Data centers are becoming an increasingly large problem, as they are expected to consume as much electricity as the EU by 2030. This alarming forecast from ABI Research underscores the urgency of addressing the environmental impact of data centers. The study predicts that by the end of the decade, there will be over 24,000 data centers worldwide, growing at an average annual rate of 12%.
The projected electricity consumption of these data centers is 2,477 terawatt hours (TWh) per year, according to the International Energy Agency (IEA), a significant increase from the 460 TWh recorded in 2022. For comparison, the total electricity consumption of the EU, with its enormous population and economic output, was about 2,568 TWh in 2023. Such a comparison underlines the magnitude of the energy that a relatively small number of data centers will require.
Rithika Thomas, senior analyst for sustainable technologies at ABI Research, explains the challenge: “The processing power of power-hungry GPUs and cooling are the most energy-intensive processes in the data center, accounting for 80 percent of energy demand.” The rise of AI applications and models, which account for 10 to 20 percent of data center power consumption, is exacerbating this problem as the adoption of AI continues to grow.
To mitigate the impact, it is essential to integrate new retrofit technologies into existing data centers and adopt responsible computing practices. Thomas emphasizes the role of governments in promoting greener initiatives: “By setting green building standards, incentivizing the use of renewable energy sources, regulating the use of coolants, and supporting efficient e-waste disposal practices, governments are driving the concept of sustainable data centers.”
While these measures are necessary, the hyperscale cloud market is enjoying significant growth. Synergy Research Group reports a 22% year-over-year increase in global spending on cloud infrastructure services in the second quarter, to $79 billion, with Amazon Web Services (AWS), Microsoft and Google leading the way. The boom in generative AI is a key factor in this market acceleration.
Despite economic and political challenges, market strength continues to drive investment in cloud services. However, as data center energy consumption raises sustainability issues, the industry must balance growth and environmental responsibility to ensure a sustainable future.
