Nammo, one of Europe’s leading ammunition manufacturers, said it is struggling to expand its plant in Norway due to a data center that is consuming much of the electricity available in the area, and whose main customer is the social network TikTok. To the Financial Times the managing director of Nammo, Morten Brandtzæg, he said: “We are concerned as we see our growth opportunities challenged by kitten videos.”
Like other ammunition manufacturers, too Nammo in recent months it has significantly increased its production due to the war in Ukraine. The company is owned by the Norwegian government and a Finnish government-controlled company, has various manufacturing facilities and is working on expanding its plant in Raufoss in central Norway. However, servers (Internet-connected computers that manage data) dedicated to TikTok in a new data center built in the area consume a lot of electricity, making it impossible to supply the necessary supplies for the expansion of the Raufoss plant.
Brandtzæg said the demand for ammunition for artillery pieces had increased 15-fold compared to the period before Russia’s invasion of Ukraine in late February 2022. It is estimated that the munitions industry in Europe needs to invest at least €2 billion in building new plants, or expanding existing ones, to meet growing demand. The new factories will need electricity and will have to deal with other industrial activities that consume a lot of it.
TikTok plans to build three data centers in Norway this year and could build two more by 2025 in an area not far from Raufoss. The social network, which is owned by a Chinese company over which the Chinese government exercises strong control, is booming in Europe and needs new infrastructure to store user data and support the millions of videos that are uploaded to his system every day.
Norwegian energy company Elvia confirmed al Financial Times that the electrical grid currently does not have the capacity to carry the loads needed for other high-drain activities, in addition to those of the data center. The company that runs it simply made deals before Nammo did, and consequently takes precedence over supplies. Expanding the distribution network in the area should solve the problem, but it will take time: not only Nammo, but also other nearby companies are in trouble.
According to Brandtzæg the government of Norway should adopt specific policies, giving priority to some industrial activities over others. In the meantime, the local authorities have undertaken to evaluate the situation and find a solution that will allow Nammo to proceed with its expansion, even if it is not clear how soon.
Northern European countries are quite coveted by technology companies, because until recently the low cost of energy and climatic conditions made them ideal places to build data centers, which need to cool the servers. In recent years, companies more involved in the energy transition, such as those that produce batteries, have joined these, leading to an increase in the demand for electricity, which is becoming an increasingly contested resource.