The availability of power is a major bugbear for data centres, especially in the age of AI, but Juan Colina, EMEA data centre & IT segment leader at Eaton, thinks that collaboration and innovation around capacity, sustainability and regulation could solve the problem.

As we move further into 2025, data centres’ dominant role in the digital age only strengthens, supporting everything from artificial intelligence to cloud computing and big data analytics. However, increasing demand for these data-driven technologies, presents data centre operators with an evolving set of challenges, such as power availability, sustainability and transparency.

With these demands intensifying, data centre operators must urgently address grid capacity constraints. Success will depend on tackling power density, navigating regulatory compliance and delivering scalable growth. All of which will define high performance in the years ahead.

Grid capacity constraints demand innovative solutions

The surge in digital transformation across the globe has necessitated the demand for more data centre capacity. In Q1 of 2024, the European data centre market experienced nearly 20% year-over-year growth, which resulted in new distributed regional clusters and data centre designs to support the need for reduced latency and improved resilience.

But progress is being slowed by lengthy permitting processes and increasingly limited power availability in key regions. Operators are finding that power availability, including renewable energy sources, is becoming a critical factor influencing where and how facilities are built. Additionally, existing data centre upgrades (brownfield environments), which are required to handle load increases resulting from AI, will only exacerbate the power dilemma facing our industry.

To meet rising demand, operators must work more closely with governments and local jurisdictions to simplify permitting processes. Such efforts will help operators meet capacity needs without unnecessary delays. By proactively engaging with the wider ecosystem, operators can address power constraints and lay the groundwork for sustained growth.

Data centres as grid partners

Operators must also collaborate with utility providers to develop strategies that ensure power availability and the building of the critical infrastructure. Many data centre operators are already looking to add on-site renewable systems, such as solar, wind and hydrogen, over the next year. This will help to ensure uninterrupted operations, reduce dependence on external grids and minimise demand spikes for utilities.

As a result of the increasing adoption of renewable energy, we will continue to see new design best practices evolve to manage power more effectively and sustainably. For example, diesel gensets are being replaced by battery energy storage systems as short-term backup power supply. Energy storage systems, including advanced batteries, will become more critical as the data centre industry helps to support the grid in managing peak loads and stabilising energy usage.

Demand response programs, such as peak shaving, BESS, on-site renewable energy generation and load shifting enhance grid interactivity and should gain more traction, as they allow data centres to adjust their energy use during peak periods or even return surplus power to the grid. Such strategies will help data centres play an active role in stabilising the grid while maintaining reliable operations.

Power density needs will fuel technological advancements

By 2030, AI is expected to contribute to a 160% increase in power demand, accounting for 75% of all data centre energy usage. This surge requires operators to evaluate whether their existing data centre infrastructure is sufficiently equipped to deliver operational reliability, while also meeting sustainability requirements.

For example, operators must evaluate how to cater for the increased power densities required and incorporate more advanced cooling strategies. These include two-phase immersion and direct-to-chip cooling, which will become essential for managing heat, while delivering operational efficiency. 

At the same time, higher-voltage switchgear systems, such as SF6-free 36 kV configurations, should be introduced to support these growing power demands. Over the next year, close collaboration between operators and technology providers will be essential to ensure reliability and deployment speed are not sacrificed.

Staying ahead of regulatory changes

Regulations will introduce new challenges for operators. Whether it’s a response to the growing adoption of emerging technologies, such as AI and cross-border data transfer processes, or initiatives like the EU Green Deal and the Carbon Border Adjustment Mechanism (CBAM), regulations are demanding greater compliance, with more detailed carbon emission reporting and renewable energy integration. These changes mean operators will need to prioritise engagement with regulators, in order to adapt quickly to avoid falling behind.

Regionally, the picture varies widely. The Nordics, with their renewable energy and favourable policies, continue to attract investments, while stricter energy limits in countries like China require innovative approaches to stay compliant. Operators will need to stay ahead by working closely with regulators and adjusting their strategies based on regional demands.

The rise of modular data centres

Data centre operators are under pressure to quickly add capacity to meet the demand of advanced technologies. Modular and containerised data centres are a clear solution to add capacity and meet demand, as they can scale quickly, adapt to regional needs and reduce the need for on-site skilled labour.

By utilising pre-engineered modules, data centres can be rapidly deployed, significantly shortening the engineering time required for each site. This approach not only accelerates the deployment process but also ensures consistency and reliability across multiple locations. Moreover, operators can plan their growth strategies with confidence, knowing that each additional module will seamlessly integrate with the existing infrastructure as per the original design, delivering precise capacity increases.

Automation will fuel agility

Operators should look to implement automation to decentralise their networks, utilising predictive analytics and smart energy management tools to optimise performance while keeping costs in check. While the adoption of IT and operational technology data convergence has been slow, it will be a key strategy for all modern-day data centres.

Automation will bridge the gap between innovation and immediate operational demands, offering predictive analytics and adaptive controls to streamline density, cooling and energy efficiency requirements. As energy markets evolve and geopolitical trends like rising costs and shifting regulations add complexity, automated systems will empower operators to adapt dynamically. By aligning infrastructure design with intelligent management tools, operators can anticipate challenges, ensure resilience and support the sustainable growth of edge sites.

Managing the 2025 in-tray

2025 will be a critical period for the data centre industry. Tackling capacity issues, adapting to power density needs, managing energy volatility and meeting regulatory requirements will all demand focused, short-term action.

The future of data centres lies in collaboration, adaptability and innovation – essential components for success in an increasingly complex and competitive landscape. By embracing modular solutions, advanced cooling, renewable energy and proactive regulatory practices, operators can stay ahead of the curve.