Data Centres: Heroes or Villains?

The power demands of AI and looming climate targets have put the data centre infrastructure industry at a reputational crossroads. I believe we can work harder and smarter in several areas to do the right thing.

When people say “data is the new oil”, it scares me, considering the road the oil industry took. The digital economy and the data centres that enable it are driving global change, but in the area of power solutions provision there is much more we can do to ensure that change is for the better, environmentally and socially as well as economically. Power is the industry’s number one challenge today. Considering the huge amount of power data centres use, plus the talent, money, and technology available to the industry, they should be powerful problem solvers for global sustainability - heroes, not villains.

Mind the Gaps

Everyone understands that data centres are vital to societal growth. They are critical infrastructure, enabling everything from finance to entertainment, mobility to medicine, and they are fundamental to the digital economy, which is forecast to account for 17% of global GDP by 2028 (Forrester, July 2024). The speed of this digital transition is phenomenal, and it is set to accelerate as AI-driven apps roll out worldwide.

However, there is another transition underway that is not moving so fast: The transition from fossil-based to zero-carbon electricity is the key to reducing energy-related CO2 emissions to mitigate climate change. However, as power demand rises (the current global rate is 4% a year), it is becoming harder for utility providers to overhaul and decarbonise their power grids fast enough. 

For the fast-growing data centre market, this gap between digital demand and grid capacity is already impacting mature hubs.  Amsterdam, Frankfurt, Northern Virginia, Singapore and Dublin have all felt the crunch. 20% of power in Ireland now goes to data centres, and they now account for over 10% of power usage in four US states (IEA). To be fair, these figures do not reflect the broader picture of data centre power consumption (1-1.5% worldwide versus 1% of emissions), but they do accurately reflect the need for the industry to concentrate on urban digital hubs, and they make for attention-grabbing headlines which can turn public perception against the industry. 

There is another gap that our industry is struggling with: the gap between today’s available fuel solutions and tomorrow's zero-carbon solutions. It is fair to say that the industry’s investment in renewables so far has been nothing short of heroic, funding more new solar and wind projects than any other industry. However, renewables alone are too erratic to provide consistent low-carbon primary and backup power, and new sources like hydrogen, nuclear, and biofuels are not yet available at a sufficient scale. 

Build Bridges

The choice between hero and villain is not a clear-cut one between good and bad. Doing nothing or being complacent in the face of these challenges will damage the industry. Instead, we should make our best effort with the solutions we have now.  

Here are three things we can do today.

1. Give Back to the Grid

We need more flexible assets on the grid to fill the gaps. For example, the last coal-fired power plant in the UK shut down this year, but coal and oil-fired generation is still widespread in continental Europe. Five years ago in the UK, gas generation was perceived as the answer for areas requiring peak shaving (when you briefly reduce power consumption to iron out spikes by either scaling it down or sourcing additional electricity from local power sources). The flexibility this gave to the UK grid has helped greatly in removing coal from the energy stack. A small number of grid-balancing gas engines in a system can provide the balancing and flexibility needed for renewables to flourish. 

In the same way, we can use gas generation and/or HVO (Hydrotreated Vegetable Oil) standby to run 100 MW microgrids for data centres that can deploy dispatchable power that can be given back to grids via smart control systems. This is already happening. AVK currently has over 200 MW of microgrids in build, and over 1 GW at design stage. But the era of the 1 GW data centre campus is beginning, and many more similar projects will be required. 

2. Make Future-focused Choices

R&D takes time, but that does not mean we should just wait for the answer to arrive. We can give R&D time to come up with new renewable fuels while using bridging solutions that can be adapted for the future. These are available now, and we can also learn from other industries with similar challenges, like aviation and shipping. For instance, it is perfectly practical to install equipment that is designed to run on renewable fuels like HVO or SAF (Sustainable Aviation Fuel), biogas, and hydrogen.

Where solutions do not currently exist, we need to develop them. At AVK we now build our own control panels as the point at which the data center meets the grid is so critical. Working with the emissions authority, we are also building our own SCRs (Selective Catalytic Reduction filters). And we recently launched the AVK Academy, where we have designed our own curriculum to enable the sustainable future development of the industry.

3. Collaborate & Integrate

Pre-build consultation and planning needs to be more extensive and inclusive so that the best solutions for the facility, the community, and the grid can be identified and pursued. When AVK first started providing power solutions to the data centre industry, we were not included in the planning stage. This has now changed, but we still need more open, shared collaboration between the client, power solutions providers, fuel providers, local planners, and utilities.  Between us, we should capture the low-carbon solutions that work best for our industry and share them widely.

Community integration is also key to improving public perceptions of the industry. By collaborating at the design stage, we can improve the likelihood of contributing waste heat to power local swimming pools or businesses, spot local talent or invest in initiatives that benefit local residents. 

Choosing the Right Path

Sustainability is a journey, not an answer, and some sections of the journey are bumpier than others. But that does not mean we can’t improve our environmental impact, step by step. So much of what the data centre industry brings to society is positive that it would be a great shame for the industry to lose public support. Making the right power design decisions now will help safeguard the industry’s future while the digital and energy transitions align.