Cloud Providers Rethink Cooling to Cut Waste

Data centres are expanding rapidly to meet the growing demand for AI and cloud services, but they may be approaching an environmental tipping point as energy and water usage continue to surge.

The cloud computing sector is progressing quickly, often focusing on performance and scale. At the same time, data centres globally now consume about 4% of the world's electricity, and that number is expected to increase. As a result, the environmental footprint of these facilities is gaining attention. In response, cloud providers are taking steps to make their infrastructure more sustainable, even as performance standards stay high.

In regions such as Singapore, where power and water resources are tightly regulated, governments have started enforcing efficiency requirements. New data centres there must meet a maximum Power Usage Effectiveness (PUE) of 1.3. Most operators are still working toward that benchmark. However, some companies have already adopted water-saving cooling solutions, using closed-loop systems that minimize evaporation and significantly reduce water usage.

One major global cloud provider reports a fleet-wide average PUE of 1.26 and a Water Usage Effectiveness (WUE) of 0.37, which is five times more efficient than traditional cooling systems. Their servers are cooled directly at the component level using in-house technology that eliminates water loss and makes it possible to build more compact and efficient data centre layouts. This approach not only conserves resources but also reduces the amount of physical space required.

Sustainability at scale is becoming more than a branding message for certain providers. By managing their supply chains internally and recycling server parts, they are moving toward zero waste and cutting greenhouse gas emissions across all operations. Their targets include a 73.4% cut in Scope 1 and 2 emissions by 2025 and a 52% drop in Scope 3 emissions by 2030. These environmental improvements often result in lower operating costs, giving providers the ability to offer competitive pricing while conserving energy and water.

The data centre industry in Europe is also making collective progress. With support from the EU, over 100 companies have joined the Climate Neutral Data Centre Pact. This group includes some of the industry's largest players who have pledged to reach carbon neutrality by 2030. Their commitments include relying entirely on renewable electricity and reusing aging server equipment. The pact aims to keep sustainability a clear priority as demand for AI-powered services continues to rise.

Some providers have recently introduced tools that track carbon emissions, letting customers monitor the environmental impact of their cloud usage. This kind of visibility is becoming a vital feature as more businesses face pressure to meet ESG goals and provide climate-related disclosures.

As environmental regulations get stricter and customers look for greener technology, having sustainable infrastructure is no longer just an advantage. It could become the key differentiator in a competitive cloud market.

Source: Australian Financial Review,