Circular Economy

Your data could warm you up this winter, here’s how

A data centre.

Hot tech ... the data centre heating market could be worth $2.5 billion by 2025. Image: Unsplash/Kvistholt

Stephen Hall
Writer, Forum Agenda
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  • Tech companies are using the data centres that house their vast servers to heat homes and cut CO2.
  • The data-centre heating market could be worth $2.5 billion by 2025, according to recent forecasts from the International Data Corporation.
  • Data-generated heating could slash energy bills for consumers as more companies and governments opt to use it.

Between 2018 and 2020, more digital information was created than in all of human history pre-2018. Much of this was stored in huge, energy intensive data centres, according to the International Data Corporation.

The heat created by these servers can be used to warm homes, making them more sustainable and providing an alternative fuel for houses and offices.

Now, several companies and governments have started using data centres in this way.

Making use of data centre heat

In Sweden, an initiative called Stockholm Data Parks runs in partnership with political and industry leaders to warm people's homes using waste heat generated by the city’s data centres.

At a time when the war in Ukraine and the price of gas has left many consumers fearful of approaching winter, the possibilities of the scheme look promising.

The largest data centres produce over 100MW of energy, which is enough to power 80,000 homes, according to the think tank Energy Innovation. Stockholm Data Park’s current goal is to meet 10% of the entire heating needs of Stockholm by 2035.

In the Netherlands, a company called Switch Datacenters has mitigated reliance on natural gas by replacing its gas generator units with data-centre heating. Through this system, 97% of the server heat can be delivered to homes and offices, according to CEO Gregor Snip.

Diagram showing the principle of recycling waste heat from the data centres.
The excess heat created by data centres can be used to warm homes. Image: Fortum

The system works by using direct liquid cooling (DLC) to transfer heat away from servers. The excess heated water from this process is then sent to homes.

“We believe data centres (with DLC) will help cities in the very near future to achieve their CO2 neutral goals in a sustainable way,” says Snip.

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A financial boost

Beyond meeting sustainability targets, there are serious financial incentives for companies that choose to make use of their data centres in this way.

Market researchers Global Market Insights predict that the data-centre DLC market will be worth over $2.5 billion by 2025, up from $750 million in 2018.

While companies profit, customers receive cheaper energy. Switch Datacenters reports that consumers choosing DLC cooling receive a cash incentive equivalent to 20%-30% of their electricity costs.

Tech giant gets onboard

Microsoft is the latest big business to make use of this system. It has partnered with the Finnish company Fortum to heat thousands of homes in Helsinki. Fortum currently serves 250,000 customers and it says, once completed, 40% of these homes can be heated by DLC.

Microsoft’s two new data centres in Helsinki will also be powered by renewable energy. The project is expected to cut around 400,000 tonnes of CO2 emissions annually.

Data-centre heating systems can also provide a boost to local economies. According to a recent IDC study, over the next four years, the Microsoft ecosystem could produce €17.2 billion in new revenue and will add more than 11,000 skilled IT jobs in Finland.

Sanna Marin, Prime Minister of Finland, praised the intention to “accelerate Finland’s digital growth while making our energy system greener". She said: "The collaboration can serve as a model to other countries and cities looking to achieve the double transformation of climate neutrality and digital competitiveness.”

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Circular EconomyEnergy Transition
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