Can power hungry data centres keep up with AI’s demands?

In short, companies that were influenced by competitive urgency and rushed into AI, now face decisions regarding cost and sustainability of the technology.  

Here, data centre experts share their predictions for 2025.

Balancing AI growth and sustainability

Mark Fenton, Product Engineering Director at Cadence believes that, in 2025, data centres will face mounting pressure to reconcile AI’s surging energy requirements with strict sustainability goals, sparking an industry-wide rethink on AI applications. The infrastructure required to deliver on AI is poised to drive a 160% increase in data centre power demand. This challenge is creating a pivotal moment for data centres to support high-density compute loads while advancing their environmental commitments.

Companies will face a new crossroads. Many that initially rushed into AI, driven by competitive urgency, will now reevaluate its financial and energy impact, with some in-house setups costing up to $300,000 in hardware alone. This shift is likely to push organisations toward selective, high-value AI applications that provide stronger operational returns, including within data centres themselves. However, demand will still remain at a high level, stretching capacity to its limits. As such, tools like digital twins will be essential for data centres to meet AI goals sustainably, allowing operators to proactively manage power, integrate renewable sources, and optimise cooling measures to meet AI’s GPU usage demands. With these advancements, data centres can help organisations make AI investments both impactful and environmentally responsible.

EU’s 2025 energy efficiency directive will prompt data centre accountability 

Fenton also believes that the EU Energy Efficiency Directive's new reporting requirements, starting in May 2025, will mark a significant step in measuring energy and water usage within the data centre industry on a wide scale. By establishing initial data points, the directive will enable an ongoing comparison of industry performance, potentially paving the way for new regulations or targets that promote greater energy efficiency. The results will likely reveal a diverse landscape, where some companies, particularly within tech, show measurable progress, while others lag behind, exposing varying levels of commitment to environmental goals.

What's more, with public interest in data centres’ resource use on the rise, these findings could invite heightened scrutiny, especially if data points to excessive energy consumption or local grid strain. This may lead to ‘naming and shaming’ by the media, heightening societal pushback even further.

However, the EU’s transparency-driven approach and heightened scrutiny should encourage data centres to adopt greener practices and utilise tools like digital twins, both to meet compliance standards and mitigate public backlash. Ideally, this will set a new benchmark for sustainability and accountability across the sector.

Data centres AI era revamp 

David King, Senior Principal Product Engineer, Cadence thinks that data centres will face a pivotal moment next year as energy usage, especially to power AI, continues to rise. Facilities will start to realise that there really isn’t enough energy. While newly built, AI-optimised facilities can be better suited to handle these requirements, retrofitting older data centres to support increased power as well as cooling is required to meet demands. However, it is costly and complex. This pressure is prompting operators to plan both infrastructure upgrades and invest in purpose-built facilities designed to power AI.

Amid these changes, digital twins will be crucial for enhancing data centre efficiency and sustainability in both new and existing data centres. By simulating physical facility environments, digital twins allow operators to optimise power distribution, improve cooling techniques, and test energy changes, helping to maximise resource use and reduce stranded capacity. This technology not only makes the most out of existing space, it also supports sustainable growth, setting a new standard for energy-efficient, AI-capable data centres.

Gen Z’s purposeful mindset will help close the skills gap

King also feels that, from 2025 onwards, the data centre industry will see a substantial generational shift as seasoned professionals retire and younger, tech-savvy talent bring in specialised skills in AI, automation and sustainability.

Traditionally focused on physical infrastructure, data centre roles are evolving to require advanced technical skills like proficiency with simulation software such as digital twins. These tools are crucial in modern data centres for optimising energy use, airflow, and resource allocation, marking a proactive shift toward efficiency and sustainability.