building a data center is a significant long-
Socioeconomic, workforce, and
term investment. Working as a team, IntelIT
governmental criteria. These criteria are
and Intel Corporate Services maintain a pulse
associated with the social and economic
on the business. When business growth
stability of the region, the availability of a
requires investment in data center facilities,
construction and sustaining workforce, and
the site-selection project team has learned
existing regulations, taxation, and incentives.
the value of using site-selection criteria
Most site-selection factors are interrelated.
IT@INTEL that maximize Intels return on investment.
These criteria help optimize construction and For example, the proximity to good roads and
The IT@Intel program connects IT
professionals around the world with their sustaining costs, meet internal customers an airport can lower the cost of transporting
peers inside our organizationsharing computing and services requirements, and construction materials to the site, shipping
lessons learned, methods, and strategies. accommodate future expansion needs. ongoing parts and supplies after construction,
Our goal is simple: share Intel IT best and managing business continuity.
practices that create business value and
make IT a competitive advantage. Visit 1
Intel defines data center as the following: A secured 3
This paper focuses on site selection; it does not discuss
room used mainly to support production and preproduction
us today at www.intel.com/IT or contact computing, storage equipment for business, and mission-
the numerous data center design best practices that
can significantly reduce a data centers operating cost.
your local Intel representative if youd critical applications and storage of Intel intellectual property.
For more information on Intels best practices for data
like to learn more. 2
See Figure 9 in the white paper Intel ITs Data Center center design, see the white paper Facilities Design for
Strategy for Business Transformation. Highdensity Data Centers.

2 www.intel.com/IT
 Selecting a Data Center Site: Intels Approach IT@Intel White Paper

Numerous decision factors relate to ENVIRONMENTAL CONDITIONS

site selection. In this paper, we discuss Climatethe weather conditions prevailing Cooling Degree Days:
the factors that in our experience have in an area in general or over a long period of One Way to Assess Climate
proved to be the most significant.4 While timeis a key consideration when we look
A cooling degree day is a unit used to
a perfect site does not exist, a methodical for a data center site. We avoid sites that
relate outside air temperature to the
analysis of the criteria and trade-offs experience excessive wind, ice, or natural
energy demands of air conditioning.
can result in choosing a site that offers hazards such as poor air quality, floods,
One popular definition is the amount
the most advantages, beginning at the earthquakes, or volcanoes.
of energy needed to cool a home or
preconstruction phase and continuing
Climate business to a human comfort level of
throughout the life of the data center.
Climate can significantly affect the efficiency 18C (65F).
of data center cooling, which in turn affects
Our Top Three Criteria Whenever we can, we locate data
sustaining costs. Climate can also affect the
Our top three site-selection criteria centers in areas that have the lowest
way the data center is designed (and, therefore,
are the ones that we think have the number of cooling degree days. For
the cost of construction and operation). For
most potential impact on the business example, we considered cooling degree
example, depending on climate conditions, a
continuity, cost efficiency, and days during our last two data center
data center may be able to use outside air
performance of a data center: builds in Guadalajara, Mexico, and
cooling; depending on the prevailing wind
Santa Clara, California. After we choose
Environmental conditions direction, the data center may require active
a general geographic area, we analyze
Fiber and communications infrastructure or passive air supply and exhaust solutions.
cooling degree day charts and data to
Power infrastructure In general, dry, cold climates support the identify an optimal site.
most efficient data center operation. The
Each of these criteria represents a complex
optimum temperature operating range for
set of individual considerations, many of
free cooling is 835C (4095F), and the
which present trade-off decisions. The
relative humidity (RH) should be 20 to 70
following sections describe some of the
percent. Most current data center facilities
analysis we perform when we examine
and IT server equipment are designed to be
these criteria.
used in these ranges. Of course, we check the
specifications of the computer equipment to
be installed in the data center to determine
4
The discussion assumes that the data center will be
built in a remote, an exurban, or a suburban area. its temperature and RH operating ranges.

Intels Hybrid Cloud Strategy

Not all Intel services are hosted internally. Intels hybrid cloud strategy requires Intel IT to weigh the advantages and disadvantages of several factors
when considering cloud computing hosting options. The key consideration is the service itself. If a particular service offers a competitive advantage
to Intel or is proprietary, we will likely host the service internally. If it is a commodity service, we find that the best value results from consuming that
serviceor offering it for usefrom an external hosting source.

