What are the Environmental Consequences of Data Centers?

By Brett SmithReviewed by Laura ThomsonOct 24 2025

Environmental concerns related to data centers have been around for years and are only getting bigger. In addition to growing demand for more processing power, driven by the rise of artificial intelligence, massive tech companies have started building hyperscale data centers. 

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These new data centers are even more ravenous when it comes to energy, water, and land demands. For example, the previous generation of data centers can demand as much as 10 megawatt hours per month, while hyperscale data centers typically use 100 or more megawatt hours per month.¹

This article will highlight the environmental consequences of data centers, responses to these consequences, and emerging clean technology solutions.

How Much Energy Do Data Centers Use?

The amount of energy used by data centers is constantly growing. In 2023, data centers in the US used nearly 180 terawatt hours of electricity, representing 4 % of total US electricity demand.² By 2028, usage is expected to increase by 6 to 12 %, demonstrating a significant share of the total demand projection of 15 to 20 % through the end of the decade.³

Key Environmental Impacts

The environmental consequences of data centers include carbon emissions, high water usage, electronic waste, and land use.

a. Carbon emissions

According to the International Energy Agency (IEA), data centers are responsible for between 1 and 1.5 % of global carbon emissions.⁴ However, data centers could be emitting more carbon than has been officially reported.

An independent analysis by The Guardian indicated that real emissions from data centers owned by Apple, Google, Meta, and Microsoft are likely more than 7.6 times their reported emissions.⁵

In addition to carbon emissions, many data centers release large amounts of nitrogen oxides and other pollutants from their backup generators, which are used during high-demand periods.⁶ These air pollutants pose risks to human health and the environment.

b. Water use

Data centers use water to cool their servers in two different ways. Evaporative cooling methods release water vapor into the environment, while non-evaporative cooling methods recover water for reuse or discharge it into the environment.

While tech companies are relatively transparent when it comes to releasing data on energy use and emissions, they are less transparent when it comes to reporting water consumption. In a recent report from Google, the company acknowledged that one of its data centers used more than 20 billion liters of water per year, which was used for both cooling and generating electricity.⁷

To make matters worse, many data centers are located in arid regions, especially in the US. Approximately two-thirds of data centers built in the US since 2022 are located in water-stressed regions.⁸

c. Electronic waste and land use

Data centers also generate significant electronic waste and require large tracts of land. Electronic waste typically contains hazardous materials such as lead and mercury. The typical computer requires more than 800 kilograms of raw materials, which includes rare earth elements that are often mined in non-sustainable ways.⁹

Another key impact of data centers is the significant amount of land they require, which could be left as green space or used more sustainably. For example, Meta is planning a data center in Louisiana to occupy 2,225 acres of former farmland, taking a large swath of arable land off the map. The data center will require significant infrastructure upgrades to support it, but it will only produce several hundred new jobs, which is not a significant increase in tax revenue.

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Industry Responses: Greener Infrastructure

The environmental consequences of data centers are so acute that the tech industry has taken action to address them. Meta has pledged to match its electricity use with clean and renewable energy production for the data center it is planning for Louisiana. The company has also pledged to restore more water than the facility uses.

Other large tech companies have made similar gestures related to their overall operations. Google has pledged to achieve net-zero carbon emissions by 2030, while Amazon has set the same goal for 2040. Notably, smaller tech companies lack the capital to make similar pledges for their data centers.¹⁰

Clean Technologies Driving Sustainable Data Centers

As technology companies work to make their data centers more sustainable, several key clean technologies are emerging as viable solutions.

a. Liquid immersion cooling and advanced HVAC

Liquid immersion cooling is an emerging approach that involves fully submerging servers in a thermally conductive and electrically nonconductive liquid. The circulating liquid removes heat more efficiently than traditional fans and ventilation.

The latest technologies, such as heat exchangers and high-efficiency filters, make HVAC systems more sustainable by lowering power demands.

b. AI for energy optimization

Companies are increasingly using AI to design, maintain, and optimize the energy efficiency of their data centers. AI can be used for everything from server physical configuration to airflow management and predictive maintenance.

c. Modular data centers

Comprised of prefabricated mobile units with configured equipment, modular data centers allow for more flexibility with respect to location, timing, scaling, and maintenance. Their mobility allows them to be placed closer to renewable energy sources or natural cooling sources, reducing environmental impacts. These data centers also support right-sizing processing power to better fit demand, reducing waste.

d. Battery storage and microgrids

Battery storage and microgrids increase the power resilience of their data centers and improve sustainability when combined with renewable energy sources. Microsoft recently announced it would partner with a microgrid provider and energy project developer to protect a new data center in San Jose from grid outages.¹¹

In addition to protecting against outages and supporting renewable energy, microgrids allow operators to route power dynamically based on need. This approach is much more sustainable than building grid infrastructure based on projected maximum demand.

