Meta terminates contractor for Danish data centers

Work was already underway, but primary contractor Aarsleff this week announced that its contract has been terminated. The contract was set to be worth DKK 2.4 billion ($343 million).

Facebook-parent Meta operates a 55,000 sqm (592,015 sq ft) data center in Odense that came online in 2019, and announced a 30,000 sqm (323,000 sq ft) expansion in 2020. Then, late last year, it said it would add two more buildings to the campus totaling around 90,000 sqm (969,000 sq ft).

“The work on the data center was in progress and will be stopped immediately as a consequence of the termination of contract,” Aarsleff said in a statement to shareholders that warned it would impact its financial impact. The company entered into the contract on 3 August 2022, with a planned completion date of 2025. It had already carried out earthwork and concrete work, and laid kilometers of cable trenches.

Technically, Aarsleff did not disclose which company it was working with, but there are no other major data centers in Odense, and Meta confirmed that it has ceased development at the site.

“Our existing data centers, including the one in Odense, continue to be the backbone of our company,” Meta’s Nordics comms manager Peter Münster told DCD. “We are currently expanding our data center in Odense with a third building that we expect to complete over the course of the summer of 2023. We have decided not to move forward with the planned expansion beyond three buildings and we will be ending construction work on the two additional buildings.

“Supporting AI workloads at scale requires a different type of data center than those built to support our regular online services. This is why we are focusing our efforts on building a new generation of data centers.”

DCD has asked for further details about whether it is a permanent decision. It is not clear why Meta entered into this contract in August if it plans ‘different types of data centers.’ We have also asked local utility Fjernvarme Fyn about how it will impact its district heating system, which Meta’s facilities were set to contribute to.

“Higher densities require a shift in the way in which we design, build, and cool data centers. In recent years we have seen liquid cooling gaining traction in the industry, to combat the increasing energy demands,” Henrik Hansen, CEO of Danish Data Center Industry, said following Meta’s decision.

“This industry has always been hyper-aware of energy consumption, and this shift does not come as a surprise to us, as demand for AI and other energy-intense applications continue to be rolled out.”

Facebook previously had plans to develop a second Danish campus in Esbjer but scrapped the idea in 2019. However, in 2021 it returned to those plans and acquired 212 hectares of land in Andrup in Esbjer at a price of DKK 277 million ($43 million). This summer it killed a data center project in the Netherlands that was set to be the country’s largest, because of local pushback.

Meta last month announced it would lay off 11,000 employees, some 13 percent of its entire workforce, amid worsening economic conditions, impacts to its business model from Apple, and an as-yet-unsuccessful pivot to the metaverse.

However, the company, whose share price has plummeted, claimed that data center spend would be unaffected by the cutbacks. Data Center Dynamics