Hosting choice is not just about the cost. We also consider speed and agility, whether we host a service internally or externally. For example,
one public cloud provider may be more expensive than another but may offer extra capabilities, such as enhanced performance, reliability,
or security, making that provider the better choice for a particular service. Or outsourced hosting may be less expensive, but for a particular
service that needs the highest level of security, we may need to host that service on our enterprise private cloud.a

The business challenges with cloud computing, as it relates to data center site selection, include understanding the services, the services
locations, and the customers we are required to support. We want to use our resources optimally and support a range of customer business
and technical requirements.
a
For more information on Intels cloud computing practices, see the white papers Best Practices for Building an Enterprise Private Cloud and Cloud Computing Cost: Saving
with a Hybrid Model.

www.intel.com/IT 3
IT@Intel White Paper Selecting a Data Center Site: Intels Approach

When examining climate, we gather weather The prevailing wind patterns also affect where available WAN and other communications
data for at least the previous 10 years if we place economizers. Winds greater than 32 services, we look at the following:
possible. This amount of data enables us to kilometers per hour (20 miles per hour) can be
Capacity. Our high-performance data
determine if the area experiences periodic disruptive, especially if the data center design
centers produce a significant amount of
severe weather events. Ideally, this weather includes free cooling. The wind influences air
network traffic. For example, one of Intels
data comes from a weather station close to flows inside the data center through exhaust
Design centers averages monthly inbound
the potential site; airport weather stations venting. If high-velocity winds occur in an area,
network traffic of 4.10 gigabits per second
are also a source of reliable weather data. we investigate alternative venting solutions so
(Gbps), with a maximum of 6.73Gbps.
that the data center is designed properly from
We also take into account historic severe Outbound network traffic averages
the beginning.
weather events. For example, ancient stone 1.56Gbps with a maximum of 3.26 Gbps.5
markers in Japan warned against constructing We avoid locating Intel data centers in For the WAN, this site uses 30 Gbps of
anything below a particular elevation because areas that experience severe snowstorms WAN bandwidth, divided into three WAN
of the risk of tsunamisand the old warnings and ice storms. These weather events can circuits of 10 Gbps each. In addition, this
proved to be correct. prevent employees from getting to the data site uses 10 gigabytes of ISP bandwidth
center and can also make the power source dedicated to Internet traffic.6
Precipitation is not usually a concern as
unreliable. Any site we choose for a data center must
long as the RH remains in the ideal range.
However, in areas with torrential rains, Air quality can affect the efficiency and have adequate WAN fiber capacity for current
equipment yards may need roofs to protect operational costs of the data center, equipment as well as future needsor at least the
equipment and service personnel. The function, and employees quality of life. In high- ability to add more fiber as demand grows.
site must also have adequate stormwater pollution areas with fine particulates, such as Redundancy. The ideal situation is to
management systems to handle runoff. those resulting from diesel fumes, dust storms, have multiple service providers that use
or heavy pollen, the data centers supply air diverse paths and separate main points of
We also consider the buildings orientation
system requires more expensive carbon-type entry (MPOE), which is the physical location
to the sun. In warm climates, we orient the
filters and more frequent filter changesadding where the service providers circuits are
building so that long expanses of the facade
to initial and operational costs. Other air-quality handed off at the Intel facility. The sites
are not south-facing in full exposure to the
issues we consider include the following: MPOEs should be significantly separated.
sun. Instead, we orient the shorter side of
the building to the south, design support High sulfates and natural corrosives (salts) For example, using a road as the separator
areas on the south side of the building can damage circuit boards. Therefore, we is not considered significant; at our sites
that do not have the same heavy cooling avoid locating sites near oceans. we aim to have one providers MPOE on
requirements as the data center, or do both. the east (or north) side of the site and the
Chemical pollutants, such as automotive
Also, we place the supply air intakes and other on the west (or south) side.
pollution (smog) and smoke from local
exterior plenums in the shadows, if possible. fires, can harm equipment and employee Reliability. In developed countries, service
In cold climates, a southern exposure can health. Therefore, we avoid locating sites in providers typically use right of ways to build
warm the building surface and warm the heavily wooded areas or near large sources and traverse their transmission network.
supply air entering the space if the data of airborne pollution. This land could occur along railways or
center uses air-side economizers. highways, or under power lines. Multiple
CRITICAL FIBER AND service providers often use the same paths,
Natural Hazards COMMUNICATIONSINFRASTRUCTURE which eliminates diversity and reliability
Even in an ideal climate, an area that is Various types of media, such as fiber, during a localized event.
prone to natural hazards may not be a copper, satellite, and microwave, are used in In developing nations, service providers also
suitable building location. Seismic events, WAN connectivity. The type of media used use right of ways for their transmission
floods, tornadoes, hurricanes, and volcanoes may depend on the service provider and its network. But these paths may traverse
can all place the data center as well as capabilities. We prefer physical media (fiber open areas or be in areas under local or
suppliers of power and other services at or copper) over satellite and microwave
risk. Volcanoes are particularly problematic. because the latter can be susceptible
An initial volcanic eruption poses a local
5
These are six-month measurements taken from the
to interference and other atmospheric network devices where the compute servers are connected,
risk, and the resulting ash that is distributed conditions. When evaluating a sites so this traffic is directly related to Design batch jobs.
according to the prevailing wind patterns 6
We separate business and internal traffic from traffic
destined for the Internet, which prevents business traffic
poses a prolonged risk. from competing with Internet browsing.

