The European Commission is currently holding a public consultation on a Draft Delegated Act (“DDA”) on a common rating scheme on the energy performance of data centers in the European Union and European Economic Area (“EU/EEA”). The DDA will lay out the energy key performance indicators that operators and owners of data centers must report, the sustainability indicators that will be calculated per data center, and the aggregated data that will be made publicly available, in accordance with the new EU Energy Efficiency Directive (“EED”).
The adoption of the DDA will introduce specific mandatory environmental and energy performance reporting requirements for data centers for the first time in the EU/EEA, and probably in the world. These reporting requirements may be the first step for the EU to adopt mandatory environmental performance targets for data centers within the next decade.
The Energy Efficiency Directive’s Reporting Obligations for Data Centers
For the first time, the EED imposes environmental and energy performance reporting obligations on data centers in the EU/EEA. It obliges Member States to require owners and operators of data centers with a power demand of the installed information technology of at least 500kW to report, by May 15, 2024, and every year thereafter:
- contact details of the data center, its operator and owner;
- floor area, installed power, annual incoming and outgoing traffic, and amount of data stored and processed within the data center; and
- key performance indicators during the last calendar year, including energy consumption, power utilization, temperature set points, waste heat utilization, water usage and use of renewable energy.
The EED also requires the Commission to establish a European database on data centers with the information publicly available on an aggregated basis.
The Draft Delegated Act
The DDA is intended to specify the energy and environmental performance reporting obligations that the EED imposes. It clarifies the reporting obligations and details the environmental and energy key performance indicators that data centers must report, the sustainability indicators that must be calculated, and the data that must be made publicly available.
- Reporting Obligations: The DDA suggests that operators and owners of data centers will have to report their key performance indicators to the European database of data centers, which the Commission must create. They will be able to do so through a common user interface to ensure that all data centers can report the information in the same way.
The DDA also confirms that the key performance indicators for reporting will be those of the “calendar year immediately preceding the reporting year,” and, where a data center has been in operation for less than a year, it must report only for the time it has been in operation.
Article 3(5) of the DDA also provides specific reporting rules for operators of co-location and co-hosting data centers. It requires their operators to “gather, publish and communicate” to the European database the information and key performance indicators covering all their co-location, and co-hosting customers at the co-location and co-hosting data centers they manage by May 15, 2026. If they cannot gather all the information, they must indicate the percentage of the data center computer room floor area covered by the reported information.
- Key Performance Indicators to Report: Annexes I and II to the DDA list the information that operators and owners of data centers will have to report. Annex I details the general information that must be reported, including name of the data center, its operator and owner; contact details; location; type of data center (e.g., enterprise, co-location, co-hosting); electrical infrastructure redundancy level; and total number of racks.
Annex II details the environmental and energy key performance indicators that operators of data centers will have to report. Among other information, it lists installed information technology power demand; computer room floor area; total energy consumption; total energy consumption of information technology equipment; average battery capacity; total water input; total potable water input; waste heat reused; average waste heat temperature; type of refrigerants used for cooling; rating cooling capacity; total renewable energy consumption; total renewable energy consumption from on-site renewables; ICT capacity for servers; ICT capacity for storage equipment; incoming traffic bandwidth, outgoing traffic bandwidth; incoming data traffic; and outgoing data traffic.
Annex II also establishes the methodologies to calculate the different key performance indicators that must be reported. While many of these methodologies are largely based on standard CEN/CENELEC EN 50600-4 Information Technology – Data Center Facilities and Infrastructures, they are not exactly the same and in some cases there are significant differences.
- Sustainability Indicators: Annex III to the DDA lists the sustainability indicators that must be calculated per data center on the basis of the key performance indicators. Presumably these indicators will be calculated per data center by the European database that the Commission must create. It lists power usage effectiveness; water usage effectiveness; energy reuse factor; and renewable energy factor. Annex III also establishes the formula to calculate these indicators.
Many of the key performance indicators and sustainability indicators listed in the Annexes to DDA are also referenced in the Commission’s Green Government Procurement Criteria for Data Centers and in the EU Code of Conduct on Data Center Energy Efficiency, which is also mentioned as a technical screening criteria for data centers in the Climate Delegated Act for purposes of the Taxonomy Regulation. However, the methodologies and formula used to calculate them are not always the same.
- Data that Must Be Made Publicly Available. Annex IV makes clear that the European database must only make data publicly available at an aggregated level, both at Member State and EU level and per data center size category. Among the aggregated data that must be disclosed, Annex IV lists the number of data centers; distribution per size category; average power usage effectiveness; average water usage effectiveness; average energy reuse factor; and average renewable energy factor.
Interested parties may comment on the DDA until January 8, 2024. After that, the European Commission is expected to try to quickly adopt the Delegated Act to be able to meet the May 15, 2024, reporting deadline, notwithstanding that the Delegated Act will have to go through the required scrutiny period with the Parliament and Council. If the DDA and the EED are interpreted as already requiring data centers to report by May 15, 2024, in accordance with the detailed reporting elements of the DDA, this could constitute a significant challenge for operators and owners of data centers.
The reporting requirements of the EED and the DDA are likely to be the first step for the EU to adopt mandatory environmental targets on data centers. Article 12 of the EED requires the Commission to assess the information reported by data centers and to submit a report to the European Parliament and Council by May 15, 2025. Such report must be accompanied, “where appropriate, by legislative proposals containing further measures to improve energy efficiency, including establishing minimum performance standards and an assessment on the feasibility of transition towards a net-zero emission data centers sector, in close contact with the relevant stakeholders. Such proposals may establish a timeframe within which existing data centers are to be required to meet minimum performance.”
In effect, the EED already requires Member States to “encourage” owners and operators of data centers with a power demand of the installed information technology equal or greater than 1MW to take into account the best practices of the European Code on Data Center Energy Efficiency. The German Energy Efficiency Act (“EnEfG”) already imposes mandatory energy efficiency and sustainability requirements on data centers with a non-redundant nominal power connection capacity of 300 kW or more.