The data center industry has been extra active lately. It has seen a massive surge in demand for resources, allocations, energy and anything else you can think of. Total demand for data center usage has soared in all regions and there’s no end in sight.
While this is great news for data center operators, as it means a long time ahead with certain growth, it also poses some challenges. Among them is the constant increase in the consumption of resources – energy and water, which are critical for the operation of each data center. Solving these challenges will require “a lot of everything” type of approach – optimizing and lowering the energy and water consumption, improving the supply of the same resources, lowering the costs, etc.
Data centers are hungry. Very hungry.
The latest statistics from the industry paint a very telling picture. For example, Apple recently published its Environmental Progress Report and it said that its data center and colocation facilities around the world consumed 2.344bn kWh of electricity. Surprisingly Apple operates only seven of its own data centers. All its other needs are colocation deployments, but the company keeps its numbers and locations undisclosed. It does say in the report that all of them, along with their own data centers, are using 100% renewable PPAs, DataCenterDynamics reports.
Apple says that its largest data center is in Mesa, Arizona, which consumed a staggering 488 million kWh, and 82% of that power came from solar, including 4.67MW from onsite solar panels at the local car park. The other 18% came from wind power.
The facility in Maiden, North Carolina, used 453 million kWh. Again, 82% came from solar, but 12% – from wind. Two of Apple’s data centers also used micro-hydro energy, albeit at a small share. It also has two data centers in China, but local regulations made it so that Apple is not running them, but local companies. They use 50% wind and 50% solar energy.
It’s a similar picture for colocation. Most of the colocated facilities for Apple are in the US and they used 387 million kWh energy in 2023. The international consumed energy is 96 million kWh. In fact, Apple’s colocation energy usage fell for the first time in history as the company relies more on its data centers.
Data centers are very thirsty, too
A new report by China Water Risk (CWR) notes that China’s data centers already use a lot of water, and the consumption will double by 2030. The main driver of this rise is the demand for AI services.
CWR estimates that currently data centers in China consume around 1.3 billion cubic meters of water annually. That could go beyond 3 billion m3 by 2030 at the current rate of increase and projections.
“For the ICT sector, the time to tackle water risks is now – we must get on top of these before the explosion of AI. China’s ICT giants must take the lead to be ‘water neutral’ or ‘water positive’ like their Silicon Valley counterparts of Meta and Google,” said report author Debra Tan to DataCenterDynamics.
“Despite rising water use, water supply may fall due to the mismanagement of the increased volatility from extreme weather events as well as a rise in chronic risks such as water scarcity and sea level rise. While some leading ICT companies have started to map their transition plans, many have yet to formulate comprehensive water risk mitigation and stewardship strategies,” says CWR in the report.
That will be a problem as only 32% of China’s data center racks are in water-rich regions. 46% are in the “Dry 10” areas which are as dry as the Middle East. In total 41% of racks are in regions prone to droughts. Another 28% have the opposite problem and are in regions prone to floods.
“Even those that are aware are likely to be caught off-guard by the fast-evolving water risk landscape due accelerated warming as previous steps to ensure climate resilience may now not be good enough,” the report adds.
Data centers are fueling old energy tech
Data centers are traditionally associated with the latest and greatest technologies. Those technologies are indeed there, but they are even more hungry for resources. And a lot of local grids aren’t able to provide it.
A clear example of this is Northern Virginia in the US. Not many people know it, but that region is the “World’s Internet hub”. The data centers there process almost 70% of the global Internet traffic, says DataCenterKnowledge. And that’s a big problem as their electricity demands keep rising and the state views it as unsustainable. It’s impossible to build enough green energy sources fast enough and to cover all the needs of the data centers.
This means that those modern facilities will have to continue to rely on the old coal power plants in the region. And in fact, the state will have to build several hundred miles of transmission lines and use the power and help of three neighboring states which will also provide power via coal plants.