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 Selecting a Data Center Site: Intels Approach IT@Intel White Paper

Learning from the Mistakesof Others

The following examples illustrate the importance of having a WAN and communications infrastructure that is diverse and reliable:

In the early 1990s an accident occurred at the rail yard just north of downtown Sacramento, California. As a result, many customers
experienced a network outage because their network providers underground fiber was installed along the railroad path. The fiber of a
second service provider was in the same trench, so that service providers customers were also impacted. In this case, even though more
than one service provider was available in the area, using a common transmission path created a risk.
Near the village of Sharana, Afghanistan (about 100 miles south of Kabul), ongoing conflict directly influenced the local community.
Cellular towers were shut down during various times throughout the day (and usually all night), making cellular communications difficult.
Also, safety concerns prevented service provider dispatch technicians from accessing certain areas. The result was an extended outage
that lasted for several months until the area stabilized and the technicians could safely repair the transmission equipment.

regional control that may be less stable otherwise, new substations might have to be fuel into the surrounding soil requires
or secure. (See the Learning from the built at the same time as the data center is expensive cleanup.
Mistakesof Others sidebar). Our goal being built. Fuel cells that use natural gas or liquefied
is to have diverse, reliable WAN and natural gas (LNG) are another energy option.
As part of the site-selection process, we
communications infrastructure.
perform a reliability analysis of the power LNG is more stable than natural gas
In addition, we prefer sites with hardened distribution grid for the geography under and can be transported, but it requires
WAN access points to protect them from consideration. We prefer underground power, storage tanks (usually aboveground).
damage. For example, for better security we which reduces risks from events such as
If natural gas is available, the key
prefer WAN infrastructure to be belowground lightning and bird strikes, tree falls, and theft
considerations include whether the pipes
instead of overhead. We also prefer carriers of copper or other valuable materials.
line pressure and volume (cubic feet per
that install the fiber or copper inside concrete
If redundant utility providers are not available day) is sufficient for the project (both now
or PVC ducts instead of direct burial.
for a particular site, we investigate the and in the future), cost per cubic foot, the
best way to provide backup power using level of redundancy at or near the site,
CRITICAL POWER INFRASTRUCTURE generatorspowered by natural gas or diesel and the distance to the pipeline and gas
Similar to WAN and communications fuelor other energy sources such as fuel hub. We prefer a site that is serviced by a
infrastructure, understanding the cells. We consider the following: main pipeline instead of a purpose-built
vulnerabilities and reliability of the power
Generators can emit carbon dioxide, branch pipeline.
infrastructure components is an essential
carbon monoxide, and particulates, The closer the data center is to the power
part of site selection. Our analysis includes
which are often regulated (see Taxes, generation source, the lower the cost per
review of the power distribution and utility
Regulations, and Incentives). megawatt (MW) rate, because there is less
service offerings up the line.
Fuel for generators can be stored either line loss from resistance and less physical
Ideally, the data centers power grid should infrastructure between the data center site
aboveground or belowground.
be powered by two utility providers with and the utility provider.
good power quality to enable redundancy The advantage of aboveground storage
and reduce risk. The use of two diverse utility is that it is easy to maintain, and fuel When selecting a site, we also consider the
providers (not on the same local grid) can loss can be readily contained if a leak type of power available (hydropower or
negate the need for an uninterruptible power occurs. However, an accident or a fire carbon-generated power). Some countries
supply (UPS), thus lowering construction can damage aboveground storage. impose a carbon tax, which makes carbon-
costs significantly. We prefer a site that is generated power more expensive than
Belowground storage is more secure
served by two utility substations, each on hydropower. (For a discussion of power-
from accidents and theft than
an opposite side of our facility location. related tax credits, see Taxes, Regulations,
aboveground storage but is more
The substations must be sized in a way and Incentives.)
difficult to maintain. If a leak occurs, it
that matches our current and future needs; may be difficult to detect, and loss of

