Icelandic data center developer Borealis Data Center has teamed up with Finnish public utility Loiste Lämpö Oy to deploy a waste heat reuse initiative at its data center campus in Kajaani, Finland.

The data center, located in the Ranta Business Park, has a target capacity of 10MW across two data halls, with the potential to scale to 100MW+.

The heat reuse system is expected to be operational by May 1, 2026, and will recover and repurpose heat from the data center’s HPC (high-performance computing) operations, transferring it to Loiste’s nearby heat pump facility. The facility will then convert the thermal energy into usable heat for homes and businesses in the Kajaani region.

“Data centers are critical infrastructure, and when done right, they can contribute directly to the communities around them in a positive manner,” said Björn Brynjúlfsson, CEO and cofounder of Borealis Data Center.

“This partnership shows how industrial byproducts like waste heat can be transformed into everyday value for local residents and businesses.”

The heat reuse system design and investment specifications were developed in collaboration with engineering and consulting firm Sweco.

“This supports Loiste’s strategic goal of reducing emissions so that the district heating we offer to our customers is as low-emission as possible,” says Marko Saviniemi, business director at Loiste.

“The waste heat from the data center utilized by heat pumps not only reduces emissions but also diversifies local heat production in a way that benefits everyone.”

The data center was acquired by Borealis last February from Finnish MSP Herman IT and sits on the site of a former paper mill. The same mill is also home to the Lumi supercomputer and a facility for XTX.

According to Borealis, the site is powered by hydro and wind energy, which the company claims makes it one of the “region’s most environmentally conscious computing facilities.”

Finland is one of the most mature markets for data center heat reuse due to its established district heating network and friendly regulatory environment. The Nordic country has seen several heat reuse projects announced in the last two years.

Earlier this year, atNorth signed a heat-reuse agreement with Kesko Corporation to utilize waste heat generated from its FIN02 data center in Sinimäki, Espoo, to a neighboring Kesko store.

Last October, Equinix partnered with Finnish energy company Helen to harness residual heat from its 1MW HE5 Viikinmäki data center in Helsinki to supply a nearby district heating network.