Onsite Energy Plans for New Data Center Projects Reflect Industry's Decarbonization Investment

Aug. 23, 2023
Planned projects combining data centers and on-site energy reflect an ongoing trend of data center investment moving to meet global green imperatives for decarbonization and sustainability via use of clean energy technologies.

Announcements this month for projects combining data centers and on-site energy, including one in Virginia with plans for a transition to small modular reactor (SMR) nuclear and hydrogen generation and one in West Virginia featuring hydrogen power derived from natural gas, illustrate an ongoing trend of data center investment moving to meet global green imperatives for decarbonization and sustainability via the use of clean energy technologies.

Clean energy investment toward development platforms targeting the hyperscale sector is a trend reported on earlier this year by DCF Editor at Large Rich Miller, who noted in his January story about Houston-based clean energy proponent CleanArc Data Centers that the market is currently at "a moment when data centers and energy companies are forging deeper connections, as both industries wrestle with the growing specter of climate change and cloud computing's appetite for renewable energy to support massive MegaCampuses that can exceed 500 megawatts."

DCF also discussed this topic in our 2022 and 2023 trend forecasts, predicting that "the intersection of data center energy will enter a new phase, driven by demand for renewably-powered data centers and the deep pockets of global investors." In 2022, DCF forecast that data and energy would forge deeper connections. That has certainly proven to be true, but this year's forecast narrowed our lens of expectation to anticipate more data center projects that include on-site energy generation to enable expansion in grid-constrained markets.

A notable example of this trend is in Ireland, where Microsoft in July received approval to build a massive 170-megawatt gas-fired power plant, in addition to 21 backup diesel generators, to provide power for its Dublin data center campus. The gas plant will be able to fully support the campus in the event of disconnection from the country's crowded national grid, run by EirGrid, who had previously capped power hookups for new data center construction in the Dublin market. (DCF also reported last year that Microsoft data centers will begin sharing energy from their UPS battery storage systems with Ireland’s power grid, as part of a growing movement for data centers to collaborate more closely with the utility industry.)

In our annual trend forecast, DCF also predicted that similar on-site strategies could emerge in Northern Virginia’s Loudoun County, where new power hookups from Dominion Energy will be severely limited until 2026 due to constraints in the local high-capacity power transmission network.

At a Loudoun Chamber of Commerce event on August 8, as reported by LoudonNow, Virginia Secretary of Commerce and Trade Caren Merrick said the state is meeting regularly with Dominion and other providers on the topic of small modular reactors, investigating a concept for smaller-scale nuclear reactors capable of generating up to 300MW, produced in assembly line fashion, producing less power than today’s large-scale nuclear energy facilities, but being built more quickly and cheaply, and requiring much less land.

“Many, many companies have been reaching out to us here in Virginia because of our nuclear energy, because companies want to know that they're going to have the energy that they need to grow,” said Merrick. “And it's not only data centers—it’s agriculture, it’s manufacturing. We need to have energy more than we do.”

SMR Nuclear to Hydrogen On-Site Power Generation Plan Proceeds In Surry County, Virginia

Confirming DCF's prediction of more on-site generation by data centers in the region, Green Energy Partners LLC of Virginia (GEP) this month announced that it has taken another step toward cementing plans to construct a data center and energy campus near the regional Surry Nuclear Power Plant, by taking up a partnership with Virginia-based international nuclear power developer IP3 Corporation.

The companies' joint establishment of the Surry Green Energy Center, LLC (SGEC) to pursue clean, green energy projects is also the main vehicle for the partners to implement commercial plans targeting baseload and industrial energy needs in Virginia. Initially announced in April, the project has its sights on construction of up to 30 data centers, ultimately supported by on-site power generation from SMR and hydrogen systems.

IP3 is a Virginia-based developer and integrator of nuclear energy programs in coordination with its fully owned subsidiary, Allied Nuclear Partners (ANP). The company further bills itself as delivering a “buy-side” approach for private enterprises and host nations to pursue planning, development, financing, and operations of projects deploying clean energy technologies. A second subsidiary company, IP3 Security, provides physical and cyber security expertise.