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IT@Intel White Paper Selecting a Data Center Site: Intels Approach

Site-Level Criteria may already be present in an area, but power

Making Trade-Offs Some site-selection criteria are specific to and water are not nearby and are expensive.

No site is perfect, and we have found a certain site. For example, we consider the
criteria associated with acquiring a particular PROXIMITY TO THREATS
that trade-offs are necessary when
choosing a potential site. For example, parcel of land, that parcels proximity to threats In addition to the environmental conditions
the availability of inexpensive labor and resources, the construction environment, already discussed and the risks discussed
might lead to low site construction costs. and sustaining cost considerations. in the sections Socioeconomics and
However, the lack of a sophisticated Workforce, here are some other risks we
labor force can lead to longer LAND ACQUISITION consider when choosing a site:
construction times. Power thats Many areas have only a few parcels of Neighboring land use. If a site is on the
inexpensive may be unreliable. land available for development. When we glide path of an airport or could sustain
look at a potential building site, we first damage from pollutants that originate
Other trade-offs may involve the
consider whether it is large enough to on bordering land, we probably will not
following scenarios:
accommodate the data center building(s) consider that site a good candidate for
Being the second or third major and auxiliary equipment, such as cooling a data center.
construction project in a new towers, generators, and other equipment. In
Security considerations. The need for
location, instead of the first, usually many regions, the parcel must also be able to
excessive security can increase costs. For
means material and labor are readily accommodate stormwater runoff ponds (see
example, in some areas, perimeter fencing
available. However, competition Taxes, Regulations, and Incentives). Finally,
or guards may be necessary to safeguard
for labor and materials can drive the parcel should support the ability to
the property. Or local requirements relating
up prices, and having competitors expand the site in the future, if necessary.
to citizenship and background checks for
nearby can raise concerns about
The location of the site is also an important support personnel and suppliers can make
the safety of intellectual property.
factor. We prefer sites that can support operating the data center burdensome.
In addition, having several high-tech
business continuity if accidents or disasters
facilities in the same area can lead
occur. How quickly emergency responders PROXIMITY TO RESOURCES
to increased employee turnover.
can reach the site is a consideration. We Choosing a data center site must also take
The area containing a potential site avoid locations near a major highway or into account access to several other types
might present several strengths, an elevated highway because potential of resources, including water and public
such as a constitutional government fuel truck accidents pose a significant risk. infrastructure.
and a familiar system of laws, We also avoid locations near a steep slope
low labor costs, high language because the geology may create a potential Water
and education standards, highly risk of mud or rock slides. Water is a key resource for data centers
educated engineering talent, and
The cost of the land is a major criterion. We because evaporation is often the most cost-
a growing middle-class market.
choose sites with an appropriate cost per efficient cooling method. This method uses
However, the same area might
square meter (acre) and prefer sites with a lot of water. For example, a 5-MW design
also present a complex set of
single owners because multiple owners can could use 40 million gallons of water per year
regulations, tax structures, and
slow negotiations and purchasing activities. in a mild climate.
multiple layers of government
entities that could slow negotiation We also avoid parcels with easements
and construction. because they represent potential legal issues
and loss of property due to eminent domain. Saving Water
We also consider the cost to bring Our rigorous climate assessment
infrastructuresuch as power, water, enables us to save 28 million gallons
telecommunications, and fiberto the site. of water per year at our data center in
We often have to make trade-offs (see the Santa Clara, California. The location has
Making Trade-Offs sidebar). For example, a mild climate, which allows us to use
tax deferrals and other incentives can offset outside air as the free cooling solution,
upfront land costs. Or adequate WAN fiber instead of relying on evaporative cooling.

