The Energy Efficiency Directive introduced an obligation for the monitoring and reporting of the energy performance of data centres.[9] The Delegated Regulation on the establishment of a common Union rating scheme for data centres (EU/2024/1364) sets out the information and key performance indicators for the reporting obligation.[9] Guidance documents include a reporter guide and frequently asked questions and guidance, which explain the required reporting of cooling-related indicators such as waste heat utilisation and water usage.[9]

The cornerstone of the European Union’s current energy efficiency framework is the Energy Efficiency Directive (Directive (EU) 2023/1791, hereinafter ‘EED’), which entered into force in October 2023.[5] Article 12 of the EED thus requires Member States to ensure that data centers with a power demand of the installed information technology of at least 500 kilowatts (kW) monitor and report key performance indicators, including energy consumption, power utilization, temperature set points, waste heat utilization, water usage and use of renewable energy.[5] However, the Directive itself does not establish binding minimum efficiency requirements or technical performance standards for data centers, leaving specific efficiency measures to the discretion of the Member States.[5]

First adopted in 2012, the directive was updated in 2018 and 2023, setting rules and obligations for achieving the EU's ambitious energy efficiency targets.[3] The revised directive also requires EU countries to promote local heating and cooling plans in large municipalities having populations more than 45 000.[3] The definition of efficient district heating and cooling was modified in the revised directive to ensure it is fully decarbonised by 2050, with minimum requirements gradually changed to allow for progressive integration of renewable energy and waste heat and cold in the system.[3]

Bringing in a new obligation to monitor the energy performance of data centres, with an EU-level database collecting and publishing data.[2] The directive promotes local heating & cooling plans in larger municipalities, linking data centre energy performance to broader heating and cooling system planning and the use of waste heat.[2]

Datacenters with a total rated energy input exceeding 1MW must utilize the waste heat or other waste heat recovery applications unless they can show that it is not technically possible.[2] In that context, newly planned or substantially refurbished datacenters with a total rated energy input exceeding 1 MW must perform a cost-benefit analysis (CBA) that addresses technical feasibility, cost-efficiency and the impact on energy efficiency and local heat demand of utilizing waste heat to satisfy demand, and of the connection of the installation to a district heating network or an efficient/RES-based district cooling system or other waste heat recovery applications.[2] The CBA must consider cooling system solutions that allow removing or capturing the waste heat at useful temperature level with minimal ancillary energy inputs.[2]

In 2023, the European Union introduced the revised Energy Efficiency Directive (EED, EU/2023/1791) that requires data centers to report energy efficiency data to the European Commission.[6] Data centers must provide detailed information on their energy performance, which includes metrics that affect how cooling systems are designed and operated.[6]

Task Reports have been added since the release of the directive in September, and final reporting requirements were published and entered into force on the 10 of October 2023.[7] Data center owners and operators will be expected to report on metrics specified by the EED starting September 15, 2024.[7] This data includes energy consumption, PUE (Power Usage Effectiveness), temperature set points, waste heat utilization, water usage, and use of renewable energy.[7] Data centers with a total rated power exceeding 1 MW must utilize their waste heat for heating purposes or other energy recovery applications unless it is technically or economically unfeasible.[7] This includes optimizing cooling systems, using more efficient IT equipment, and adopting virtualization and server consolidation techniques.[7]

The European Union’s revised Energy Efficiency Directive went into effect on Oct. 10, 2023.[4] Included in it is a new “obligation for the monitoring and reporting of the energy performance of data centres.”[4] Once a database is established, the European Commission will collect and publish data regarding the energy and water use of data centers “with a significant energy consumption.”[4]

With the 2023 recast of the directive, the EU introduced mandatory, standardized, and public reporting requirements for large data centers covering both energy and water performance.[8] Under the Directive, covered data centers must report the following facility-level metrics by operators using a common EU template into "National Reporting Systems" and will ultimately be assessed for benchmarking and policy planning: total annual water withdrawal, water source, Water Usage Effectiveness (liters per kWh of IT energy), cooling system type and use of alternative water sources.[8] Operators must now demonstrate physical water metering at the facility level, defensible WUE calculations, and cooling design choices that stand up to regulatory scrutiny.[8]

The DDADUE Act stipulates that any operator of a data center with an installed capacity of ≥ 500 kW must submit a transparency report no later than May 15 of each year, covering data from the previous calendar year.[8] For facilities with a capacity exceeding 1 MW, the law now requires data center operators to recover waste heat and supply it to private or public facilities outside the site (connection to district heating networks, heating of adjacent buildings, etc.). This requirement is in addition to the transparency reporting obligation.[8] Under current regulations, this factor [Energy Reuse Factor] must be equal to or greater than 0.2 (20% of waste heat reused). This threshold may be gradually increased to 0.4 by simple ministerial decrees, depending on technological developments in the coming years.[8]

As data centers are projected to account for more than 3% of the European Union's total electricity demand by 2030, the EU is developing a sustainability rating scheme for data centers under the recently revised Energy Efficiency Directive.[1] Data centers with IT power demand of or greater than 500 kW must report annually the data on their energy performance and the key sustainability indicators Power Usage Effectiveness (PUE), Water Usage Effectiveness (WUE), Energy Reuse Factor (ERF) and Renewable Energy Factor (REF).[1] Data centers with IT power demand > 1 MW shall utilize the excess heat or other excess heat recovery applications where technically and economically feasible, and Member States shall ensure regional and local authorities develop local heating and cooling plans focused on enhancing energy efficiency via recovery of waste heat.[1]

Draft Delegated Act (DDA): A proposed supplement to the EED that mandates energy reporting for data centers with a power demand of at least 500kW by May 2024. It includes technical requirements like Power Usage Effectiveness (PUE) and limits on energy consumption for servers and cooling systems (Annex III). Article 6 of the Energy Efficiency Directive sets binding energy efficiency targets for large consumers, including data centers, while Article 8 mandates energy audits for large enterprises. The DDA would operationalise the EED’s data center transparency provisions by specifying indicators related to cooling efficiency and water use.

It raises the EU-wide 2030 energy efficiency target, aiming to curb the need for new power generation capacity, lower costs associated with energy, and reduce greenhouse gas emissions.[10] The Directive introduces new obligations for companies, including data centres, to monitor and report energy performance data, which may influence decisions on cooling technologies and energy management strategies.[10]

The EU Energy Efficiency Directive (EED) has fundamentally changed how data centers are regulated in Europe.[8] With the 2023 recast of the directive, the EU introduced mandatory, standardized, and public reporting requirements for large data centers covering both energy and water performance, including cooling system type and use of alternative water sources.[8] This is the first binding EU-wide framework that systematically captures how much water data centers use and how efficiently that water supports digital services, and sets a new global standard for ESG disclosure.[8]