40 implications to protect their users’ data, effectively costing them a small fortune to update to meet these requirements. To prevent this situation from occurring in the US, companies have to date successfully blocked the federal government from passing a similar act. However, many states have come up with similar regulations. Currently, Alaska has some of the strictest personal protection laws with its Constitution and Personal Information Protection Act, limiting the ability of what these companies can do with data (Alaska Personal Information Protection Act, 2009). Governor Michael Dunleavy introduced the Consumer Data Privacy Act in March of 2021. This bill, which failed to pass and was resent to the Alaskan House of Representative Judiciary Committee to be rewritten, places additional restrictions on data stored within the state, thereby further reducing the likelihood of one of these companies choosing Alaska over a different state with more limited data protection requirements. On the other hand, for data that already exist from places, such as the EU, that have stricter requirements, if the cost is cheaper to store it in Alaska than in Europe, there still is a compelling business case. Finally, the biggest issue facing the development of data centers in Alaska is the relative lack of corporate experience. There are only three data centers in the entire state; all are in Fairbanks and operated by two companies. None actually hosts individual servers or has rack cabinets, illustrating their limitations (Alaska’s Data Centers, 2022). Compounding this issue is a lack of qualified labor, as both companies’ current job openings are quite extensive (Heritage Networks, 2022; Ampersand, 2022). In the short run, these jobs are likely hard to fill, because if potential employees are highly skilled, why would they work and live in Alaska, when they could live in Southern California and likely receive a higher salary? Longer term, as suggested previously, certification programs at the University of Alaska or community colleges could attract otherwise under- or unemployed individuals desirous of continuing to reside in the state. Such vocational programs also could be made available online to attract out-of-state newcomers. Collectively then, there are many problems that prevent data centers from readily entering Alaska. A small electric grid raises the question whether the electricity necessary to power data centers can be provided. The widespread frequency of earthquakes raises construction costs and may even threaten the ability to function at all. Data protection rules raise the cost of storage. Most importantly, though, the state is relatively inexperienced in starting and maintaining large data centers. So, what beneficial lessons can Alaska learn and possibly adapt from arctic countries that are the current leaders in data computing? Arctic Competitors Several arctic countries have begun to capitalize on their geographic locations to take the lead in the emerging data computing market. The Scandinavian countries of Denmark, Sweden, Norway, and Finland have come out ahead due to having some of the most reliable energy grids in the world. With most of the energy in that region produced through renewable sources, corporations looking to increase their sustainability have chosen to place their developments there. The biggest incentive for data centers in the Scandinavia, however, is the price of electricity and the tax incentives offered by those governments. For example, the Swedish government introduced an incentive for the data centers, giving them a 97% remission on the electricity tax, which effectively reduces their overall bill by roughly 40% (Business Wire, 2021b). Norway has a tax relief system like Sweden’s to help data centers invest in the country (O’Dwyer, 2020). With the cheap price of electricity and these incentives, some of the largest tech companies in the world have begun to open shop due to the increased profitability. For example, Microsoft and Facebook have placed large investments into Sweden, while Google has done so in Norway (Upton, 2021). Across the Atlantic, Canada has been slowly growing a foothold in the industry. In Quebec, the largest utility company, HydroQuébec, produces nearly 100% of its power through hydroelectric or other renewable sources and has some of the lowest-cost electricity in North America, at 4.02 cents per kilowatt hour (Data Center Advantages…, 2021). Such low rates allow the city of Montreal to compete with the Scandinavian countries with
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