6 www.intel.com/IT
 Selecting a Data Center Site: Intels Approach IT@Intel White Paper

We look for sites that have two water CONSTRUCTION ENVIRONMENT

sources sufficient not only for the cooling Construction processes vary around the world, Understanding the
towers but also for other industrial needs and and we acknowledge that ideas differ as to Construction Environment
the fire suppression system. Such sources quality, schedules, and safetyall of which can
We found it essential to understand
could be external to the site, or, if the site is affect construction cost, quality, and schedule
the impact a large construction project
over an aquifer, we may drill a well onsite. In as well as Intels reputation. Therefore, when
may have on the local economy.
addition to availability, we also consider the choosing a site, we investigate the following:
direct cost of water, the cost of drilling a well In one case, a major high-tech company
Availability of design and contractor
if necessary, and the cost and logistics of decided to build a new data center in
resources and construction materials
managing water waste. an area where construction activity
Permitting processes (see Taxes, was high. As a result, the company
Public Infrastructure Regulations, and Incentives) had to work with Tier3 suppliers in
When weighing the advantages and Local safety and performance standards the local industry. Because these
disadvantages of a site, we consider its suppliers did not have the necessary
Availability of appropriate skilled trades in
proximity to various aspects of public materials or level of expertise for such
appropriate quantities (see Workforce)
infrastructure, including the following: a major project, the company had to
We also consider the costs associated with send an expatriate program manager
Major transportation routes. Proximity site construction, such as the potential need who was originally from that area,
to a major airport or other transportation to build new roads; acquiring, shipping, and in order to effectively manage this
venues, such as railroads, trucking routes, securing construction materials; construction difficult situation with suppliers. The
and distribution warehouses, can improve labor and availability; and securing the site lack of skilled resources also resulted
logistics and reduce the costs associated during construction. in cost overruns and issues with
with shipping supplies (both during
overall construction materials and
construction and over the lifetime of
CONSIDERATIONS FOR SUSTAINING COSTS workmanship, and had an adverse
the data center).
After a data center is built, we expect it impact on the schedule.
Emergency response services. When to remain in operation for many years.
Learning from this experience, the
located nearby, these services, including Therefore, we choose sites that present
company launched a new strategic
hospitals, fire departments and emergency opportunities to lower sustaining costs
objective for future projects. Company
response personnel, and law enforcement, whenever possible. Examples of such
representatives intend to visit the
can provide fast response and rescue times. opportunities include the following:
region, identify the Tier 1 suppliers,
In some cases, Intel may agree to provide
Long-term contracts. A data center and build relationships with them in
funding for fire or police departments.
has the potential for many long-lived advance of construction.
Fulfilling these agreements can increase
contracts for services, such as facility and
initial costs but may be required for the Intel has experienced similar problems,
equipment maintenance, landscaping, and
development agreement, permitting, or and we have learned the importance
utility contracts. Negotiating long-term
construction. of knowing the capabilities and
contracts can reduce the data centers
Military bases. Emergency services located players in the local economy where
operating costs.
on a military base could be dispatched we are going to build. Even though
Transport costs. We analyze the cost and Intel has well-developed standards
off-base to assist other first responders if
risk to ship compute equipment to the site. and methodologies, suppliers may
necessary. In many countries, the presence
We consider logistics, customs, and security. not be able to meet the expectations
of a military base is associated with a stable
area and most likely has a solid utility and Materials costs. We analyze the cost and associated with those standard
communications infrastructure. availability of materials necessary during and methodologies. We strive to be
the lifetime of the data center, such as aware of the economic impact of
Public transportation. This factor might
filters, batteries, and spare parts. our construction projects and the
be important in urban areas where workers
availability of suppliers who meet
might not have a car but less important in
our strict construction requirements.
remote, exurban, and suburban sites.

