A European legislative proposal would make it easier to offset data center emissions. Is the EU shifting up a gear, or is geopolitical reality simply prevailing over climate policy?
Climate policy regarding data centers was reportedly one of the topics of discussion during a meeting of European member states last Thursday. A legislative proposal is on the table to relax the rules for data centers. This has not yet been made public by the European Union, but the Financial Times was able to view a draft.
The fact that this theme is being raised while Europe groans under heat records illustrates the balancing act the European Union finds itself in. Europe wants to appear more prominently on the global AI stage, and data centers are needed for that. But the major tech players can no longer hide the fact that AI is causing their power bills to skyrocket.
Cheaper offsets
The legislative proposal aims to make it cheaper for data center operators to offset their emissions. Such ‘carbon credits’ are not new and are earned by investing in green energy projects elsewhere. The European Union is considering relaxing rules for data centers to reduce costs. Nuclear energy would now also be seen as a valid offset.
An earlier proposal published by the Commission in March is thus immediately being rolled back. The draft law included a rating system to assess data centers on sustainability based on color codes. Big tech companies such as Microsoft and AWS, which are investing heavily in data centers in Europe, actively lobbied, supported by the European industry association EUDCA. The open door to nuclear energy is intended to reassure member states that want to utilize it, such as France. That seems to be paying off.
The proposal that the Financial Times was able to view is far from final. Energy experts would also be involved in fleshing it out. Climate offsets have both proponents and opponents. While it can be a means for companies to support sustainable and social projects, opponents see it more as a way for companies to clear their conscience instead of effectively addressing their emissions.
Conflicting interests
The question remains how high climate still ranks on the European agenda. Geopolitics and technological (in)dependence have gained a higher sense of urgency. In this regard, the European Union is in a tricky position. This was made painfully clear by the (temporary) export ban imposed on Anthropic: if the US decides on access to technology, Europe risks being left empty-handed.
Fortunately, the Trump administration may have quickly changed its mind, but the European Union is seeking independence and relevance on the global AI stage. Data centers and the technological innovation they support are necessary for that. Regulation, which the European Union has long considered its hobbyhorse, is suddenly becoming a burden. The climate must then also yield for a moment.
At the same time, the consequences of climate change can no longer be ignored in Europe. In recent weeks, Europe groaned under a heatwave that hit almost the entire continent and broke heat records. Southern Europe is literally ablaze. Choosing to favor data centers that require a lot of energy and water may be difficult for public opinion to swallow.
Power consumption peaks
Recent figures from cloud giants Amazon and Google map out the energy consumption by data centers. Google reports a 37 percent increase in energy consumption for the year 2025: the sharpest increase in a single calendar year. Since 2019, power consumption has more than tripled. Amazon’s sustainability report shows 34 percent more emissions from purchased energy.
Not all figures are bad: Google managed to limit its operational emissions by purchasing more green energy. Yet it seems increasingly difficult for cloud giants to reconcile sustainability goals with investments in AI, which are reaching hundreds of billions of dollars and are not slowing down.
Industry experts believe those figures should be put into perspective. Data center operators want to get rid of their bad reputation for being ‘energy guzzlers,’ as was discussed extensively during a roundtable organized by ITdaily earlier this year. The experts pointed out that data centers invest heavily in green energy and offer a much more sustainable alternative for heavy workloads than if every company were to cram its basement full of servers.
Creative solutions
In any case, the sector cannot be blamed for not looking for solutions. A virtually entirely new market is emerging for battery technology tailored to data centers, reports the Financial Times. These must better absorb power peaks caused by AI training and inference than traditional computing infrastructure. At those peak moments, AI workloads can generate dozens of megawatts in less than a second.
Power grids starting to hit their capacity is another problem that data centers worldwide are beginning to feel. In Flanders, data centers should not count on any favors. A proposed decree would even put data centers at the back of the queue for grid connection, so as not to jeopardize the power supply for households.
The sector is not exactly pleased with that proposal. Friso Haringsma, CEO of Datacenter United, expressed his dissatisfaction in a LinkedIn post. “We want to become a leader in Europe in AI, cloud, digitalization, and digital sovereignty. We expect companies, governments, hospitals, banks, telecom operators, and even utilities to digitalize further. But we are putting the infrastructure on which all those services run at the back of the queue.”
Thus, governments must weigh their options. Investments in data centers will be necessary to support digitalization in Europe. At the same time, climate needs are higher than ever. It is up to the data center sector to demonstrate that a choice for technological independence can also be a choice for the climate.
We want to become a leader in AI, but we are putting the infrastructure at the back of the queue.
Friso Haringsma, CEO Datacenter United (via LinkedIn)