Clifford Chance

This briefing examines some of the legal considerations arising from the relationship between the energy transition and digital transformation in these contexts.

The data centre industry is poised for growth in 2023 due to increased demand from businesses. However, factors such as higher costs, a slowing economy, new capacity challenges and increased regulation due to sustainability concerns about energy and water consumption, will impact growth. The pandemic has fueled the growth of the global data centre market, projected to reach 235 billion euros by 2026 with a projected Compound Annual Growth Rate of 4.5%. Companies must consider the latest tech trends when selecting a data centre partner or colocation provider.

Energy security and affordability have become a major issue for many countries. Rising inflation, increasingly frequent and significant climate events, and an uncertain geopolitical and economic outlook provide a challenging backdrop for governments committed to net zero targets and keen to accelerate the development of low-carbon energy. We highlight some trends which focus on some of the innovations and legal developments that we are seeing in a number of sectors to meet these challenges.

With spiralling energy costs, warnings of supply shortages, growing concerns about water resources and an increasing focus on sustainable lending, we look at what is next for data center financings. Technology has transformed the way we live and dramatically increased the volume of data being stored. As a result, data centers, as an asset class, have risen in value. However, the cost of energy and the water usage needed to run them, are increasingly coming under the spotlight. It is estimated that data centers account for approximately 2% of the total U.S. electricity use and these facilities' energy use is expected to increase as demand rises. With spiralling energy costs, warnings of supply shortages, growing concerns about water resources and an increasing focus on sustainable lending, we look at what is next for data center financings.

Technology has transformed the way we live and dramatically increased the volume of data being stored. As a result, data centres, as an asset class, have risen in value. However, the cost of energy and the water usage needed to run them, are increasingly coming under the spotlight. It is estimated that data centres will account for over 3 per cent. of electricity demand in the EU by 2030 if development continues on the current trajectory. With spiralling energy costs, warnings of supply shortages, growing concerns about water resources and an increasing focus on sustainable lending, we look at what is next for data centre financings.

Partner Nadia Kalic explores the concept of Smart Cities.