Unsurprisingly this causes some pushback in the region. “It’s not right,” said Mary Gee, whose property already abuts two power lines that serve as conduits for electricity flowing toward the biggest concentration of data centers – in Loudoun County, home to what’s known as Data Center Alley. “These power lines? They’re not for me and my family. I didn’t vote on this. And the data centers? That’s not in West Virginia. That’s a whole different state.”
Some organizations are also against the continued use of coal power plants. They see this as a health risk for the locals. And it will bring in higher bills as the energy from those plants is more expensive. Another reason for higher bills will be the need to pay for all those additional power lines and infrastructure being built. Those costs will be split between all users in the region, not just data centers.
The consumption of energy will keep increasing
The 2024 Report to Congress on U.S. Data Center Energy Use was recently published and was produced by Lawrence Berkeley National Laboratory (LBNL), part of the Department of Energy, DataCenterFrontier notes. It says that over the past three years data center energy use in the US doubled, and it will grow by another 50% by 2027. The key driver is, yes, AI.
Current data center electricity use is 375 TWh in the US alone. It was 175TWh in 2021. By 2027 it will go beyond 500 TWh. The report also cautions that the AI adoption is so rapid, it makes projections difficult, so when 2027 actually comes, the results might be different and higher.
“We used to say ‘bring the power to the data centers. Now we say, ‘bring the data center to the power,” says Ed Socia, Insight Director for North America at datacenterHawk, a research firm that tracks data center activity. The energy demands are becoming a key factor for companies to decide where to build their new data centers.
Despite that, the reports expect that the overall national grid will manage with the difficulties. “There could be challenges meeting demand in certain locations, within a certain period of time. But we think that there will be other locations where that power could be addressed or met,” says Arman Shehabi, staff scientist at LBNL.
The key is getting the power to the data centers. It will require not only building new facilities closer to the power sources, but also adding more infrastructure to transport the electricity to the already built data centers. Those investments will drive further businesses along with the growth of data centers.
“What will be the big technology shift in the 20s? We’re not sure yet. But there’s a lot of opportunity here for how that demand can be met. A lot of opportunities of working with the utilities have been discussed and are being worked on now,” said Shehabi.
Big innovations are coming
As we can see, just regular energy sources aren’t enough. So, some big names in the world of IT are already working on alternative projects. OpenAI’s Sam Altman and venture capital firm Andreessen Horowitz (a16z) for example are investing in a new energy company called Exowatt. The main goal of the company is to create modular energy systems for data centers using thermal energy. Their first product is called P3. It uses a heat collector, a battery, and an engine. It can fit into the space of a standard shipping container. It then takes the heat from the sun or other sources, stores it and it can transfer it into energy up to 24 hours later.
The company says the energy P3 produces can be at a cost of as low as $0.01 per kWh. “Unlike traditional solutions that require significant upfront costs and extended setup times, Exowatt’s modular system can be deployed rapidly and cost-effectively – and it’s available this year,” said Exowatt CEO and co-founder, Hannan Parvizian. “Exowatt is built to respond quickly to the escalating energy demands of the modern world, especially those spurred by the rapid growth of AI.”
Other big names aren’t waiting around either. Intel and ExxonMobile are working together to develop new liquid cooling technologies for data centers. The companies say that the use of fluids will reduce the total cost of ownership of IT equipment by 40% compared to air-cooling. And it will improve the power usage effectiveness. It will also lower the consumption of water.
Google is working on improving its data center energy usage, too. The company recently announced it will invest €600 million in its fourth data center in the Netherlands. “Organizations and governments in the Netherlands are increasingly moving to the cloud. Cloud computing usage has almost doubled in the Netherlands in the last five years. The rise in demand is why Google is investing in digital infrastructure, which helps expand everybody’s access to information,” a press release stated.
“We invest in local projects for green energy, which means we can bring green energy to the local power grid,” the company added. It says it will rely on wind energy from the North Sea for its data centers in the region.