Data centres brace for new EU energy reporting obligations

The European Commission is ramping up industry reporting obligations in order to ensure the EU meets its stated goal of making data centres climate neutral by 2030.

Under the revamped Energy Efficiency Directive, in force since 10 October, owners and operators of data centres with a minimum installed IT capacity of 500 kW must disclose their energy performance: 2023 data must be reported by 15 May 2024.

Data centres accounted for 2.7% of electricity usage in 2018 across the EU and could reach 3.21% by 2030 under current trends if nothing is done to curb consumption, the Commission said.

The EU executive is now preparing to set out reporting metrics by December 2023, following a public consultation, said Nikolaos Kontinakis, an official working at the energy efficiency unit at the European Commission’s energy directorate.

Data centres are a “very mature and very active industry” about which little is known, Kontinakis said at an event on 27 September hosted in Zaragoza by the Cloud Infrastructure Services Providers in Europe (CISPE) and European Data Centre Association (EUDCA).

The Commission’s action plan on digitalising the energy system, adopted last year, presupposes a twin digital and decarbonisation transition, with cloud computing helping renewable energy providers scale up operations.

But the environmental impact of digital solutions needs to be addressed: Reaching data centre climate neutrality by 2030 requires industry to accelerate efforts to reduce its energy consumption and increase reliance on sustainable energy.

And overall progress in the industry has been sluggish in recent years. The 2023 survey by the Uptime Institute found that the average global power usage effectiveness (PUE) of data centres has remained flat in the past four years.

“Government regulations aimed at improving data centre sustainability and visibility are beginning to require attention, investment, and action,” said Andy Lawrence, executive director at Uptime Intelligence, adding that additional improvements in PUE levels will require significant investment.

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EU standards by 2025

EU regulations will set sustainability performance standards for data centres by 2025, a measure welcomed by countries with large data centre footprints such as Ireland and Germany.

Francisco Mingorance, secretary general of CISPE, stressed that the cloud computing and data centre industry aims to be the first climate neutral sector in Europe by 2030, and praised efforts to embed best practices ahead of schedule.

The industry’s Climate Neutral Data Centre Pact targets a Power Usage Effectiveness (PUE) of 1.4. According to research by S&P Global, newer data centres currently operate at 1.5 and cloud data centres at 1.4 or less, while older enterprise data centres run at a PUE of 2 or more.

The new German Energy Efficiency Act mandates a PUE of 1.2 for new data centres by 2026, reflecting a forward-looking approach as new installations will remain in place for decades ahead.

As one of the largest operators in Europe, Amazon Web Services (AWS) will be directly impacted by the new regulations. But AWS believes its scale will allow the company to achieve high energy efficiency.

AWS used the event in Zaragoza to showcase its installations in the region of Aragón. There, the company collaborates with Repsol Renewables to source green energy for its data centres from local wind farm installations through power purchase agreements, and aims to be water positive by 2030.

S&P research estimates AWS’ infrastructure is up to five times more energy efficient than the median of surveyed European enterprise data centres.

In Zaragoza, speakers expressed their disappointment at the Commission’s decision not to gather data on installations with a capacity of 100 kW or above. Smaller data centres of around 100 kW could save 5 terawatt hours of electricity per year if they manage to reduce their PUE to 1.4 – enough to power a large European city like Hamburg.

Pauline Fournols of industry group WindEurope praised the digital industry for being among the first to invest in wind power through PPAs. However, it still takes an average of five years to secure permits for on-land wind farms, she added, flagging permitting issues as a remaining bottleneck.

European Commission President Ursula von der Leyen announced the launch of a European Wind Power Package to unblock permitting barriers in her latest State of the Union address last month.

Under the recast Energy Efficiency Directive, local authorities are also required to prepare heating and cooling plans to reuse excess heat generated by data centres.

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[Edited by Frédéric Simon/Zoran Radosavljevic]

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