Data Centers & District Energy

Data centers are rapidly becoming one of the largest and fastest-growing energy users in North America, creating both unprecedented challenges and powerful opportunities for district energy systems. 

Synthesis Report - Data Centers & District Energy Northern Virginia Workshop

Workshop sponsored by IDEA, Ministry of Foreign Affairs of Denmark, Northern Virginia Regional Planning Commission, Ramboll

This data center & district energy workshop, hosted on December 10th at George Mason University, marked a material inflection point in the conversation in Northern Virginia on data centers and district energy. The discussion moved decisively beyond whether data center heat reuse is technically feasible where participants overwhelmingly agreed it is and instead focused on how to structure markets, partnerships, and projects capable of delivering near-term pilots and long-term scale.

Data Heat - Sector Coupling of Data Centers & District Heating Report

February 2026

Authored by Reshape Strategies

Sponsored by the Ministry of Foreign Affairs of Denmark, NYSERDA, and IDEA

Data centers are major electricity consumers, and nearly all the electricity they consume ultimately winds up rejected as waste heat. In years to come, the amount of electricity consumed by data centers will increase significantly. Not only will their waste heat volumes grow in magnitude, but the quality of that waste heat will also increase, as changes in data centre design and operations mean that data centers will reject higher temperature waste heat, making it more favorable for heat re-use in the district heating sector. At the same time, there will also be increasing demands placed on the electric grid from decarbonizing heating and transportation. This presents both a challenge and an opportunity.

• Challenge: How can the electric grid keep pace with the demands from data centers, as well as electrifying heating and transportation, while meeting climate targets, at the least cost while maintaining reliability?
• Opportunity: Re-using waste heat from data centers helps avoid using fossil fuels to heat buildings (helping meet climate targets), and can also reduce the burden on the electric grid (reducing costs and supporting reliability).

Read the full report

Data Center News

  • Capacity Summary Microsoft has officially opened its new Danish data centre region to provide Microsoft customers in Denmark with local and secure cloud infrastructure. Referred to as Denmark East, the new data centre region has campuses in Høje Taastrup, Køge and Roskilde on Zealand. The region has been designed with sustainability as a critical priority, with Microsoft having entered into long-term power purchase agreements (PPAs) to provide 130 megawatts (MW) of renewable energy every year. It will also use HVO for backup power generation across the region. The company said its data centre site in Høje-Taastrup will be Microsoft’s first operational at-scale waste heat recovery in Denmark – with the data centres engineered to recovery surplus heat for local district heating systems. It will have the capability to heat around 6,000 homes in the local area at first, with future expansion planned in Køge, the company said. Continue Reading #News #DataCenter #DistrictHeating

  • w. media Summary Berlin’s research landscape will soon get a new AI facility and data center through a collaboration between the Zuse Institute Berlin (ZIB) and Helmholtz-Zentrum Berlin (HZB). The center aims to provide scalable, secure infrastructure for high-performance computing (HPC), data management, and AI applications. According to a press release, development will start in 2026-2027 with consolidated infrastructure at ZIB in Dahlem and a new site at HZB in Adlershof. By 2029-2030, additional computing capacity will be added. Sustainability is a priority, including energy-efficient hardware and plans to use waste heat locally. Continue Reading #News #DataCenter

  • DataCentre Summary atNorth and Kesko have brought a new heat reuse partnership online, marking a step forward in integrating circular economy principles into data centre operations. The initiative channels waste heat generated by atNorth’s FIN02 data centre in Espoo to a neighbouring Kesko retail store, repurposing excess heat from the facility’s infrastructure. The project is supplying almost all of the store’s heating requirements, which reduces its reliance on district heating while hitting sustainability targets by lowering emissions for both organisations. Continue Reading #News #DistrictHeating

  • MSN Summary Echelon Data Centres' DUB20 data centre campus in Arklow, Co Wicklow will become Ireland's first Green Energy Park. Green Energy Parks are defined by the Department of Enterprise, Trade and Employment as developments that co-locate large energy users, such as data centres, with renewable energy generation. They are required to be primarily powered by renewables with battery storage or dispatchable backup from energy centres, can demonstrate reduced reliance on the national grid, and can promote innovation and system-wide benefits, such as using waste heat for district heating schemes. Continue Reading #News #DataCenter

