One of Europe’s largest manufacturers of ammunition is facing a roadblock to the planned expansion of its largest factory because a new data centre for TikTok is using up all the spare electricity in the area.
Nammo, which is co-owned by the Norwegian government and a Finnish state-controlled defence company, has been told there is no surplus energy for its Raufoss plant in central Norway as a data centre that counts the social media platform as its main customer is using up the electricity in the region.
“We are concerned because we see our future growth is challenged by the storage of cat videos,” Morten Brandtzæg, Nammo chief executive, told the Financial Times.
Demand for ammunition has surged thanks to the war in Ukraine, which is using about 6,000 rounds per day — equivalent to the annual orders from a small European country — and would like to fire 65,000 if it could, according to Nammo.
Brandtzæg said demand for artillery rounds was more than 15 times higher than normal. The European ammunition industry needs to invest €2bn in new factories just to keep up with the demand from Ukraine, let alone other European countries, according to the Nammo chief executive. “We see an extraordinary demand for our products which we have never seen before in our history,” he said.
TikTok is building three data centres this year with the option of adding two more by 2025 in Hamar, 25km to the east of Raufoss, Norwegian data centre provider Green Mountain said this month.
Asked whether it was coincidence that a Chinese-owned company was stopping a defence company’s expansion, Brandtzæg replied: “I will not rule out that it’s not by pure coincidence that this activity is close to a defence company. I can’t rule it out.”
TikTok declined to comment. Elvia, the local energy company, confirmed that the electricity network had no spare capacity after promising it to the data centre as it allocates it on a first come, first served basis.
“If Nammo orders capacity, depending on how much it needs, it will take time before there is available capacity as the transmission network needs to be strengthened,” Elvia said.
Experts say fights over which companies and which type of industry get priority access to electricity grids is likely to increase across Europe. Data centres have flourished in the Nordic countries because of once-plentiful and cheap electricity, as well as a colder climate that keeps cooling costs down.
But the clean energy transition is also prompting companies in the battery sector and steel industry to flock to the Nordics, causing competition over access to electricity.
“It will be a big fight,” said one industrialist in northern Sweden where such a conflict is brewing. “Do we want green steel or data centres for Facebook?”
Brandtzæg said governments needed to set priorities over which industries could receive special access to energy. “For Europe, this is a major concern for industry: critical industry must have access to energy,” he warned. “I don’t think it’s one-off, I think it’s a trend for the future.”
Per-Gunnar Sveen, head of the committee for business development at the county council of Innlandet where Nammo is based, said: “In this special matter, we will work to secure the supply Nammo needs to go forward with their plans and be able to expand its factory. It is in the national interest to secure their possibility for development.”