Data centres: the risk runs into billions – design, insurance and resilience are crucial for capital
Aon: risk is ‘a strategic factor to be incorporated from the outset’ of a project. Today, ‘unprecedented’ investment is being made in the development of a single site
(Il Sole 24 Ore Radiocor) - Data centres have become one of the most strategic assets in the global digital economy, with investments on an unprecedented scale that in some cases exceed 20–25 billion for a single site. A scale that profoundly alters the relationship between infrastructure, capital and risk. Because when a facility concentrates investments of such magnitude and supports essential services for businesses and consumers, even a single incident can have significant financial and operational consequences. Yet many organisations continue to treat risk as a phase that comes after design and construction, rather than as a strategic variable to be integrated from the outset. This is an approach that can prove costly. This is highlighted in the report “Reliable by Design. The new approach to risk for those who develop and finance digital infrastructure”, produced by Aon.
The report explains that key decisions regarding the site, the layout of the facilities, energy supply and the technological configuration are taken in the early stages of the project. Once these have been finalised, changing them becomes complex and costly. Critical issues, however, may only come to light at a later stage: when funders question the restoration assumptions, when the insurance market does not offer sufficient cover, or when an incident during commissioning causes material damage and financial losses.
When risk comes into play too late
Most digital infrastructure projects are based on a linear approach: first you design, then you secure and build. But the growing complexity of data centres means this approach is becoming increasingly inadequate. Site selection, for example, is not merely a logistical decision, as it determines exposure to catastrophic risk and the level of risk concentration within the portfolio. Similarly, the energy strategy defines the duration of outages and recovery pathways, the layout of the campus, the computational density required due to artificial intelligence workloads, and the planning of construction phases. Every choice made at this stage – as Aon emphasises – establishes assumptions on which lenders and underwriters will rely for years to come. A single event – a fire, an electrical fault or a catastrophic event – can affect several buildings simultaneously if the campus has not been designed with a risk compartmentalisation strategy. On that scale, the difference between a contained incident and a material loss is measured in decisions taken months, sometimes years, beforehand. These decisions are made at the start of the design phase. When they are made without a proper assessment of the risk, the consequences follow later: reduced insurance cover, last-minute design changes, unstable renewals, and lenders raising doubts about recovery assumptions.
The transition from construction to operation: the most delicate stage
Among the stages in a data centre’s life cycle, the transition from construction to full operation deserves particular attention. This is a time when the systems are already up and running, but not necessarily stabilised. Redundancy may not yet be fully in place, some customers may already be connected, and operational responsibilities may be transferred from one working group to another, involving different contracts and governance structures. The issue also concerns insurance cover, as – as Aon explains – policies are not always structured to address the specificities of this phase, which risks being viewed as a mere administrative step between construction and day-to-day management. In reality, this is a distinct risk scenario, in which assumptions regarding cover, business continuity and recovery times must be verified. For developers and investors, managing this transition therefore means reducing one of the main areas of vulnerability for the entire project.
Bankability, insurability and resilience: the three factors that determine value
To assess the financial soundness of a digital infrastructure, it is not enough to consider the cost of construction or the potential return on investment. It is also necessary to assess its ability to withstand adverse events without compromising its financial and operational commitments.