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IT@Intel White Paper Selecting a Data Center Site: Intels Approach

Socioeconomic, Workforce, maintain chillers, UPS, power distribution

Avoiding Areas with and Governmental Criteria equipment, and more throughout the life
Corruption Another set of criteria that we examine
of the data center.

In the past, Intel has experienced focuses on the following: Security. Security staff help protect Intels
challenges in certain regions where intellectual property and corporate data
Social and economic aspects of a region
bribery is accepted as a common from theft or damage.
Workforce issues
practice and is used to obtain We have found that locating a data center
government contracts. Bribery, in any National, regional, and local governmental near a source of new talent, such as near a
form, is clearly against Intels corporate taxes, regulations, and incentives university or IT training school, can provide a
governance and ethics policies. We These types of criteria are important aspects readily available, skilled talent pool (see the
discovered that in these areas, suppliers of site selection because they can potentially Optimizing the Talent Pool sidebar).
and local decision makers fully expect affect the long-term costs associated with
facilitation payments. If we did not the data center as well as business continuity. TAXES, REGULATIONS, AND INCENTIVES
make these payments, we discovered The local, regional, and national taxes,
we would be held in low esteem and SOCIOECONOMICS regulations, and incentives can affect virtually
receive lower quality service. Based Naturally, we prefer to locate our data every consideration for choosing a data
on this experience, we now avoid center in areas that offer political and social center location. Therefore, as part of our due
constructing data centers or other stability rather than in ones that are prone diligence when researching potential sites, we
projects in areas where local business to riots, crime, or corruption. We have found include these items in our analysis.
practices are not conducive to the it best to locate data centers in regions that
construction that follows site selection. are characterized by moderate economic Taxes
conditions. Small economies may not Local, regional, and national governmental
support the necessary level of services, entities can all levy taxes. In general, we have
Optimizing the Talent Pool supplies, and workforce; expensive found that the lower the taxation rate, the
economies may drive up the cost of lower the data center cost. In particular, we
Intel has developed a feeder program
building and sustaining the data center. determine whether data center equipment is
in its efforts to enhance the quality
taxed as property and whether a sales tax is
and effectiveness of its hiring program
WORKFORCE applied to construction materials, data center
for college graduates. Intels programs
To construct and operate a data center, we equipment, and ongoing data center supplies.
provide internship experiences to
need an adequate supply of skilled workers We also investigate whether tax incentives
students at the freshman and
and a stable workforce. Therefore, we already exist or can be negotiated.
sophomore college levels. Intel also
carefully research the available workforce in
encourages employees to volunteer
the area to determine if the skills we need Regulations
and support local schools. For example,
exist, if wages are affordable, and if any Like taxes, regulations can be enforced
employees participating in the A Day in
workforce stoppages have occurred recently. at the local, regional, and national levels.
the Life of an Intel Employee and Junior
Regulations that we consider when choosing
Achievement programs prepare lesson The following list gives examples of the
a data center site include the following:
plans to teach students for a day. types of workers we need to build and staff
an Intel data center: Land and title zoning. Obtaining the
By locating an Intel facility near a
correct zoning for a particular parcel of
university, our employees can more Construction. Skilled workers, such as
land requires engagement with the local
easily interact with students and framers, concrete workers, electricians,
authority having jurisdiction (AHJ). Before
foster a positive impression of the and plumbers, contribute to a successful
discussions with the AHJ begin, we develop
engineering profession. The results construction project.
an understanding of the current zoning
are far-reachingstudents around the Information technology. IT personnel, such and the appropriate processes for change.
globe receive encouragement, and more as network staff, system administrators,
students remain in their engineering Water. Some areas may regulate water
and data center architects, help keep the
and finance programs. Most importantly, usage and waste. Also, stormwater
data center running after it is built.
Intel, the students, and the educational regulations can affect the size of the
Facilities and maintenance. Facility land parcel required. Storage ponds can
community forge lasting relationships.
technicians and other maintenance staff take up as much as 40 percent of a sites
8 www.intel.com/IT
 Selecting a Data Center Site: Intels Approach IT@Intel White Paper