  • Microsoft Summary Microsoft today announced the official opening of its new Danish datacenter region, Denmark East, with campuses in Høje Taastrup, Køge, and Roskilde on Zealand. The datacenter region will provide Danish Microsoft customers with local, secure state of the art cloud infrastructure designed with sustainability as a key focus. The opening of the new datacenter highlights that Køge is an attractive location for large, future-proof projects. We have strong infrastructure, attractive business areas, and a strategic location that makes it possible to develop new solutions and create value locally. This is exciting for Køge and for the entire surrounding region, and we welcome Microsoft. At the same time, we are pleased that, over time, Microsoft’s new datacenter will contribute surplus heat to the local district heating network. Continue Reading #News #DistrictHeating #DataCenter

  • Computing Summary Ireland was the canary in the coal mine. The country was an early leader in the datacentre building frenzy, driven by favourable tax rates for tech companies, subsea data cables to the US and the UK and a skilled workforce. Datacentres sprouted like mushrooms around Dublin - until one day they didn’t. In 2021, regulators imposed an effective moratorium on new datacentre builds around Dublin because of the massive demand for power and worries about the stability of the grid. At the end of last year, the authorities unveiled a plan. Datacentres and other “large energy users” would once again be able to connect to the grid, but only under strict conditions. These include generating their own power while also contributing to grid stability. In other words, they must act as energy infrastructure participants, not just passive consumers. Moreover, at least 80% of annual electricity demand must be matched by new renewable generation, with developers allowed a six-year "glide path" for renewables to be deployed. In addition, operators are obliged to submit annual emissions figures. This arrangement specifically favours microgrids. On emissions, the plan is to phase in renewables, with the Dublin site becoming operational net zero by 2040. The structure includes heat recovery for potential combined heat and power (CHP) export for community use and rainwater harvesting. Continue Reading #News #DataCenter #CHP ...

  • The International District Energy Association (IDEA) announced today that registration is now open for the 117th IDEA Annual Conference and Trade Show (IDEA2026). The event will take place June 23 to 26, 2026, at the Rogers Centre Ottawa in Ottawa, Ontario, Canada. IDEA2026 will convene the global district energy community for three days of education, innovation, networking, and technology discovery, bringing together leaders and practitioners shaping the future of district energy. This year’s theme, “Connecting Networks,” highlights both the interconnected nature of district energy systems and the people and partnerships that bring them to life, supporting community decarbonization, resilience, and long-term sustainability. “District energy succeeds when people and systems connect,” said Rob Thornton, President and CEO of IDEA. “IDEA2026 in Ottawa reflects the industry’s focus on strengthening partnerships, improving system integration, and accelerating progress through collaboration. We’re bringing our international community together to help cities and campuses meet their energy and resiliency goals.” IDEA2026 programming will feature an extensive educational experience including preconference workshops, podium presentations organized by technical track, poster sessions, plenary panels, exhibit-hall learning, dedicated opportunities for peer-to-peer networking, and technical tours of local district energy systems. The IDEA2026 Exhibit Hall will showcase technologies, ...

  • World Economic Forum Summary Every industrial age delivers its own plot twist. The 19th century had steam, the 20th had oil, and the early 21st was supposed to be defined by a harmonious rise of clean energy and digital transformation. Instead, a new character has entered the story with disruptive force: the artificial intelligence-era data centre. What was once an invisible backend of the digital economy has become one of the most powerful drivers of global electricity demand , and an unmissable risk for leaders setting intention at the beginning of the year. Across Europe, billions are spent annually to heat homes with gas and other fuels. At the same time, data centres, which operate continuously, vent enormous quantities of low-temperature heat into the sky. In London , research suggests that as much as 1.6 TWh of heat from data centres could be recovered each year, enough to warm half a million homes. Across Europe, the theoretical potential is 221 TWh per year, or 12% of EU district-heating demand. The infrastructure exists. The heat exists. The urban demand exists. What doesn’t exist is the policy coordination to connect the dots. Continue Reading #News #DistrictHeating #DataCenter

  • Argus Media Summary Google's contract with electric utility DTE Energy to power a 1GW data center in Michigan points to an emerging framework that shifts financial and capacity obligations on to large load customers. Google signed a 20-year power supply agreement (PSA) with DTE that commits the tech giant to paying the full cost of adding 1600MW of renewable power and 480MW of battery storage for a data center supporting artificial intelligence (AI) in Van Buren Township, Michigan, according to a DTE filing this week with the state regulator Michigan Public Service Commission (MPSC). Google also agreed to provisions intended to minimize financial risks for the utility in case its plans change. "The special contracts establish a balanced and protective framework that includes appropriate safeguards and minimizes the risks associated with service large load customers," DTE said in the filing. Continue Reading #News #MemberNewsIDEA #DTEEnergyServices #DataCenter

