Energy cost is a major factor in data center building. The low cost of oil is going to accelerate the construction of new facilties even further, according to recent analyst reports - which underlines what we’ve said here about the uncontrolled expansion of data centers.

Oil prices have declined by 70 percent since 2014, and this will ensure that power remains cheap, and data centers will continue to grow, according to a report from Canalys. The analyst firm is predicting that data center building will grow by eight percent this year - and the emphasis will be on big data centers, rather than small ones - because energy will be less of a constraint on their costs.

At the start of the year, I pointed out that, while individual data centers are getting more efficient, their total number is expanding so fast, that total energy use is growing. Now, this may or may not be a problem, but it’s true.

I was saying that the growth is effectively not controlled, because these data centers are so efficient, they can provide almost unlimited power. Meanhile, consumer services like Facebook and Youtube delivered by these data centers are effectively free to the consumers, which means they can have pretty-much unlimited demand.

One response I had was that this is a short term anomoy, because energy costs are so low. But with oil prices falling, it seems that isn’t going to change for some time.

Of course, there’s more to it than this, as Canalys analyst Ben Stanton explains: “Oil prices will amplify data center investment this year, but that is just one part of the story. Software-defined environments are unlocking more value in hardware than ever before.”

Virtualization and the re-definition of data centers as software-defined utilities is fuelling a big expansion as well as a rebuilding of the infrastructure.

Canalys also points out that political developments are also driving new data center builds. Awareness that foreign governments (or even our own) are very likely snooping on data, is making customers think hard about where to keep that data, moving it to their own countries, or to other countries (like Germany) which apparently have more powerful privacy regimes.

The move to data sovereignty got a boost from the end of the Safe Harbor agreement between Europe and the US. This was partly a fallout from the Snowden revelations, and cases where US authorities are demanding access to material held in cloud data centers.

Now European companies can’t assume that their data is safe in US firms’ hands, so more data centers are expected on European soil. And Russia has passed a law demanding that Russian citizens’ data is kept within Russia, which should have a similar effect there.

One more comment form Canalys shows how electrical power has become more important than hardware in the data center market. As the hardware becomes more commoditized, it gets cheaper and makes up a smaller part of the value in the data center - even at a time when Canalys points out there is a lot of rebuilding and renewing going on.

While the overall market is expected to grow at eight percent, the market for data center infrastructure is expected to grow at not much more than half of that, by 4.5 percent.

Still that represents a $135 billion market for data center kit.