Data Centres and Surplus Heat — From Waste Product to Resource
Data centres produce enormous amounts of heat as they cool their servers. That heat could supply district heating to thousands of households — but only if the collaboration and the business model are in place.
A growing surplus of heat
Denmark is currently attracting major data centres. Tech giants and cloud providers are investing billions in facilities that run around the clock, processing the data our digital lives depend on. But all that computing power has a side effect: heat. A great deal of heat.
To keep the servers running, data centres must be cooled constantly. And the heat removed from the server rooms typically ends up being released into the open air. This is essentially waste of a valuable resource — because that heat could instead be used to heat homes, institutions, and businesses via the district heating network.
The potential is enormous — but it does not happen by itself
On paper, this sounds like a perfect solution: data centres get rid of their surplus heat, and district heating companies gain an inexpensive, green heat source. But the reality is more nuanced.
First, the temperature must match. The surplus heat from a data centre is often lower than the temperature required by the district heating network. This means the heat must be upgraded using heat pumps, which costs money and energy. The question is whether the equation still makes sense once those costs are factored in.
Second, there is the question of incentives. A data centre exists to deliver IT services — not heat. For collaboration with a local heat utility to be attractive, the data centre must see a concrete saving, or alternatively some other upside, such as an improved carbon footprint. Examples include lower cooling costs, or greater supply security in the cooling process.
Collaboration is the key word
This is precisely where things get interesting. When a district heating company and a data centre sit down together and design a shared solution, both parties can win. The data centre can reduce its cooling costs, and the district heating company gains access to a stable heat source that can supplement or replace other production facilities.
But this requires the parties to understand each other’s business. The data centre thinks in terms of uptime, redundancy, and SLAs. The district heating company thinks in terms of supply security, peak load, and long-term investments. Building a bridge between these two worlds requires time, trust, and a willingness to find solutions that work for both.
The business case must hold — for both parties
The decisive question is always: does it make financial sense? Or at the very least: can we avoid losing money?
For surplus heat from data centres to become a genuine part of district heating supply, the business case must hold water on both sides of the table. This requires realistic calculations, clear agreements on price and delivery, and a shared understanding of risks.
Experience shows that the best projects are those where the parties come together early in the process to explore the possibilities — not with a ready-made solution on the table, but with an openness to finding the right model together.
Surplus heat from data centres is not a silver bullet. But with the right collaboration and the right business model, it can become an important piece of the future green district heating supply.