  • Google Summary Today, we announced plans to develop a new data center in DTE Energy ’s service territory in Michigan and shared details of our energy-first approach in partnership with DTE. As part of the agreement, we will be adding clean, around-the-clock power directly to the grid to support the new data center, enhance the state’s grid reliability and further establish Michigan as an innovation leader in infrastructure development. Google is committed to responsibly growing its infrastructure by expanding local energy supply and funding energy affordability initiatives in the communities where it operates. As part of this announcement, Google is introducing a $10 million Energy Impact Fund to scale and accelerate energy affordability initiatives that are designed to drive down monthly bills for communities in Michigan. These include home weatherization, efficiency technology innovations for households and energy workforce development projects. Google will kick off a funding application process for local organizations. Continue Reading #News #MemberNewsIDEA #DTEEnergyServices #DataCenter

  • West Virginia Public Broadcasting Summary It looks like West Virginia is getting an early jump in the race to power the nation’s artificial intelligence data centers – and it’s happening in Mason County. Nscale , a London-based tech company that builds and operates the infrastructure needed for artificial intelligence development, is setting up shop on the 2,200 acre Monarch Compute Campus in Mason County. Under a new deal the company secured with Microsoft, Nscale plans to build and operate an advanced AI data center powered by a microgrid that will begin operation by late 2027. Continue Reading #News #DataCenter #Microgrids

  • Power Engineering Summary Caterpillar moved to the center of the AI infrastructure buildout this week as developer Nscale said it would use the company’s natural gas generator sets to power a major new West Virginia data center campus tied to Microsoft and NVIDIA. Monday’s announcement positions Caterpillar’s G3500 series reciprocating engine platform as core infrastructure for what Nscale said could become one of the country’s largest dedicated AI compute developments. Under the plan, Caterpillar equipment would support 2 GW of onsite generation by the first half of 2028 at the Monarch Compute Campus in Mason County, West Virginia, giving the project a faster path to power as grid access and transmission upgrades remain a constraint for large data center loads. Continue Reading #News #DataCenter #MemberNewsIDEA #Caterpillar

  • The Globe and Mail Summary Bell Canada is partnering with the Government of Saskatchewan to build a 300 MW AI-focused data centre in the Rural Municipality of Sherwood near Regina, in what it calls its largest-ever investment in the province and the largest purpose-built AI data centre project in Canada The project is expected to generate up to $12 billion in economic value for Saskatchewan over time, with at least 800 construction jobs, 80 permanent roles and potentially hundreds of additional community jobs, underscoring its role in regional growth and diversification. Tenants Cerebras and CoreWeave will provide high-performance AI compute based on wafer-scale systems and NVIDIA GPUs, while Bell commits to community partnerships, Indigenous procurement, academic collaboration and sustainable design features such as closed-loop cooling and potential district energy heat reuse. Continue Reading #News #District Energy #DataCenter

  • HSToday Summary There are 570 data centers in the state of Virginia, the majority of which are in the northern portion of the state often referred to as Data Center Alley. Virginia has the largest and most concentrated data center market in the world, with some estimates indicating that the region handles up to 70% of global internet traffic. Several qualities make the region a prime location for data centers: a supply of reliable and affordable energy, a strong fiber network, flat land for building footprints, water for cooling, location near major national customers, educated and skilled labor force, and a state tax regime that incentivizes the development of data centers. Another concern connected to data centers is energy waste. According to a report written by Reshape Strategies, “nearly all the electricity they consume ultimately winds up rejected as waste heat [into the atmosphere].” One suggested way to optimize energy use is to convey the wasted heat generated by data centers to heat for buildings through a district energy system (DES). 3 These systems capture “wasted” heat from one building and use it to heat another, reducing consumption needs. DES are advantageous because they ensure reliable, stable heating, reduce peak power demand and grid load, and increase efficiency via economies of scale by capturing otherwise wasted energy. xxv Recycling wasted heat through a DES could “increase energy efficiency, lower Green House Gas (GHG) emissions, ...