In April, DCF reported that GEP, the developer of the Stonewall Energy Park located roughly 180 mi. to the north in Loudoun County, was under contract to purchase 641 acres adjacent to the existing 1.6 GW Surry Nuclear Power Station to create a new data center and renewable energy production center.

GEP's legacy as a Virginia property and project development company passionate about generating sustainable carbon-free energy began in 1975 with its development of 20 acres in Fairfax County that became the Spring Park Technology Center. Successive acquisitions and developments have included over 11,000 acres in Virginia, creating more than 15,000 residential and industrial lots, along with thousands of jobs.

The company's sustainability journey led to its securing the 641 acres in Surry County and launching plans to create the fully integrated SGEC industrial park, one of the nation's first such green energy centers, to be built near the existing nuclear power plant's two 800MW reactors with on-site SMRs to follow. The ultimate plan calls for the huge data center campus to also feature hydrogen power generation.

Bill Puckett, GEP's vice-president of strategic development, noted in DCF's April reporting by David Chernicoff that the company plans to build 20 to 30 individual data centers on 3- to 5-acre plots, with construction set to begin within 18 months, presuming that all permitting can be completed in that timeframe. The initial plan calls for running the data centers on existing power sources, then, using the revenue from the data centers, to build out to a hydrogen production facility and a fleet of 4-6 SMRs powering the data centers, generating the hydrogen fuel, and providing backup power for Virginia’s grid, whereby the SGEC will expand Virginia’s data center capacity and offset escalating power demands.

By its strategic location in Surry County, the joint IP3-GEP project aims to supply digital infrastructure and future power supply services to government agencies and military bases across the Washington, DC area, to the environs of Norfolk, Virginia. The SGEC project may also create more than 3,000 jobs in the Surry area.

“As we look to build on our dominance in energy-intensive industries like data centers and advanced computing and increase our leadership in emerging fields like advanced manufacturing, ag-tech, and biopharmaceuticals, we know that our grid must deliver power, 24 hours a day, 7 days a week, 365 days a year, and it must deliver that power at a competitive price,” said Virginia Governor Glenn Youngkin, as quoted in the Virginia Energy Plan.

“The governor has put a stake in the ground and he said, ‘my moon shot is within 10 years, we're going to have a small modular reactor in Virginia,’” noted Virginia Secretary of Commerce and Trade Merrick in LoudonNow's reporting as cited above. “That's not going to be just one. We need more than one. We are talking to companies that want their own modular reactor, as you say, so that they can have certainty. And again, if we want to compete to win, if we want energy not only for data centers, but for schools and hospitals, we need to be serious about making those investments.”

The IP3-GEP collaborative relationship will seek to lead the transition for energy generation options in the region. IP3 said it will provide project development, financial structuring, and funding solutions in a phased approach for the project. The joint agreement addresses inception, development, financing, and operations that will attract private capital and "cutting-edge energy companies" to Virginia, said the partners.

“The Commonwealth of Virginia has developed a purposeful plan for their energy future,” observed Michael Hewitt, co-founder and CEO of IP3. "They are ready to harness the smart energy transition to create jobs for Americans and set an example for developing clean industrial zones. Infrastructure investment needs to be radically reoriented," added Hewitt. "The combined expertise of GEP and IP3 will access private capital markets to help Virginia’s energy sector become a model for an era of American energy sovereignty.”

Of the project's plan for on-site hydrogen generation, as explained by DCF's Chernicoff in his April reporting on the development:

"Once the SMRs are deployed the facilities would be expanded to include a green energy hub, a location where hydrogen fuel is created. The Green Energy Center would use heat from the SMRs to bring pressurized water to 800 degrees, then using an electrolyzer to split the water into its component oxygen and hydrogen molecules, with the hydrogen being available for use as fuel that was created carbon-free (green hydrogen). This hydrogen fuel would potentially used on site or sold to customers to whom it would be blended with existing natural gas and shipped via pipelines already on site."