Policy and Standards Supporting Sustainability

Most policies and standards supporting data center sustainability are focused on transparency and providing incentives. In the European Union, the Energy Efficiency Directive compels data center operators to report on their operations' energy performance. The European Commission is responsible for collecting and publishing this data to highlight any data centers “with significant energy consumption.”

Some European nations have gone a step further by imposing standards for data center efficiency. In Germany, the Energy Efficiency Act set standards for data center cooling systems and mandates the reuse of energy, such as waste heat.

In the US, the most significant policies are at the state level. Rather than offering unconditional incentives to lure data centers, states are increasingly attaching requirements to incentive packages, often requiring third-party certifications such as LEED. For example, Michigan recently enacted an incentive package that required companies to show their data center uses clean energy, meets specific energy efficiency targets, and is connected to the municipal water system.¹²

Future Outlook: Building the Sustainable Cloud

Advances in clean energy technology will undoubtedly lead to more sustainable data centers, but there are industry-specific developments that have significant potential for a more sustainable cloud.

Direct-to-Chip (DTC) and immersion cooling are being touted as more efficient methods than conventional HVAC cooling. Data center operators are also developing ways to repurpose waste heat. For example, a city district in Dublin is looking to send waste heat from a data center to provide hot water and heating to public housing.¹³

Backed by industry initiatives and public policy, the push toward more sustainable data centers will increase, but so too will the industry's environmental footprint.

References and Further Reading

1. Spencer, T. et al. (2024 October 18). What the data centre and AI boom could mean for the energy sector. International Energy Agency.  https://www.iea.org/commentaries/what-the-data-centre-and-ai-boom-could-mean-for-the-energy-sector
2. Office of Cybersecurity, Energy Security, and Emergency Response (CESER). (2021 March). State of New Jersey State Energy Risk Profile. Department of Energy. https://www.energy.gov/sites/default/files/2021-09/New%20Jersey%20Energy%20Sector%20Risk%20Profile.pdf
3. Shehabi, A. et al. (2024). 2024 United States Data Center Energy Usage Report. Lawrence Berkeley National Laboratory, Berkeley, California. LBNL-2001637. https://doi.org/10.71468/
4. International Energy Agency. (Retrieved 2025 October 21). Data Centres and Data Transmission Networks. https://www.iea.org/energy-system/buildings/data-centres-and-data-transmission-networks
5. O’Brien, I. (2024 September 15). Data center emissions probably 662% higher than big tech claims. Can it keep up the ruse? The Guardian. https://www.theguardian.com/technology/2024/sep/15/data-center-gas-emissions-tech
6. State of Washington Department of Ecology. (Retrieved 2025 October 21). Diesel pollution from data centers. https://ecology.wa.gov/air-climate/air-quality/data-centers
7. Li, P. et al. (2025). Making AI Less “Thirsty”: Uncovering and Addressing the Secret Water Footprint of AI Models. Communications of the ACM. https://dl.acm.org/doi/10.1145/3724499
8. Nicoletti, L., Ma, M., & Bass, D. (2025, May 8). AI is Draining Water from Areas that Need it Most. Bloomberg. https://www.bloomberg.com/graphics/2025-ai-impacts-data-centers-water-data
9. United Nations Conference on Trade and Development. (2024). Digital economy report 2024: Shaping an environmentally sustainable and inclusive digital future. https://unctad.org/system/files/official-document/der2024_en.pdf
10. Monserrate, Steven Gonzalez. (2022). The Cloud Is Material: On the Environmental Impacts of Computation and Data Storage. MIT Case Studies in Social and Ethical Responsibilities of Computing. https://doi.org/10.21428/2c646de5.031d4553
11. Microgrid Knowledge Editors. (2023 December 13). Microsoft Tapping into Microgrids and RNG to Power Data Center During Grid Outages. Microgrid Knowledge. https://www.microgridknowledge.com/commercial-industrial-microgrids/article/33016385/microsoft-tapping-into-microgrids-and-rng-to-power-data-center-during-grid-outages
12. Hancock, I. (2025 September 25). The impact of state and local incentives on sustainable data centers. US Green Building Council.  https://www.usgbc.org/articles/impact-state-and-local-incentives-sustainable-data-centers
13. South Dublin City Council. (2023 April 6). Tallaght District Heating Network and Energy Centre officially opened. https://www.sdcc.ie/en/news/tallaght-district-heating-network-and-energy-centre-officially-opened.html

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