A circular economy in the data centre industry

Jack Bedell-Pearce
9 May, 22

The urgency to incorporate sustainability within a business model has resulted in rapid changes that have impacted all parts of the data centre sector. Being prepared for a more sustainable future is a growing priority for decision-makers, and preserving resources has become a necessity for the future of the planet.

With reports stating the carbon footprint of our devices, the internet and equipment that supports them accounts for about 3.7% of global greenhouse emissions, the data centre industry must do its part to support a circular economy where resources are reused and recycled as much as possible to reduce waste and consumption.

Data centres also have a role to play in helping other industries move towards a circular economy, since reducing energy consumption will pave the way for energy companies to move away from fossil fuels and move to renewables, another essential element of an overall circular economy.

Regarded as being the backbone of digital society, data centres (which store the majority of servers and network equipment that make up the internet) use a huge amount of energy. So making sure they run in an optimally power efficient way is key – especially given how much data is being stored and processed on a daily basis.

Why a circular economy is important for data centres

People across the world are absorbing data like never before. This trend is being driven by the IoT (Internet of Things) and personal devices, such as smartphones, tablets, electric vehicles and health monitors, which are likely to reach more than 40 billion during this decade.

The data centre industry is also a primary force linking digital transformation and global energy consumption. According to the EIA Annual Energy Outlook 2020, 205 terawatt hours were consumed by data centres in 2019. There has been a 26-fold increase in data storage capacity, an 11-fold rise in data centre IP traffic and 30% increase in computer server usage. There is no future that doesn’t include data centres and the only way to build towards a sustainable future is for the industry to adopt a circular economy.

Today’s economy is linear; companies dig up materials, transform them into a product and ship it to an end user who throws it away at the end of its life cycle. This way of working is no longer sustainable, and we now need companies to recycle and reuse the majority of critical raw materials (CRM) in order to protect the environment as well as helping to reduce costs.

According to the Ellen MacArthur Foundation, a circular economy is based on three principles: to design out waste and pollution, keep products and materials in use and regenerate natural materials. It is designed to benefit businesses, society and the environment.

Working together for a sustainable future

Companies big and small are already working hard to integrate a circular economy into the data centre industry. This can include finding ways to upgrade legacy facilities and not construct an entirely new building, which would emit additional C02 emissions and require construction materials.

The transformation to a circular economy won’t happen overnight, but with little changes it can have a big impact on how products are used and recycled, without any waste.

An example of this in action is at Microsoft. As the cloud continues to grow worldwide, the tech giant wanted to better manage its end-of-life assets and push towards long-term sustainability. Microsoft’s Circular Centres programme now achieves 83% reuse and a 17% recycle rate of critical parts, while contributing to the reduction of carbon emissions by 145,000 metric tons C02 equivalent.

Additionally, Google wrote a blog post in 2018 which stated that at the time, the global demand for resources was roughly 1.7 times what the Earth can support in one year. It added that the linear economy model is soon going to reach the end of its physical limits, so began working with the Ellen MacArthur Foundation to get as much out of every element in its data centres.

An initiative in the UK is the London City Bank University Project. Known as CEBACI (Circular Economy for the Data Centre Industry), it aims to make data centre equipment more sustainable. According to the project, only 10% CRM from the sector are currently recycled and recovered.

The impact of new cooling technologies is not to be overlooked either. Many data centres are already using adiabatic, water-based cooling towers which can be recycled and reused.

Adiabatic cooling is one of the simplest ways to cool down a data centre as it reduces costs and helps the environment. Unlike conventional cooling systems, the concept doesn’t require an energy-intensive compressor to achieve cooling. The only power needed is for the water pumps and the fan that assists evaporation, which is where the cooling comes from. Since these systems use water, they also eliminate the need for any chemical coolants.

Next steps

There is no one-size-fits-all approach to making net zero data centres a reality. Achieving key sustainability goals requires a holistic approach, with a strategy defined by C-suite executives. There needs to be full transparency in the data centre lifecycles as part of their social responsibility, which can incorporate concepts of SustainInfra and SustainTech.

One example is techUK’s Climate Change Agreement (CCA). It sets energy efficiency targets that are sector-specific, so they can be focused exactly where they deliver the most benefit. For data centres, the targets take the form of a reduction in Power Usage Effectiveness (PUE) because it is well understood and measurable. The scheme runs until 2023, giving companies a set date to work on making a difference to their operations.


The need for the data centre sector to move to a circular economy model is evident, but the potential for success is great. According to analysis from Accenture, the financial upside of implementing circular business practices could reach as high as $4.5 trillion by 2030.

Making big changes which will transform how critical parts are recycled and used is going to take time, but it’s clear to see that companies and projects are already making great strides towards making a circular economy in the data centre sector a reality.

A timeline is in place for the industry to start making small steps, and with the results above demonstrating that it is already on a positive path, the next decade will be the real test to how the sector survives and thrives in the future.  

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