Chernicoff's article noted further:

"For the SMRs, GEP is working with the Idaho National Laboratory which has a commercial SMR project ongoing [in the NuScale SMR Simulation Lab], currently scheduled to go online in 2029. Discussions are in process with SMR vendors, as well as the expected data center builders and potential customers. Quoted in Virginia Business, Puckett says that prospective customers and investors are already banging on their door. The same article also quotes Puckett as saying that depending on the SMR vendor selected, the power plants could start coming online in as little as five years. That's an aggressive timeline which would likely make these SMRs the first commercially deployed in the US, and potentially, worldwide."

Still just a plan

While using hydrogen fuel for data center back up power is a technology that is being well-explored on a large scale by hyperscale and colocation industry leaders including Microsoft and Equinix, and from a modular standpoint by hydrogen-power innovators such as ECL, the IP3-GEP joint venture only ascends to hydrogen power generation after establishing the SMR plant in adequate numbers - an outcome which is unfortunately not, at this point, a foregone conclusion. Somewhat disquietingly, IP3 CEO Hewitt's recent comments to The Register appear to hedge a bit on the project's ideals.

As quoted by The Register's reporting on the GEP-IP3 plan, Hewitt told the publication, "We're going to create a data center park first, and that data center park will get power from the local utility, and we will build lots, and we will sell those lots to data center providers. We see that as a very lucrative investment, particularly when you look at the going rate for a data center lot in, say, Northern Virginia." Further, Hewitt told The Register, "Let's say that the nuclear power part of it kind of falls apart in terms of an opportunity; we still have a data center site that makes money and has a great client."

But if the plans for power generation via the nation's first SMR plant don't pan out in Surry County, there's at least another chance across the state in Southwest Virginia for the technology to take hold. NBC TV affiliate WCYB News 5 reported on Aug. 21 that the LENOWISCO Planning District Commission, serving the counties of Lee, Wise, Scott and the City of Norton, recently conducted a feasibility study which concluded that the area could be a suitable fit to house an SMR to provide nuclear power within a decade.

Natural Gas to Hydrogen Plan Emerges for On-Site Data Center Power Generation In West Virginia

If on-site hydrogen power generation, as electrolyzed and furnished by a nearby SMR plant, represents a future-based endgame for the IP3-GEP data center plans in Virginia, it's the main event in Fidelis New Energy, LLC's announcement of its selection of Mason County, West Virginia as the location of its first net-zero carbon hydrogen production facility, which plans to also power an on-site cloud data center campus up to 1GW.

Headquartered in Houston, Texas with offices in Baton Rouge, Louisiana and Copenhagen, Denmark, self-described energy transition company Fidelis says it's driving the global impetus toward decarbonization through its investments in renewable fuels, low or negative carbon-intensity products, and carbon capture and storage technologies in the U.S. and Europe. The company claims to utilize an "all of the above" energy philosophy, with a focus on reducing carbon intensity through the integration of both proven and innovative technologies.

The Fidelis suite of patent-pending energy transition technologies is designed to assist in the decarbonization of hard-to-abate industries. At the center of the technology offering is the FidelisH2 hydrogen production pathway, which enables lifecycle carbon neutral hydrogen to be produced from natural gas and renewable energy sources.

The full Fidelis suite of energy transition technologies also includes the H2PowerCool and CO2PowerGrow systems. H2PowerCool utilizes FidelisH2 hydrogen as a net-zero energy source to power and cool data centers, enabling the operation of carbon-neutral data centers that can be hosted on-site at the Mountaineer facility, sans utilization of off-site indirect carbon offsets or credits.

According to a Fidelis statement, the Mountaineer site will be implementing the proprietary FidelisH2 technology, which taken as a whole enables production of hydrogen with zero lifecycle carbon emissions through a combination of means including natural gas, but also renewable energy and carbon capture, utilization, and sequestration (CCUS).

The lifecycle carbon-neutral hydrogen production facility and low carbon microgrid described by the Mountaineer GigaSystem and its associated Monarch Cloud Campus of data centers powered by net zero hydrogen, plans to leverage the FidelisH2 technologies for a data center campus powered and cooled by clean hydrogen, plus a greenhouse system utilizing waste heat and captured CO2 for purposes of low-cost, high-impact food production.

