EU’s Pursuit of Sustainability: Impact of the Energy Efficiency Directive on Data Centres

The European Commission has brought forward a new initiative to enhance sustainability in EU data centres, introducing an EU-wide scheme aimed at rating their sustainability. This move seeks not only to boost energy efficiency but also to address critical areas such as reducing energy and water consumption, while pushing for the adoption of renewable energy sources and the innovative use of waste heat.

With data centres responsible for nearly 3% of the EU’s electricity demand—a figure set to rise—the significance of this directive in the broader context of climate change, energy savings, and the energy transition cannot be overstated.

This new directive, part of the “promoting climate-neutrality actions for the IT sector” within the Action Plan for the Digitalisation of the Energy Sector, heralds a major shift towards sustainability. By establishing a reporting and rating system for data centres across EU countries, the directive lays down a clear pathway for data centres to contribute significantly to the EU’s ambitious sustainability and energy efficiency goals, resonating deeply with the overarching aim of mitigating climate change impacts.

The Impact of the Directive on Data Centre Sustainability

The European Commission’s directive on data centre sustainability marks a step towards integrating environmental considerations into the core operations of the IT sector. This initiative is driven by a multifaceted approach to sustainability, encapsulated in several key objectives including:

Transparency Enhancement: By mandating data centres to report key performance indicators (KPIs) to a European database, the directive fosters a culture of transparency, allowing stakeholders to monitor and assess the environmental impact of data centre operations.

Promotion of Efficiency and Innovation:
- Energy Consumption: A pivotal goal is the reduction of energy usage, aligning with the broader EU target to decrease energy consumption by 11.7% by 2030.
- Water Usage: The directive emphasizes the importance of minimizing water consumption, reflecting a growing awareness of water as a critical, yet finite resource.
- Renewable Energy: Encouraging the use of renewable energy sources is a cornerstone of the directive, supporting the EU’s transition to a sustainable energy system.
- Waste Heat Utilization: The directive advocates for the innovative reuse of waste heat, promoting synergy between data centres and local heat networks.

Legislative and Regulatory Framework:
- EU Green Deal and Energy Efficiency Directive (EED): These form the legislative backbone, setting forth ambitious goals for energy savings and carbon neutrality.
- Specific Requirements for Data Centres: Data centres with a total rated power above certain thresholds are subject to detailed energy performance reporting, including the use of waste heat and renewable energy sources.

This strategy underscores the EU’s commitment to steering the IT sector towards a sustainable future, leveraging legislative measures to mitigate environmental impact while fostering innovation and efficiency in data centre operations.

Challenges and Considerations

Navigating through the labyrinth of sustainability and efficiency mandates, data centres across the EU face a complex array of challenges and considerations. Notably:

Regulatory Ambiguity: While the EU Green Deal, Code of Conduct (CoC), EED, and EN 50600 set forth ambitious goals, they lack explicit instructions on methods for reducing energy consumption. They suggest practices like focusing on Power Usage Effectiveness (PUE) as a sustainability driver, yet specifics remain vague.

Data Collection Hurdles:
- A mere 19% of data centres collect server utilization statistics, and only 29% possess a data management system capable of gathering the requisite information.
- Multi-tenant environments amplify the challenge of data collection, complicating efforts to comply with reporting requirements.

Emerging Requirements and Metrics:
- The German Energy Efficiency Act mandates a PUE of 1.2 for new data centres by 2026, setting a precedent for stringent efficiency standards.
- The European Commission (EC) is developing new metrics such as the work per energy metric, alongside established ones like PUE and Renewable Energy Factor (REF), to guide data centres towards sustainability.
- Data centres will be classified into four categories—enterprise, colocation, co-hosting, and network operator—with reporting standards consistent across all categories.

These challenges underscore the urgent need for data centres to adapt swiftly, leveraging innovative methodologies to meet evolving sustainability benchmarks.

Criteria for Sustainability Rating

In alignment with the Energy Efficiency Directive, data centres across the EU are mandated to adhere to a set of criteria for sustainability rating. These criteria are meticulously designed to encapsulate the multifaceted nature of data centre operations and their environmental impact:

Mandatory Reporting Dates and KPIs:
- Initial reporting to the European database is required by 15 September 2024, with subsequent annual reports due by 15 May.
- Key Performance Indicators (KPIs) include Power Usage Effectiveness (PUE), Water Usage Effectiveness (WUE), Energy Reuse Factor (ERF), and Renewable Energy Factor (REF).

Detailed Sustainability Indicators:
- Energy Performance: Data centres must publish detailed information on their energy performance, including energy consumption levels and efficiency measures.
- Environmental Performance: Reporting on environmental performance encompasses power utilisation, temperature management, cooling efficiency ratios, and water usage.
- Innovation in Energy Utilisation: Criteria include the use of renewable energy sources, heat utilisation, energy reuse practices, and, for data centres with a total rated energy input exceeding 1MW, waste heat recovery protocols.

Adherence to Established Standards and Directives:
- Compliance with the Corporate Sustainability Reporting Directive (CSRD) requires data collection on PUE, IT Equipment Energy Efficiency (ITEEsv), and IT Equipment Utilisation (ITEUsv) starting from 1 January 2024.
- Utilization of EN 50600 / ISO 30134 KPIs and adherence to the Green Grid Data Centre Maturity Model and the European Code of Conduct for Energy Efficiency in Data Centres (EU DC CoC) are essential.
- The EC has identified four critical EN 50600-4 metrics for assessment: PUE, WUE, REF, and ERF, with considerations for minimum performance thresholds and a rating-based labelling system tailored by data centre type and redundancy level.

Impact on Data Centre Owners and Operators

The introduction of the Energy Efficiency Directive (EED) and the Corporate Sustainability Reporting Directive (CSRD) will impact data centre owners and operators across the Union. These directives mandate a shift towards enhanced energy efficiency and sustainability reporting, with specific requirements set to take effect from May 2024. Here, we explore the multifaceted impact of these directives on data centre owners and operators:

Mandatory Reporting and Energy Efficiency Measures:

Mandatory Reporting and Energy Efficiency Measures:
- From May 2024, data centres with a capacity larger than 500kW are required to report their energy efficiency figures, including energy consumption data and Power Usage Effectiveness (PUE).
- Operators must implement energy efficiency measures aimed at reducing overall energy consumption by 11.7% by 2023, focusing on waste heat utilization, renewable energy integration, and optimizing energy consumption.

Benefits of Compliance:
- Reduced energy costs through the implementation of energy-saving measures.
- Enhanced public image and competitiveness by demonstrating commitment to environmental protection and sustainability.
- Improved resiliency and operational efficiency through the adoption of best practices in energy management and the utilization of Data Centre Infrastructure Monitoring (DCIM) tools.

Technological Solutions and Industry Support:
- Solutions like Schneider Electric’s DCIM tools and TycheTools’ ECOaaS software assist in monitoring and optimizing IT equipment performance, facilitating compliance with the EED.
- The EU DC CoC provides guidance and awards to data centre operators and owners who effectively adopt CoC best practices, significantly reducing energy consumption. Companies can also act as Endorsers, promoting EU DC CoC to their clients.

The EU’s Energy Efficiency Directive and Corporate Sustainability Reporting Directive are pivotal for data centres in reducing energy consumption and promoting innovation. Mandated reporting, renewable energy adoption, and waste heat reuse pave the way for data centres to contribute to sustainability goals. Compliance brings reduced energy costs, enhanced competitiveness, and a positive public image.