land. These types of regulations can also These regional, national, and local incentives METHODOLOGY FOR
stipulate specific landscaping requirements. can help offset taxation and other costs.
ANALYZINGCRITERIA
Fuel storage and emissions. These In our experience, incentives can take the
Examining all the relevant site-selection
regulations vary by city, county, and region, form of land, cash, and tax reductions or
criteria may at first seem overwhelming.
and can be associated with significant deferrals. Incentives can also be services,
But a methodical approach to analysis
fines for infractions. such as customs, training, or permitting. For
can help make sense of this diverse and
Local restrictions. Some areas may have example, a county might waive traffic impact
sometimes contradictory data. We have
building height restrictions, and local zoning and permitting fees, or a region might offer
a well-defined site-selection process,
may restrict certain power options such tax credits for technology implementation
during which we narrow down a long
as solar, smart grid, micro-grid, natural gas and energy savings. As another example,
list of potential sites to a few. We use
power generation, or fuel cells. Additional the use of photovoltaic (solar cells) may
quantitative analysis to transform data
permitting may be required for clean energy. be associated with rebates or incentives.
into information and insight, which
Some locales restrict data center capacity However, the incentive may not be enough
enables us to make informed decisions.
and the number of allowable data centers, to compensate for the space requiredsolar
because of the power density that a cluster power requires about 20,200 square meters
of data centers or a large data center (five acres) per MW. Overview of the
create. Zoning requirements may also exist When selecting a data center site, we Site-Selection Process
for communications technologies, such as research what has been done before with At Intel, we use the process illustrated in
satellite, infrared, and microwave. regard to incentives in each area being Figure 1 to select a site. When the need for a
considered. Then, when we have reduced data center arises, we first define the scope
Customs regulations, fees, and tariffs.
the potential number of sites to just a few, of the project, and then we start the site-
These requirements can affect the logistics
we engage with the relevant economic selection process. Using the criteria discussed
of transporting equipment in and out of the
development agencies to understand in this paper, we narrow down our focus
country, both during and after construction.
the details, request proposals, and make from a world scan to a short list of specific
Incentives counter proposals. locations. Once we have this list, we assess
Areas that are pro growth and pro business the infrastructure and, if possible, negotiate
However, incentives are only one of many
generally offer incentives to attract major incentives with the appropriate governmental
considerations and do not carry excessive
construction projects that will potentially entities. This step leads to the development
weight in our analysis. As Brian Krzanich,
create a significant number of family-wage of the comprehensive net present cost of
the former general manager of Assembly
jobs, generate local investment in community each alternative and a recommendation to
Test at Intel, said, Government incentives
resources such as education and healthcare, the Intel decision maker.
can come and go. Decisions need to be
and provide steady tax revenues over time. long term.

Need
Construction
Identication

Scope Infrastructure Incentive

Handoff
Denition Assessment Negotiation

World Scan
Site (Location)

City Scan Location Scan Net

Country City Site Site
Present Cost
Short List Short List Short List Selected
Evaluation

SITE-SELECTION PROCESS NEGOTIATION PROCESS

Figure 1. A well-defined site-selection process enables us to narrow down a global list of sites to the few that best meet our site-selection criteria.

www.intel.com/IT 9
IT@Intel White Paper Selecting a Data Center Site: Intels Approach