Drawn from a July 2023 blog by Vertiv, the following description of microgrid technology offers a good table-setting reminder regarding these systems:

"Generally, a microgrid is a set of distributed energy systems (DES) operating dependently or independently of a larger utility grid, providing flexible local power to improve reliability while leveraging renewable energy. The system can be configured to prioritize renewables, such as solar, wind, and hydrogen fuel cells, switching to fossil power only when the situation requires it, making the technology more cost-effective. Excess electricity generated from renewable sources can be stored for use during periods of high demand, generally in battery energy storage systems (BESS) utilizing lithium-ion batteries. As the microgrid is independent, there is an immediate efficiency gain because utility transmission losses are avoided. Some utilities are even deploying microgrids as a solution to grid constraints helping to balance the load on the larger electrical grid and reduce strain on existing infrastructure."

The compelling case for data center microgrids was also made by a webinar series this February from DCF and Endeavor Business Media sibling Microgrid Knowledge, outlining how microgrids can help data center operators improve their electric resilience, lower energy costs and achieve sustainability goals.

As noted by DCF, the Fidelis plan for natural gas on-site power generation leveraging a microgrid follows on a path blazed last year by Microsoft in its plan to integrate a microgrid while using biofuel for backup power at its data center in San Jose, California, which will employ renewable natural gas (RNG) instead of diesel fuel to power its emergency backup generators, in a project with microgrid provider Enchanted Rock which advances Microsoft’s goal of moving off of diesel fuel by 2030.

Among other hyperscale stalwarts, DCF noted in May that several of Amazon's new data centers in Oregon will be supported by on-site power generation from fuel cells running on natural gas. AWS described that decision as a short-term strategy to support customers in its US-West region until its renewable energy agreement ramps up, enabling larger procurements of wind and solar power. Such on-site power generation plans for the PNW region may be timely, as indicated by local reporting this week that Washington state's Chelan PUD has upwardly adjusted its power rate class for not just cryptocurrency, but also data center operations.

The natural gas-to-hydrogen aspect of the Fidelis planning for on-site data center power generation in West Virginia appears to be that project's differentiator. The FidelisH2 technologies will be used by data centers at the Monarch Cloud Campus on land secured by Fidelis within the Mountaineer site and additional acreage within Mason County. When fully built out, the company said the project's data center capacity could reach 1,000 MW, representing over $5 billion in additional investment.

The company said that waste heat and a portion of the captured CO2 from FidelisH2 production and waste heat from the hyperscale data centers would be used as inputs to co-located greenhouses to decarbonize and lower the cost of food production. As one of two "high impact industrial business districts" in West Virginia based on Code 5B 2-21, Fidelis said the project as planned consists of four phases, with each phase producing over 500 metric tons per day (MTPD) of net-zero carbon hydrogen at an approximate capital cost of $2 billion per phase, excluding associated investments in data centers, greenhouses, etc.

The first FidelisH2 phase of the Mountaineer GigaSystem is expected to commence operations in 2028. The net zero carbon hydrogen produced will be used for a variety of purposes beyond carbon neutral hyperscale data centers and greenhouses to include transportation and steel production. Fidelis and West Virginia have finalized the operating agreement, which also determines the terms for the targeted storage capacity and the pore space agreement establishing exclusive rights for carbon capture and sequestration (CCS) in certain areas.

An incentive package from the West Virginia Department of Economic Development enables Mountaineer to conduct additional geologic evaluation for CCS, as required for the permits needed to conduct CCS activities. The company said these activities will serve as the foundation for the clean hydrogen and CCS industries in the state, providing a source of jobs and generating state revenue for CO2 volumes stored safely and permanently underground.

Fidelis notes it has a demonstrated history within the CCUS space, with experience in partnering and developing carbon storage assets on the U.S. Gulf Coast and in Europe. When all four phases of the Mountaineer GigaSystem are operational, the company estimaes that approximately 10 million metric tons per year of CO2 would be permanently stored, providing over $100 million in annual revenue to West Virginia or ~$25 million per phase each year.

Further, Fidelis is a Project Development Partner through Mountaineer in the Appalachian Regional Clean Hydrogen Hub (ARCH2,) a regional hub which brings together private industry, state and local government, academic and technology institutions, NGOs, and communities across the Northern Appalachian region. As reckoned by Fidelis, ARCH2 seeks to develop "an interconnected, full value chain H2Hub solution" in support of the U.S. Department of Energy's vision of a national clean hydrogen network.

