After the surge in energy costs last year and the widescale crisis, figures are starting to return to normal and the conversation is changing. We’re no longer talking about an energy crisis, as such – we are discussing an evolution of the energy landscape.
As we adjust to a new energy normal, the success of REPowerEU and Fitfor55 strategies has positioned Europe as a leader in the energy revolution. Surpassing ambitions, Europeans are no longer dependent on Russian fossil fuels and the influence of natural gas and renewable energy continues to grow. However, this does not mean that our energy security worries are over.
A ‘lucky’ warm autumn and the requirement for lower heating have allowed utility providers to bolster their gas storage supplies – but this does not mean that energy or decarbonisation should slip down political and business agendas. Climate change may have kept us warm in Europe last year, but it can also have disastrous consequences for the energy market itself.
The urgency of the energy crisis may now be over, but energy security remains an issue. The key tool we have to fight this challenge is digitalisation. From the grid to electric vehicles to smart home technology, the digital energy revolution is connected by data centres. But what is the role of the sector in combatting climate change, and what else can be done to ensure energy security?
The climate challenge is an energy challenge
Despite lower fuel prices and some relief from the growing presence of renewables, extreme weather events continue to pose risks to energy markets. Heat waves and cold snaps increase pressure on the grid, causing periods of supply uncertainty and price volatility and as an energy-intensive industry, data centres can be hit hard by this kind of disruption. As for sustainability, the European Climate Neutrality Observatory estimates that the EU should increase annual investment by €360bn to achieve 2030 and 2050 climate targets, further proving that a sense of urgency is vital.
Although greenhouse gas (GHG) emissions from electricity have decreased at a sufficient rate to hit EU targets, the development and uptake of renewable electricity generation and its integration into the power system are developing too slowly, knocking the sector off-track to reach net zero by 2050.
Europe is moving in the right direction and we have the tools we need - but we must accelerate action. The question is, do we have the collective will to push this forward? It is up to policymakers and industry leaders to facilitate the transition and advise businesses and industry alike on their role in the climate emergency.
With data centres expected to deliver a 50% increase in electrical footprint by 2025 and be responsible for around 1% of global electricity usage, sustainable choices must be prioritized alongside achievable targets.
To satisfy the Climate Neutral Data Center Pact’s (CNDCP) objectives for energy efficiency, renewables, water use, recycling, and reuse of waste heat, faster changes are needed. This is not just important for climate change, but for securing customers. 75% of data centre operators have lost business due to not having the right sustainability programs or practices in place, the time to act is, therefore, now.
Data centres are on the two sides of the same coin
The answer to Europe’s energy security problem is the same as the answer to decarbonisation - Electricity 4.0 – which signifies electrification and digitalisation at scale and uses renewables, smart technology, and data centres to create a grid fit for the future.
Today the grid is no longer linear and one-directional, but bi-directional and flexible. We can establish electric and digital solutions at scale for smarter, greener, more flexible energy, and move away from a linear supply of fossil fuel without limited control and optimisation. In future, we may source more power from local wind farms, your neighbours who have produced excess electricity from the solar panels on their roofs, or your electric car battery when it is not in use. The possibilities are endless.
There is no shortage of energy, it’s how it is used that is the problem. From production to endpoint, 60% of energy is wasted in transportation. Boosting energy efficiency reduces the demand on the grid with more energy reaching its final destination, and is another area where data centres will play a pivotal role in the grid of the future.
Data centres are already leading the charge and achieving greater operational and energy efficiencies and can play an important role in boosting energy security via electrification. As large-scale energy users with the infrastructure to support both a prosumer model and a bi-directional grid, data centres can enable the production and adoption of renewables.
As our electrical grid becomes increasingly data-driven and automated, the energy sector will increase its reliance on data centres for continuity and resilience. This is where we need to reposition data centres as a critical element in delivering a more sustainable future.
Take Schneider Electric’s work with Aeven, for example. Working together, we have developed an industry-first solution that combines customized uninterruptible power supplies (UPS) and machine-learning software, allowing Aeven to control and automate its on-site energy resources, and help stabilize the Danish grid.
Working with the Danish Transmission System Operator (TSO), Energinet, Aeven has created a Fast Frequency Reserve (FFR) pool where energy-intensive sectors, such as the data centre sector, can support the grid during times of peak demand. In 2022, it also delivered 1MW of capacity from one of its data centres, while reducing energy waste in its UPS by 68% per year. This is just one example of data centres’ role in the energy revolution.
Moving into a new energy landscape
What is certain is that the crisis has reshaped the global energy sector for good. Now, the market is prepared for forthcoming uncertainties - and better equipped to deal with them.
With data centres being at the heart of digitalisation, the industry is essential to address and accelerate climate ambitions in Europe. It is on two sides of the same coin, both fighting climate change and pushing for the ‘green’ revolution of the current energy market. Through automation and data analytics, data centre leaders can create sites that have efficiency and sustainability at their core.
My biggest hope is that the economic uncertainty we have seen doesn’t derail the sustainability agenda. With the EU shifting to build a more sustainable energy system, this is a period of opportunity to achieve net zero and fight climate change.
Understanding the possibilities enabled by data centres can answer some of the toughest questions on where to go next in cutting emissions. The data centre industry has a shared vision of sustainable growth that meets society’s needs for digital services in an environmentally sustainable manner.
We must all work together - policymakers to business leaders, IT to electrical partners - to solve emerging challenges, drive positive influence, and innovate in the data centre industry and beyond.
