A.I.’s Power Problem: How Data Centers Hold the Key to a Greener Future

The A.I. market has seen unprecedented growth in recent years and shows no signs of slowing down. According to a UN Trade and Development (UNCTAD) report, the global A.I. market is projected to surge from $189 billion in 2023 to $4.8 trillion by 2033—a 25-fold increase in just a decade. This growth is unsurprising given the wide-ranging benefits A.I. can bring to businesses across all sectors. From operational efficiency to data-driven analysis to personalization of products and services, A.I. has become a critical factor in company competitiveness and long-term viability.

Yet, more recently, awareness has grown around A.I.’s environmental impact. Every digital activity, from internet banking to media streaming, triggers processes in a data center. The rise of A.I. and other high-performance computing, such as computer-aided design simulations or financial trading analytics, has fueled an enormous demand for high-density, ’A.I.-ready’ data centers that can accommodate more powerful CPUs and GPUs and more complex storage architectures. Projects such as the E.U.’s €200 billion InvestAI initiative and the U.S.’s $500 billion Stargate project evidence the incredible global investment in digital infrastructure.

Such data centers require access to vast power supplies, ultrahigh-speed networks and sophisticated cooling systems. Due to limited space, power and network capacity, these needs can be difficult to accommodate within legacy data center sites, which has no doubt fueled the thriving data center development industry that we see today. 

The future of A.I. is powerful

Data centers have always had significant energy requirements to power and cool their equipment, but as IT workloads become more data-intensive, it follows that energy demands also increase. Where a traditional enterprise data center might have had a power requirement of five to 10 megawatts (MW), today’s facilities often require 200 MW or more. Google’s new data center in Norway, for example, has been allocated 240 MW, enough to power about 240,000 homes. A recently announced five-gigawatt (GW) data center in Abu Dhabi underscores the growing global demand for digitalization, and the colossal energy consumption that comes with it. The environmental and financial stakes are profound.

At the same time, the introduction of ESG legislation such as the E.U.’s Corporate Sustainability Reporting Directive (CSRD), which mandates carbon footprint disclosures for many businesses, is bringing company sustainability into the boardroom. These carbon figures, published similarly to annual corporate reports, could become a competitive differentiator for data-intensive businesses as awareness around A.I.’s energy consumption grows. Company leaders face a daunting challenge: meeting their growing computational demands while managing their long-term ecological footprint.

An unexpected solution lies within the data center industry. Traditionally, a ‘back end’, low-priority consideration, data centers are now at the forefront of a sustainable A.I. industry. 

Why it matters where your data is

Realizing the enormous energy requirements needed for A.I. data centers has brought power availability to the forefront of the planning phase, with operators seeking land with access to clean, natural and renewable energy sources.

The Nordic region, in particular, has attracted significant investment due to its abundance of renewable energy. By 2018, all Nordic nations had achieved their 2020 goals set by the E.U. Renewable Energy Directive, two years ahead of schedule. Norway operates nearly 1,700 hydropower plants that supply roughly 89 percent of its electricity, with wind and solar power providing another 9 percent. Similarly, Iceland draws from a combination of geothermal and hydropower, achieving 100 percent renewable electricity generation. The region’s naturally cool climate further reduces the amount of energy needed for the infrastructure cooling process. Meta, for example, operates two data centers in the Nordics, not to mention atNorth’s eight data centers across the region that run on renewable energy sources.

Globally, the push for cleaner data infrastructure is intensifying. Amazon has expanded its nuclear energy partnership with Talen Energy, and Google has a campus powered by hydroelectric energy in Nevada. Further afield, Microsoft has announced plans for a geothermal-powered data center in Kenya. In emerging economies, operators such as CtrlS in India are investing heavily in solar, wind and hydropower resources.

Utilizing low-carbon power sources and energy-efficient cooling techniques significantly lowers running costs and enables the decarbonization of IT workloads, helping clients realize their ESG targets and lower their total cost of ownership (TCO). For example, Shearwater Geoservices reduced its CO2 output by 92 percent and costs by 85 percent after relocating a portion of its digital infrastructure equipment to an atNorth data center in Iceland.

Amid rising geopolitical uncertainty, the location of IT workloads has become increasingly important for security and data sovereignty. Nordic countries are well-positioned to meet these requirements, operating under the E.U.’s stringent General Data Protection Regulation.

Contributing to a circular economy

Beyond the ‘power problem,’ heat reuse is the next frontier in sustainable data center design. Waste heat from computing can serve a broader purpose: lower the carbon footprint of a data center to support local communities. In Japan, waste warm water from a White Data Center campus is used for local fish farming. During the 2024 Olympics in Paris, a nearby data center campus heated the Olympic Aquatic Center. In Finland, atNorth partnered with Kesko Corporation to utilize waste heat from its new FIN02 campus into Kesko’s building systems, helping the company reduce Scope 1 and Scope 2 emissions by 50 percent. 

Even in Iceland, a country with abundant warm water from natural geothermal energy sources, atNorth is using waste heat from its ICE03 site to support community projects in Akureyri. These include a community-operated greenhouse that helps local schoolchildren learn about ecological cultivation and sustainable food production. 

The Nordic region’s commitment to circular economy principles is well established. Governments in the area actively facilitate initiatives supporting waste heat recycling and renewable energy procurement through mechanisms like Power Purchase Agreements (PPAs), which provide long-term price stability and help fund clean energy projects.

Designing sustainable data center ecosystems

Given the pace at which digital infrastructure must scale, the environmental risks are undeniable. Yet, the industry has an opportunity to lead by example. It is essential for the sustainability of the industry and our planet that this becomes a pivotal part of the planning and development of A.I.-ready data centers.

Sustainable data center design should embrace evolving innovation in hardware, including chip design, processors, cooling technologies and heat reuse technologies. Adopting simple, prefabricated design allows for future innovations in hardware, enabling modular construction to meet demand and scale rapidly. 

The sustainability of data centers must extend beyond the mitigation of carbon use to promote responsible operations across the board—that is, to develop data center ‘ecosystems’ that contribute to environmental restoration and community care and support resilient, self-sustaining local economies. This includes investments in regional infrastructure, like the central access point created alongside atNorth’s ICE03 data center in Akureyri, which improves connectivity for homes and businesses by allowing users to connect to a larger network. 

Additionally, grid balancing services can be integrated directly into data center design, a key feature of atNorth’s reference blueprint for future sites. This allows power consumption or generation to be adjusted in response to fluctuations in grid frequency. When the grid has surplus energy, excess power can be stored in the data center’s backup battery systems and fed back during periods of high demand, actively supporting the local power infrastructure to benefit the broader community.

Ecosystem thinking for sustainable growth

Data center ecosystems could lie at the very heart of a community, creating jobs in construction, operations and downstream industries linked to heat reuse like agriculture. The presence of data centers and their employees can spark new investment in leisure, education, community services and entertainment amenities that further contribute to local economies. 

From an ethical standpoint, responsible operations should promote biodiversity initiatives to encourage a thriving natural environment. atNorth’s DEN02 campus in Denmark sits on a 174-hectare greenfield site, with large portions dedicated to rewilding. Insect monitors track biodiversity over time to evaluate environmental impact throughout the site’s development, construction and operation.

As both A.I. adoption and climate challenges accelerate, it’s essential to recognize their profound link. For data-intensive businesses looking to reduce their carbon footprints, choosing responsible data center partners can help deliver on ESG targets while contributing to both global impact and meaningful local value—to future-proof themselves, digital industries and our planet.