- Global data centre electricity demand is projected to nearly double by 2030, largely driven by AI servers.
- Investment hit a record ~$61B in 2025, with the U.S. and China accounting for over 65% of activity.
- Grid capacity, cooling power, and rising water use are becoming binding constraints, triggering stricter permitting and local backlash.
- Scaling sustainably will hinge on efficiency gains and cleaner power, requiring coordinated action by operators and governments.
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The global data centre sector is entering an intensified phase of expansion, especially under the weight of surging AI demand. Gartner projects the industry’s electricity usage to nearly double—from 448 TWh in 2025 to 980 TWh by 2030—with AI-optimized servers alone rising from ~93 TWh to ~432 TWh over that period. This trajectory implies massive infrastructure investment pressures in power generation, grid capacity, cooling systems, and environmental footprints, particularly as the U.S. and China are responsible for more than two-thirds of that expansion.
Investment data confirms this boom: global data centre investment hit a record USD 61 billion in 2025, matching and slightly exceeding 2024, even amid concerns about speculative projects and overstatement of future power needs. Regionally, North America (especially the U.S.) leads in market share, followed by China, Western Europe, and emerging markets in Asia-Pacific and the Middle East, where incentives, localisation, and edge-computing demand are elevating interest.
However, growth is not unbounded. The sector faces significant environmental, regulatory and infrastructure challenges. Cooling and power efficiency remain weak spots: cooling systems alone account for roughly 38-40 % of energy use in data centres globally. Water usage is becoming a constraint: for example, in Texas, annual water consumption by data centres (both direct for cooling and indirect via power generation) could reach nearly 2.7 % of state usage by 2030; in 2025 they already used ~25 billion gallons. Regulatory friction is mounting—local moratoria, foreign ownership questions, and community lawsuits are growing [0news12][0news18][academic source].
The strategic implications are multifaceted. For industry players and investors: siting decisions, energy source contracts, water rights, and cooling tech R&D will increasingly determine who succeeds. For governments: planning for grid upgrades, tight regulation on efficiency and environmental mitigation, balanced permitting regimes, and coherence in data sovereignty laws are essential to collect benefits without generating backlash. Open questions include: What are realistic pathways to decarbonize this sector in line with climate goals? How can smaller and emerging markets attract data centre investment without becoming environmental sacrifice zones? How much regulation will be required before community resistance materially slows or redirects investment?
Supporting Notes
- In 2025, data centre global electricity consumption is estimated at 448 TWh, rising to 980 TWh by 2030 per Gartner forecast, with AI-optimized servers’ power rising nearly five-fold.
- AI-optimized servers will represent about 21 % of data centre power usage in 2025, rising to 44 % by 2030, and contributing ~64 % of incremental demand growth.
- Investment in data centres worldwide reached USD 61 billion in 2025, slightly above the USD 60.8 billion of 2024.
- United States and China contribute more than 65 % of data centre investment as of 2024; other regions like Western Europe, APAC, Middle East & Africa are active but lagging.
- Cooling systems account for roughly 38-40 % of data centre power consumption; computing/server resources ~40 %; power conditioning ~8-10 %; storage/communications ~5 %; lighting only ~1-2 %.
- Texas data centres used ~25 billion gallons of water in 2025; projected to consume ~161 billion gallons (~2.7 % of state usage) by 2030.
- In the U.S., data centres are estimated to have used over 4 % of total electricity in 2023, potentially rising to 6.7-12 % by 2030 depending on project realisation.
- Number of data centres by country (as of March 2025): U.S. ~5,426; Germany ~529; U.K. ~523; China ~449; others like Singapore ~99 and Netherlands ~298.
- Regulatory responses: Georgia introduced a moratorium through March 2027 on new data centre construction to allow policy catch-up; also, several U.S. towns have passed moratoria or rejected projects over environmental or zoning concerns [0news12][0news18].