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3 Jan 2022

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How Does Canada Compare with the Nordics?

Canada and the Nordics (Denmark, Finland, Iceland, Norway, and Sweden) share similarities in population, land area, far-northern geography, and proximity to larger markets, as well as their economies and social structures.

It is thus insightful to compare and contrast them from the perspective of EESG challenges and the viewpoints of investors, developers, and operators of Digital Infrastructure. I have done so here with data from the IDCA's new EESG™ Digital Readiness of Nations Index.

* The first “E” of EESG - economy - finds that both Canada and the Nordics have highly developed economies.

* Within the “S” of EESG - social - they also have strong social services to their residents.

* The “G” - governance - in both Canada and the Nordics also rates highly. These three factors place these countries in the top tier of nations in being able to respond quickly and effectively to the challenges they face.

* Their primary challenges are within the second “E” – environmental – both are relatively large consumers of fossil fuels and consequently large producers of GHG emissions.

Canada has an overall EESG score of 67 (on a scale of 100), and the Nordics have a collective score of 77. With this score, Canada ranks 10th in the world among 147 nations studied.

Individually, Norway (with a score of 84), Iceland (81), and Denmark (78) rank first, second, and third in the rankings. Sweden (75) ranks sixth, and Finland (71) ranks ninth. The Nordics would rank 3rd as a single entity.

The world average score is 41.

There are the scores for Canada and each of the Nordics in the specific EESG categories:

Canada 77, ranks 19th in the world
Nordics 84, would rank 9th as a single entity
World average is 67


Canada 44, 33rd in the world
Nordics 54, would rank 23rd as a single entity
World average is 34

Canada 70, 29th in the world

Nordics 85, would rank 7th as a single entity

World average is 48

Canada 83, 11th in the world
Nordics 92, would rank 3rd as a single entity

World average 44

Renewable Leaders
Canada and the Nordics are both leaders in renewable energy - Canada through massive hydropower resources in Quebec, and the Nordics through aggressive use of all renewable resources (including the geothermal blessings of Iceland). Canada derives 65% of its electricity from renewable energy, and the Nordics average 77% across their expanse. This places Canada 32nd in the world in terms of percentage renewables, where Nordic would rank 23rd as a single entity.

On an economic basis, the Nordics are the most efficient fossil-fuel users in the world, emitting GHG at a rate less than half of the US and less than a third of Canada. Canada, on the other hand, runs squarely in the middle of the pack with its GHG economic efficiency, similar to Brazil.

Canada and the Nordics both have highly developed Digital Infrastructure. Internet access reaches more than 90% of the population in each country, and all have relatively fast Internet bandwidth (although the Nordics consistently runs about 30% faster). Mobile subscriptions in Canada approach 90% of the population, while the Nordics each have more than one mobile subscription for each member of their populations.

Strong Server Density
In the critical area of server density, Canada is at a par with most the Nordics, at around 40,000 servers per 1 million population. Denmark is the exceptional performer in this category, now approaching 300,000 servers per million population.

Denmark is by far the world leader in server density per population, approximately doubling the US and Netherlands, which compete for second place in this category. Canada’s density puts in the world’s Top 20, with the rest of the Nordics in that general area.

Canada can thus be thought of as a nation comparable to the collective Nordics when it comes to existing Digital Infrastructure and its future. I will write about the Nordics' potential future soon. For the moment, we can focus on Canada, which can leverage its location to the US and the world's largest economy.

The US is the world leader in total number of servers given its population of 330 million people and high density, with 30 times more servers than Denmark. Even so, both Denmark and Canada are in the world’s Top 10 in this category.

Canada's Potential
Developing data centers requires electrical power. Canada excels in this area. Quebec’s and Ontario's enormous hydroelectric resources make them obvious areas for continued data center development. Quebec and Ontario produce about one-third and one-quarter of Canada’s total electricity, respectively. Hydro accounts for 94% of Quebec’s electricity consumption, and it exports about 3,000 steady state megawatts to New England and New York in the US. Ontario has ample nuclear power and other renewable sources in addition to its hydro power. Ontario receives 59% of its electricity from nuclear plants, 24% from hydro, 8% from wind, and 1% from solar.

Thus, the US server density is more than 3X times that of Canada, even though the two countries are equally urbanized, with slightly more than 80% of their populations living in cities and metro areas. This appears to offer a great growth opportunity for investors in Canada and for the country as a whole.

Canada's potential will be discussed in depth in June of this year at an IDCA Symosium in the Toronto area. The physical infrastructure described here will be under discussion along with federal and provincial governmental policies and their potential to enable Canada to continue to grow as a world leader in Digital Infrastructure.

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