State and federal incentives, net zero extension technologies bolster project's economic effects

Fidelis emphasized that projects such as the Mountaineer development, and the economic impact they will afford to host states such as West Virginia, would not be possible without the energy security and transition incentives passed by Congress in the Inflation Reduction Act. The company noted that these provisions, including the Section 45V Production Tax Credit and 45Q Carbon Capture Tax Credits, ensure the economic viability of projects that both increase national energy security and incentivize energy transition.

West Virginia Governor Jim Justice commented, "I am beyond excited that West Virginia will be the home of the Mountaineer GigaSystem and Monarch Cloud Campus. West Virginia has a long history as an energy powerhouse for our nation, thanks to our hardworking people who know how to get the job done. And now, we're in a great position to make the most of a new fuel – hydrogen – through this incredible project in Mason County. There's simply no doubt that Fidelis is going to help shape the future of West Virginia in a major, major way by assisting in the commercial lift-off of some truly exciting new industries."

John Musgrave, Executive Director of the Mason County Development Authority, added, "The citizens of Mason County are elated with the announcement of Fidelis New Energy selecting Mason County, West Virginia, for its multibillion-dollar state of the art carbon neutral, clean hydrogen complex. The selection of the Mason County site is the result of a team effort with national, state, and county teams working together to bring this outstanding international company to West Virginia. The project's four-phase construction plan will not only provide substantial employment opportunities for the local workforce, with 800 full-time jobs and 4,200 construction workers, but it will also have a major positive impact on the region's economy. The influx of workers and the establishment of the facility will bring additional business, industry, and new technology to Mason County, the state, and the surrounding region. This excludes the employment in data centers and greenhouses."

In conjunction with the broader project unveiling, Fidelis also announced a letter of intent with Babcock & Wilcox (B&W) to support the evaluation, development, and delivery of that company's BrightLoop hydrogen and chemical looping platform at the Mountaineer site. This move targets a full build out of four 200 MTPD of net-zero hydrogen production facilities. The BrightLoop technology enables the production of hydrogen from waste biomass including fallen trees, sawmill waste, and other solid fuels, as well as natural gas combined with CCUS, making it "a highly synergistic addition" to the Mountaineer GigaSystem site, as reckoned by Fidelis.

Bengt Jarlsjo, President and Chief Operating Officer at Fidelis, and one of the company's co-founders, commented, "By combining several proven technologies from leading providers including our FidelisH2 partners Topsoe and Babcock & Wilcox, we are able to produce lifecycle carbon-free clean hydrogen at scale without taking new technology risk. Our proprietary net-zero solutions using only proven technologies are attracting significant commercial interest from hydrogen users, data center operators, and greenhouse owners. This helps the ARCH2 hub to achieve scale across the hydrogen lifecycle from production through consumption."

 "We are proud to have selected West Virginia as home to the Mountaineer GigaSystem where it can serve as a major anchor and support for the broader ARCH2 Hydrogen Hub," added Pete Hollis, Senior Vice President and Global Head of CCUS for Fidelis. "The state's position at the forefront of energy and chemical production in the United States make it a natural choice for a project such as ours."

In comments thanking the plan's key stateside supporters, Dan Shapiro, CEO and co-founder of Fidelis, stated, "Fidelis is extremely appreciative of committed West Virginian and Fidelis Advisory Board member, Major General James 'Jim' Hoyer, who passionately advocated for us to implement our FidelisH2 hydrogen technology in the Mountain State and introduced us to many of the people who have collaborated with us to make this announcement possible. We would like to express our gratitude to Governor Jim Justice and his administration, including Director Mike Graney, Secretary Mitch Carmichael, the West Virginia Economic Development Authority, and Mason County Economic Development for recognizing the value the Mountaineer GigaSystem and the Monarch Cloud Campus bring to West Virginia. West Virginia has made great strides in positioning itself as a global leader in CCUS by leveraging its geology and passing laws that make West Virginia competitive with other states. We are grateful to Governor Justice as well as Speaker of the House of Delegates Roger Hanshaw and Senate President Craig Blair for their roles in positioning West Virginia as a leader in the growing CCUS industry through the laws enacted in the prior regular legislative session regarding CCUS."