  • CNBC Summary Just outside Ireland’s capital, Dublin, a data center has become the first in Europe to turn to an independent, so-called “islanded,” microgrid to keep its servers running. Europe is looking to cash in on the AI boom while tackling power connection delays that have persisted for decades. The European Commission estimates the bloc needs at least 1.2 trillion euros ($1.39 trillion) in investments by 2040. In some cases, companies can’t wait for bottlenecks to be eased and are turning to their own sources of power. The Dublin facility, operated by digital infrastructure developer Pure Data Centre Group, which partnered with power supply solutions provider AVK, could mark the continent’s first step toward a privately powered ecosystem. AVK and Pure DC say their Dublin installation is the first data center in Europe to be operated by a live microgrid. “As these data centers get bigger and we see AI workloads and that data becoming more of a feature in our day-to-day lives, that only puts more stress on the grid. So we have to drive to a different solution,” AVK CEO Ben Pritchard told CNBC. Continue Reading #News #DataCenter #Microgrids

  • Edscoop Summary The University at Buffalo last week announced that its North Campus will reuse heat energy put off by a supercomputing center being developed with funding from the state government and philanthropists. According to press materials, the arrangement will “significantly” reduce carbon emissions. The supercomputing initiative, called Empire AI, is intended to promote general research and advance work that betters humanity. The energy project will include connecting the supercomputing center to a chilled water plant via 30-inch “neutral temperature” water pipes and a network of geothermal wells. According to the release, “this integrated system will allow heat generated by Empire AI’s high-performance computing infrastructure to be recovered and redistributed to campus buildings, reducing overall energy use and accelerating UB’s path to carbon neutrality.” Continue Reading #News #DataCenter #WastetoEnergy

  • The Conversation Summary The electricity needed to power new Pennsylvania data centers already in advanced stages of planning could power 11 million homes – nearly twice the total number of households in the state. Companies that want to build data centers to expand their cloud and artificial intelligence computing are drawn to Pennsylvania due to its proximity to major East Coast cities, relatively affordable land and electricity, and legacy industrial infrastructure. For instance, there is a plan to turn an abandoned steel mill in Pittsburgh into a high-density data center that can leverage the existing infrastructure for electricity and water supply. Pennsylvania also has potential for geothermal cooling from its abandoned mines across the state. An example is Iron Mountain’s underground data center in western Pennsylvania, about an hour north of Pittsburgh. The data center is located 220 feet below ground in a former limestone mine . The stable and naturally cool subterranean environment – around 52 degrees Fahrenheit (11 degrees Celsius) – and underground lake reduce reliance on conventional mechanical cooling. Beyond efficiency, reusing waste heat can transform how we think about data centers. In Idaho, a startup is using server waste heat to support hydroponic greenhouses for year-round food production . In Paris, excess data center heat has warmed swimming pools used during the 2024 Olympics, and one of Meta’s data centers ...

  • Blog Entry

    American Planning Association Summary The recent surge in artificial intelligence (AI) use has driven a similar increase in data center development. In most cases, data centers are resource drains that negatively impact neighboring communities. An average data center uses between four and five times the energy of a similar-sized office building, and its servers generate so much heat that they need year-round, constant cooling. This waste heat can become a valuable resource, however, when it is used instead of fossil fuels to heat nearby buildings. A growing number of projects in the U.S. and around the world are now using data centers as heat sources for nearby buildings. In a data center waste heat recovery system, heat from the data center is captured from the air or water used to cool its servers, either through a heat recovery chiller or heat exchangers, and sent to a nearby heat load (user of heat) through connecting infrastructure, such as a district energy system. In the U.S., such systems are usually found on institutional campuses and in the downtown districts of legacy cities. Continue Reading #News #DataCenter

  • Prince George Cititzen Summary A tech company is looking for the City of Prince George to endorse a project to build a technology and education campus in the region, according to a letter attached to the Monday, March 9 city council meeting agenda. CedarCore AI Inc. writes that it's proposed Prince George-area facility would include an artificial intelligence data centre component. The cold climate, CedarCore said, means that minimal water will have to be used to cool the equipment in the proposed facility. BC’s access to clean electricity also means that the centre should have a low carbon footprint. Also proposed is a heat exchange system to help heat the campus’ own buildings, greenhouses or district energy systems. Continue Reading #News #DistrictEnergy #DataCenter

  • Department of Energy; use of waste heat from data centers; findings and recommendations; work group; report. Directs the Department of Energy to lead efforts to accelerate the use of waste heat from data centers in the Commonwealth by making certain findings and recommendations and convening a work group to provide expertise, assistance, and feedback on the Department's efforts. The bill requires the Department to submit a report of its efforts, findings, legislative proposals, and recommendations no later than September 1, 2026. Continue Reading #News #DataCenter