Table 1. Sample Utilities Infrastructure Spreadsheet After a site is selected, we make the land
SCORE
purchase and hand off the project to the
Utilities
Infrastructure Parameters OPTION 1 OPTION 2 Resolution Path construction manager, who must ensure the
Power Reliability project complies with the scope, schedule,
Power Quality and budget requirements associated with
Alternative Energy Options constructing and operating the data center.
Electricity Rate Price
Power Infrastructure Cost
Power Infrastructure Timing
Quantitative Analysis
Power Available Capacity For the detailed analysis of the sites on the
Percentage of Utility Load short list, we engage content experts from
Utility Financial Stability the various business groups at Intel. They
Privatized/Deregulated/Monopoly investigate the existing and forecasted
Power Customer Service
conditions at each site in a variety of areas.
Power State-of-the-Art Equipment
We then use a spreadsheet to score and
Future Stability of Power Resource
Power Line Specifics rank each site-selection criteria for the
Water Reliability sites under consideration. We create a tab
Water Infrastructure Cost for each general criteria category, such as
Water Infrastructure Timing utilities and environmental hazards, and
Sewer Reliability develop a rating system. Each line item on
Sewer Infrastructure Cost
a tab receives a ranking.
Sewer Infrastructure Timing
Natural Gas Reliability and Capacity Table 1 shows a sample of such a
Natural Gas Rate Price spreadsheet, relating to the utilities
TOTAL SCORE infrastructure. We give each criterion a
AVERAGE SCORE
score for multiple site options, with notes
recorded as appropriate. Table 2 illustrates
Table 2. Sample Ranking System a possible ranking system. Each scoring
Ranking Definition Resolution Path
column has a total score and total average
score calculated at the bottom of the tab.
Potential show stoppers
1 HIGH RISK No resolution path developed When the tabs and rankings are complete, we
Requires immediate focus use a weighting system, similar to the one
Detailed solution path developed but not fully demonstrated shown in Table 3, to roll up all the individual
2 MEDIUM RISK
High confidence level for success rankings into a general recommendation for
3 the best site.
Fully demonstrated capability
4 LOW RISK Using this weighting system, we were able
Meets or exceeds boundary conditions
5 to rank and filter a list of 181 possible
countries in which to locate a new facility,
into a list of only 24 countriesa much more
Table 3. Sample Weighting System
manageable number for further analysis.
Category Weight Explanation The weighting system helped eliminate
Talent 45 percent Engineering graduates and school ranking countries with relatively small or expensive
Cost 25 percent Gross domestic product per head count 18 percent economies, those associated with high risk
Country gross domestic product - 7 percent (such as personal, transportation, property,
Risk 15 percent Personal and business risk and business risks), and countries with low
High-Tech Job Creation 15 percent High-tech jobs created by the local economy talent and job-creation levels.
(having other high-tech employers in the area is preferable
because they provide an established talent pool)

10 www.intel.com/IT
 Selecting a Data Center Site: Intels Approach IT@Intel White Paper

CONCLUSION RELATED INFORMATION

Analysis in Hindsight Visit www.intel.com/IT to find content on
When Intel experiences growth that
Our information gathering and analysis requires investment in data center related topics:
continues even after we select a site. facilities, we use a set of site- Facilities Design for High-density
In order to test our assumptions and selection criteria in order to maximize Data Centers
decisions, we analyze the operational our return on investment. These Intel ITs Data Center Strategy for
efficiency of a data center several criteria help us choose a site that Business Transformation
years after it is built. This after-the- optimizes construction and sustaining
Improving Business Continuity with
fact analysis can supply insights and costs, meets internal customers
Data Center Capacity Planning
help hone the site-selection process computing and services requirements,
for future projects. and accommodates future expansion. For more information on Intel IT
For example, at one site that we were best practices, visit intel.com/IT.
We have found the following criteria to be
expanding, our uninterruptible power
the most important:
supply battery replacements exceeded
our original estimates, putting us at Environmental conditions. The regions
risk for exceeding our hazardous waste climate and history of natural hazards.
permitting allocation. Tracking battery WAN. The availability and cost of fiber CONTRIBUTORS
replacement might seem like a trivial and communications infrastructure.
Tom Parsley
detail, but it underscores the need to
Power. The availability and cost of DCM Engineering Manager, Intel IT
understand the permitting associated
power infrastructure.
with a site. It also shows how
important it is to understand what is We also consider site-level criteria (those
ACRONYMS
being added during an expansion and factors associated with land acquisition,
proximity to threats and resources, and the AHJ authority having jurisdiction
what the future ramifications of such
construction environment) and socioeconomic, EDA-MIPS electronic design
an expansion are.
automationmeaningful
workforce, and governmental criteria (such as
indicator of performance
regulations, taxation, and incentives).
per system
While no site is perfect, our well-defined Gbps gigabits per second
site-selection process and a quantitative LNG liquefied natural gas
analysis of factors and trade-offs result in a MPOE main point of entry
site choice that offers the most advantages MW megawatt
from preconstruction throughout the life of RH relative humidity
the data center. UPS uninterruptible power supply

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