Can data centers ever be sustainable? A wake-up call for the industry

The demand for computing power has never been greater. Data center capacity is forecast to grow by around 16 percent annually between now and 2028, driven by cloud adoption, AI, and digital transformation. But as reliance on this critical infrastructure deepens, so too does its environmental footprint. The uncomfortable question we must now ask is: can data centers ever truly be sustainable while meeting the world’s surging appetite for data?

After three decades working in this industry, I see a risk that growth ambitions are overshadowing environmental responsibility. This is short-sighted. It accelerates climate risks and leaves operators exposed to an oncoming wave of regulation. The EU Energy Efficiency Directive and the UK’s Biodiversity Action Plan are early positive signs. While not designed for data centers specifically, both will fundamentally influence how they are planned, constructed, and operated.

The industry can wait for regulation to catch up, or it can act now, embedding sustainability into business models before it is mandated. At Ramboll, we believe the latter option is the only viable one. Our new white paper, ‘Developing sustainable data centers: A strategic roadmap to achieve net zero carbon and reduce environmental impact,’ identifies six benchmarks that must be tackled: operational carbon, embodied carbon, water, energy, biodiversity, and circularity. These represent both the industry’s greatest challenges and its greatest opportunities.

Operational and embodied carbon

Operational carbon usually accounts for the majority of a data center’s footprint. As long as facilities are grid-dependent, emissions will vary with the grid emission factor (GEF) of the country in which they operate. Locating in regions with a higher share of renewable energy immediately lowers carbon intensity.

But location alone is not enough. The International Energy Agency predicts data center electricity use could almost double by 2030, reaching 945 TWh. That energy produces vast amounts of heat, which has historically been wasted. Exporting surplus heat to local networks must become standard practice. This does not directly reduce the center’s emissions, but it displaces heating demand elsewhere, providing tangible value to surrounding communities.

Embodied carbon, locked into construction materials and processes, is less visible but equally important. Here, early design decisions and supply chain engagement are critical. Procuring low-carbon materials, for example, from recycled steel to low-carbon concrete, is achievable if collaboration starts early. Initiatives such as the Sustainable Steel Buyers Platform are showing what is possible.

Carbon offsets will still play a role, but only as a last resort and only under credible frameworks such as the Verified Carbon Standard.

Water management

Water scarcity is another looming challenge. The UK is projected to face a daily shortfall of several billion litres by the 2030s. Building water-intensive facilities in regions already under stress is neither sustainable nor socially acceptable. Developers should employ measures such as electrical cooling powered by renewables, rainwater harvesting, grey water use, and recycling systems.

Biodiversity and supply chains

Biodiversity net gain is now mandatory in the UK, requiring developers to leave natural habitats in better condition than before. This principle should extend beyond site boundaries to global supply chains. Data centers rely on resource-intensive materials, including rare earth elements. Sourcing them responsibly is essential if the industry wants to avoid shifting environmental harm from one geography to another.

Circularity and waste

The data center industry is still wedded to a “take–make–dispose” model. This dependence on finite resources is both environmentally damaging and economically risky. Moving towards circularity – recovering precious metals, recycling steel, reducing plastics, and reusing equipment – will lower emissions while also improving resilience against supply chain shocks.

A call to action

The rapid rise of AI is further accelerating demand for data centers. Without decisive change, the sector’s environmental impact will grow in lockstep. Sustainable design is no longer optional – it is a business imperative. Regulators, investors, and communities are already demanding it.

The good news is that solutions exist. Lifecycle financing, modular construction, early-stage planning, stronger regulation, and waste-heat reuse all provide practical pathways. The challenge is one of adoption and ambition.

The industry must act boldly, collaborate across supply chains, and embed sustainability into procurement and design standards. Failure to do so risks inviting stricter, less flexible regulation imposed in response to community anger and political pressure.

If the sector wants to remain both trusted and viable, it must take ownership of its sustainability journey. The time for small steps is over. What is needed now are bold commitments, shared knowledge, and collective responsibility.

If we don’t shape the future of sustainable data centers ourselves, it will be shaped for us. And by then, it may be too late.