Awareness of the environmental impact of data centres is increasing as AI and other high-density workloads drive unprecedented power demand. The International Energy Agency reports that global data centre electricity consumption could more than double to 945TWh by 2030 – exceeding Japan’s total consumption today. Rising energy consumption also brings rising costs and the sheer scale required to run increasingly popular AI workloads now demands executive-level attention.

As AI adoption accelerates, the need for sustainable, high-performance digital infrastructure is surging and unsurprisingly the data centre industry is scaling at record speed to meet this substantial demand. While it might seem like data centres are popping up everywhere, the industry is fraught with challenges that have huge implications for energy and network infrastructure, land development, sustainability legislation and the communities in which they are located.

Data-intensive businesses are increasingly requiring sustainable digital infrastructure to enable the decarbonisation of their IT workloads and, similarly, municipalities and communities alike are now requiring tangible evidence of sustainability and local benefits at the site selection stage.

As AI adoption accelerates, the need for sustainable, high-performance digital infrastructure is surging and unsurprisingly the data centre industry is scaling at record speed to meet this substantial demand.

Location
The most critical factor in data centre development is access to power. Many countries simply don’t have enough power available or the necessary infrastructure to support it. In the UK, for example, much of the national grid was built between 1950–1970 and supplied by large coal-fired plants as a result of post-war regeneration, and is in desperate need of upgrading.

The Nordic region, in comparison, has robust energy infrastructure and an abundance of renewable energy, making it an ideal location for data centre development. The Nordic countries also have a cool climate, enabling highly energy-efficient cooling technologies such as natural air or direct liquid cooling (DLC) that not only reduce the carbon footprint of the data centre but also reduce operational costs.

At the same time, data centres can play a much more active role in supporting national grid infrastructure by adjusting their energy consumption to help stabilise frequency – for example, through fast frequency reserve (FFR) solutions – and by storing excess energy in backup battery systems when the grid has an oversupply. That stored energy can then be fed back into the grid during periods of high demand. This will be pivotal to maintaining long-term power availability as digitalisation increases.

Heat reuse
The process of recycling waste heat from data centres is an essential initiative that not only lowers the carbon footprint of the data centre but also the receiving organisation.

AtNorth considers heat reuse agreements at the planning phase to ensure suitability of partners and community impact. Certainly, sourcing a recipient for waste heat in Iceland, a country known for its geothermal activity, can be a challenge. However, AtNorth has collaborated with a number of organisations across the Nordics, including heating a new community greenhouse in Akureyri, Iceland, to enable local school children to learn about ecological cultivation and sustainable food production; an agreement with supermarket chain Kesko in Finland to heat a neighbouring branch of one of its stores; and a partnership with waste-to-energy company Vestforbrænding in Denmark and Stockholm Exergi in Sweden to provide heat for the local district heating networks.

The data centre ecosystem
The sustainability of data centres is no longer a tick-box exercise and is increasingly affecting the ability of operators to scale in line with increasing demand for high-performance digital infrastructure. Operators must go beyond proving their environmental sustainability and take a more holistic approach to the ways in which their presence benefits the local area and the people living there in order to successfully procure land for data centre development.

AtNorth’s data centre ecosystem blueprint embodies responsible operations across the board, encompassing beneficial geographic locations, using renewable energy, thoughtful site design, environmental stewardship, regenerative practices, heat reuse, community integration and a positive impact on local economies from the outset.

In 2026 and beyond, data centre operators that can deliver sustainable, trusted, AI-ready capacity at speed will sit at the heart of thriving communities and lead the next era of digitalisation. Those who fail to prioritise responsibility may struggle to build at all.

The views and opinions expressed in this article are strictly those of the author only and are not necessarily given or endorsed by or on behalf of the Energy Institute.

• Further reading: ‘From energy sink to energy source: why data centres must bring their own flexibility’. As AI drives a surge in electricity demand, grid operators are increasingly asking data centre developers to provide their own flexibility. Speakers at the recent Innovation Zero event argued that batteries, virtual power plants and new operating models could transform data centres from passive consumers into active participants in the electricity system.
• ‘Heat for less in UK social housing trial’. The heat generated from cooling data servers, among other low-carbon technologies, is being used to warm the homes of social housing tenants in a government-funded trial project in south-east England. The project is providing access to cutting-edge technology that would normally cost thousands to eligible tenants at no cost.