Igor Grdić (Vertiv): Croatia is becoming one of the key destinations for data centers in Europe

In parallel with the growing interest in the development of generative artificial intelligence, which could reach a value of 1 to 3 trillion dollars by 2032 according to some estimates, the need for ‘storing’ this data in dedicated data centers is also increasing, which consume up to five times more electricity due to AI. Considering the fact that Western Europe is turning to green and digital technologies (for example, electric vehicles), due to insufficient sources of electricity in that part of Europe, data centers that consume more and more electricity are slowly moving towards Central and Eastern Europe, and thus to Croatia.

For example, the American company Digital Realty is building the largest data center in the country in Zagreb’s Jankomir with a capacity of up to 30 megawatts, incomparably larger than all the remaining few data centers in Croatia combined.

That Croatia is quite well positioned on the map of Europe regarding data centers is confirmed by Igor Grdić, regional director for Central and Eastern Europe and a member of the Management Board of Vertiv Croatia, which designs, develops, and manufactures equipment for data centers. The demands of data centers for electricity come on two fronts – for powering and cooling internet equipment – and this is precisely what Vertiv deals with.

– If we don’t work, the internet goes down – described Grdić during today’s presentation of Vertiv’s results, as well as the latest trends in the data center market.

From Rugvica to the world

In addition to ensuring enough electricity for powering, currently one of the main challenges for data centers, as Grdić explained, relates precisely to cooling equipment. Namely, due to significant heating, the only solution is water cooling, which on the other hand brings the challenge of maintaining equipment submerged in a special cooling liquid, and there can also be oxidation and flammability. For several years, Vertiv has been designing and producing modular solutions for water cooling in its production facility in Rugvica, and exports products to the EMEA market (Europe, Middle East, Africa). They are partners with Nvidia and Intel, chip manufacturers.

In addition to cooling systems, the heat generated by the operation of data centers could also benefit the local community for, say, free heating. Also, in addition to jobs, there are increasing demands for such benefits from data centers that are emerging here. Grdić emphasizes that this is infrastructurally extremely demanding, but feasible and quite possible.

The Croatian branch of the American company Vertiv achieved good results in 2023, but the exact amounts of revenue and profit are still unknown, as the financial report has not yet been published. The entire group, with a total of 24 production facilities worldwide, achieved revenues of 6 billion dollars in 2023.

In addition to the Zagreb facility, there are facilities in Italy, the Czech Republic, Slovakia (the largest in Europe), Ireland, the Middle East, the USA, Mexico, India, and China (where the largest facilities are located). Vertiv employs 27,000 employees worldwide, while in Croatia, it counts between 550 and 600 people. However, like many other Croatian manufacturing companies, there is a significant shortage of quality workers in the electromechanical field, as well as assemblers, testers, and even construction workers, so they hope to increase the number of employees this year.

– In Croatia, we have people who know what data centers are and know how to manage them, and we are known for that in the world – said Grdić.

Soon also an association

To emphasize the needs of the data center industry when it comes to legislation, or to ensure that professional perspectives are considered in legislative decisions, Grdić announced the establishment of a Croatian association for data centers in the first half of this year. He is founding the association with Goran Đureski, director of the aforementioned company Digital Realty for Croatia and the region, and Filip Olujić, executive director of the data center DataBox.

With joint action towards lawmakers, the idea is to determine the total capacity of all data centers in Croatia. According to rough estimates, it is about five to ten megawatts of capacity, but it is very difficult to calculate these data precisely.