  • ReImagine Appalachia Summary As the first in what hopefully will become a series of materials and events promoting responsible data center development, ReImagine Appalachia today released Catching Heat: The Opportunities and Challenges of Using Waste Heat from Appalachian AI Data Centers , a groundbreaking report examining how the region can turn a byproduct of the AI boom into a resource for heating industry, homes, schools, hospitals, and businesses. As AI‑driven data centers rapidly expand across Appalachia, they bring both costs and benefits. The question is whether we can find a way to maximize the benefits and minimize the costs with more responsible data center development. Large, around‑the‑clock electricity loads from data centers are likely to drive higher greenhouse gas emissions, local air pollution, and higher energy bills for residents, businesses, and other industries unless we engage in energy planning and support new clean energy development to help meet those needs. This report hones in on the waste heat generated by AI data centers. Capturing and reusing this heat through district heating systems, thermal energy networks, or nearby industrial processes can improve overall energy efficiency, lower heating costs, and reduce associated water use, greenhouse gas emissions, and local air pollution. AI data center waste heat reuse benefits local communities by lowering heating bills for homes, public buildings, and businesses when recovered heat is ...

  • Blog Entry

    Data Center Post Summary As the number of data centers grows, so do concerns about location, power access, and grid capacity, especially as AI and cloud computing drive surging electricity demand. Yet, data centers hold an unexpected solution: the waste heat they generate can be harnessed for community benefit. Captured through district energy systems, this heat can be transformed into a valuable community resource that provides low-carbon warmth, improves grid stability, and redefines data centers as energy partners. The Power Behind the Numbers In 2023, data centers accounted for roughly 4.4% of total U.S. electricity use, a share projected to rise to as much as 12% by 2028 . As utilities and developers scramble to expand clean generation and transmission, waste heat reuse offers an immediate, scalable way to reduce carbon intensity and ease grid stress. How Heat Reuse Works Servers generate heat, which can be captured and directed into district energy networks—insulated pipes transporting hot or chilled water—supplying heat to nearby buildings. This approach reduces the electricity needed for heating and cooling, improving overall efficiency and cutting emissions. In essence, the data center becomes part of a shared local energy ecosystem. Some add combined heat and power (CHP) systems that produce electricity and heat simultaneously. CHP can increase efficiency for large or urban centers. Two deployment models stand out: Urban data centers (10–20 ...

  • newswise Summary In response to the societal challenge of growing electricity demand from AI data centers, Oak Ridge National Laboratory (ORNL) is launching the Next Generation Data Centers Institute (NGDCI). This internal ORNL institute will unite the laboratory’s unique expertise and facilities that span energy technologies, high-performance computing, cybersecurity, and grid science to ensure that America’s rapidly growing AI infrastructure remains secure, efficient, and reliable. Data centers account for more than 4% of U.S. electricity use , and by 2030, that figure could climb as high as 17%, according to analysis by the Electric Power Research Institute . AI -specific workloads drive much of this growth: Training a single large language model can consume hundreds of megawatt-hours of electricity. The North American Electric Reliability Corporation warns that surging demand from AI and industrial electrification poses mounting risks to grid reliability. Continue Reading #News

  • Renewable Energy World Summary Data center demand is surging due to the growth of artificial intelligence (AI) and cloud computing, and developers are under pressure to find reliable, resilient, and cost-efficient power sources. Microgrids are rising to meet this challenge. These localized energy resources can operate independently of the main grid and help data center owners and operators to meet their power generation needs. But achieving optimal results from microgrids requires planning for the right mix and configuration of technologies such as renewables, storage, gensets, and thermal assets. The right mix and sizing of these energy generation and storage technologies is critical, and developers should also plan beyond simply powering their data centers. Cooling the infrastructure that runs these servers is equally critical and, based on past project performance, has proven to be a major factor in operational costs and energy use as well. Continue Reading #News #DataCenter #CHP

  • One Arabia Summary The UAE Ministry of Energy and Infrastructure, Khazna Data Centers, Agility and Phaidra are launching a pilot that uses artificial intelligence to cut energy use in data centers and district cooling systems across the UAE. The initiative supports the UAE Net Zero 2050 Strategy and national AI ambitions, targeting lower power consumption and stronger performance in large-scale digital infrastructure. Under that framework, the partners aim to extend AI-enabled optimisation beyond the initial pilot into wider UAE infrastructure, including district cooling operations. The Ministry intends to align any scaled deployments with the UAE Energy Efficiency Strategy, while reinforcing the country’s position as a regional and global location for AI-driven digital infrastructure investment. Continue Reading #News #DistrictCooling