The EU plans to roll out energy labels for data centers by 2027, but critics argue the system ignores key environmental factors and is influenced by tech giants like Microsoft.
EU plans energy label for data centers
The European Union is planning to introduce an energy label for data centers, modeled after household appliance ratings, to evaluate their environmental performance. The system, set to take effect from mid-2027, would assign ratings ranging from A to G based on metrics such as power usage effectiveness (PUE) and water usage effectiveness (WUE). Critics question label's environmental scope
These metrics measure energy and water efficiency, but critics argue that they do not fully capture the environmental impact of data centers. The European Commission aims to harmonize practices across the EU, guide public policies, and promote the acquisition of more sustainable digital assets. However, the proposed system has faced criticism from NGOs and experts who argue that it lacks transparency and fails to account for key environmental factors. EU data center capacity to triple
The EU plans to triple its data center capacity within the next five to seven years, citing the need for technological independence and digital sovereignty. This expansion could increase data center electricity consumption from 68 terawatt-hours (TWh) in 2024 to 114 TWh in 2030, representing more than 3% of the EU's electricity demand. Growing demand for AI raises resource needs
The growing demand for artificial intelligence is expected to further increase energy, water, and infrastructure needs. The label would be automatically calculated based on self-reported data from data center operators, raising governance concerns. Label excludes key environmental factors
It would include the name, size, and location of the site, its energy sources, and the PUE and WUE ratings. However, the label does not include a climate indicator or greenhouse gas emissions, which critics argue are essential for assessing environmental impact. Benoît Petit, co-founder of Hubblo, pointed out that the Commission had almost verbatim adopted an amendment proposed by Microsoft in 2024, which excluded climate indicators from the label. Efficiency vs. environmental impact
Alex Lutz, a policy officer at Data for Good, emphasized that PUE and WUE are efficiency indicators, not environmental indicators. These metrics show how resources are used, not how much is consumed. A data center could thus achieve an excellent score while still consuming significant amounts of electricity and water. The label also overlooks the manufacturing and renewal of servers, their recyclability, noise, and heat rejection. Exclusion of public data access
Another concern is the exclusion of electricity and water consumption data from public access, a provision that critics argue is inspired by Microsoft and the DigitalEurope lobby. Bram Vranken, a researcher at the Corporate Europe Observatory, noted that this exclusion prevents informed decision-making for territorial development. In Ireland, data centers already consume 25% of the national electricity, which has affected housing development due to limited electrical capacity. Residual heat potential
The potential for utilizing residual heat from data centers to heat nearly four million European households was highlighted by Anna-Kaisa Itkonen, a spokesperson for the European Commission on climate and energy. However, the implementation of such a system would require adapted buildings, distribution networks, and significant investments. Political debate over confidentiality
The debate has also entered the political sphere. A group of environmental elected officials has called on Brussels to remove the confidentiality clause on the energy efficiency of data centers, which they believe is influenced by Microsoft and the DigitalEurope lobby. The clause remains in the delegated act published in late September. Legal loopholes and opposition challenges
David Cormand, a green European MEP, warned that the label could facilitate the installation of large data centers in dedicated areas with simplified procedures, potentially circumventing environmental requirements normally applicable to industrial installations. In France, the law on simplifying economic life allows for the acceleration of certain data center projects classified as "major national interest projects," with possible exemptions in terms of urban planning and the environment. While it may be possible to block the European device, it is considered difficult, with the Parliament or member states potentially opposing it.
