Decentralized cloud computing: the feasibility of heat recovery
Partner organisation: DeepSquare
The cloud computing industry poses important environmental challenges, among which the issue of energy efficiency. The current large scale data centers that are commonly used by the industry need an additional 57% of energy just for cooling the servers. At the same time, the heating market in Switzerland needs to transition to more efficient and sustainable practices if it wants to meet decarbonization goals and decrease dependency on the import of foreign energy sources.
DeepSquare aims at offering High-Performance Cloud Computing (HPCC) in a decentralized way to break with the current trends of market concentration. Moreover, the startup aims at reusing the surplus heat generated by servers for various heating purposes. Thanks to the decentralized infrastructure that is being tested, the HPCC units can be installed close to infrastructures with an important heating need, such as residential heating, greenhouses, large hotel, and spa centers, etc. DeepSquare is currently completing proof-of-concept sites where the technology is being tested. Even though the heat recovery technology is not yet fully optimized, the results are very promising.
The key objectives of the project were twofold. First, to identify the different locations in Switzerland that are suitable for installing such decentralized HPCC units. They need to be close to a high-speed internet connection and a heating need that fits the heat characteristics of the server units. A first achievement of the project has been to define standard location criteria. Second, the project aimed at developing an appropriate business model to sell HPCC capacity and serve the heat needs. The results indicate that a leasing business model would be appropriate in the next phase of growth. DeepSquare would partner with utility companies that invest in the HPCC hardware and who would connect them to heating systems. This model would allow DeepSquare to further test and improve the technology and to partially share the risk of hardware ownership with the utility company. There has already been a significant demand for decentralized heat sources by residential housing units. The utility companies would be well positioned to serve this first market. As DeepSquare further grows, other business models would need to be developed.
Overall, while heat recovery is still at an early stage in Switzerland, this project shows that there are business models that can make it financially viable in the middle term.
Academic supervisor: Suren Erkman
Transformative Projects’ Lead: Samuel Wicki