Given the importance of the federal incentives to the project and the ARCH2 Hydrogen Hub, Fidelis' Shapiro noted in conclusion, "This project and many other hydrogen projects, including those within ARCH2, would not be possible without the leadership from Senator Joe Manchin for the energy security and energy transition incentives passed in the Inflation Reduction Act. Support from Senators Shelley Moore Capito and Joe Manchin for the bipartisan Infrastructure Investment and Jobs Act was crucial for enabling the hydrogen hubs, and we laud their continued efforts to streamline the permitting process for critical infrastructure projects across the United States."

Deep Currents of Investment Feed Data Centers' Decarbonization, Sustainability Goals

As seen in the projects in Virginia and West Virginia, the spectrum of data center industry investment toward meeting global impetus for decarbonization is broad (and national). As a sounding of its depth, as noted by Rich Miller's January reporting on CleanArc Data Centers, specialized investors such as Quantum Energy Partners and its clean energy platform, 547 Energy, are exemplars who have taken a lead in furthering such investments. Further evidence of the deep currents of investment headed toward meeting the data center industry's sustainability and decarbonization goals comes in a pair recent announcements from data center investment rivals DigitalBridge and Blackstone.

In May, DigitalBridge announced a new decarbonization partnership with Climate Adaptive Infrastructure (CAI) to deploy up to $300 million in capital for accelerating the digital infrastructure transition to net zero, with an initial investment focused on Switch as a leading operator of renewable-powered data centers acquired by DigitalBridge last year.

As an infrastructure investment firm specializing in low-carbon real assets in the energy, water and urban infrastructure sectors, CAI said it is partnering with DigitalBridge to identify, develop and invest in sustainability-focused initiatives and projects that complement DigitalBridge’s existing and future investments. As part of the partnership, CAI has allocated up to $300 million of capital to support strategic opportunities identified by both partners.

CAI’s first investment under the new initiative is in the DigitalBridge-managed investment entity Switch, an operator known for its 100% renewable powered data center platform. In addition, the parties said they have identified other potential investment opportunities within the DigitalBridge portfolio that address measurable decarbonization and water and energy resilience.

Founded in 2019 as a thought leader in the climate-adaptive infrastructure industry, CAI said it will work with DigitalBridge to implement technologies from within and beyond the DigitalBridge portfolio. The firm said this will include deployment of utility-scale solar and wind, low-impact hydro, electrochemical and pumped storage, water conservation and re-use, renewable biodiesel and green hydrogen, as well as advanced climate impact measurement strategies developed by CAI. These projects, which may be financed, built, owned and operated by CAI, are expected to support DigitalBridge’s Net Zero 2030 commitment, and to drive economic efficiency across the DigitalBridge digital ecosystem.

“The DigitalBridge team is broadly recognized for their success in the sector and, through this initiative, continues to demonstrate forward thinking around further decarbonizing their ecosystem,” said Bill Green, Managing Partner of CAI. “We are excited to be launching this innovative partnership with DigitalBridge.”

“We are pleased to partner with Bill and the entire CAI team to accelerate DigitalBridge’s path towards a more sustainable digital infrastructure ecosystem,” added Marc Ganzi, CEO of DigitalBridge. (The DigitalBridge CEO was also seen in separate reporting this month by Data Center Dynamics to forecast Generative AI as a 38GW data center opportunity. Where and how the data center industry's concurrent Generative AI and Net Zero impetuses may intersect in the future is an open question.)

Meanwhile, DigitalBridge competitor Blackstone's blockbuster 2021 investment into data center REIT QTS Realty Trust has also been seen recently to pay off in terms of meeting industry sustainability and decarbonization goals.

On this matter, as fully noted by July reporting from Financial Times / FT.com:

"As well as returning money to Breit investors, Blackstone [...] has committed to spend more than $8 billion to build new data centres for several large-scale technology companies, according to two sources familiar with the matter, and spent more than $1 billion in recent years to buy land to build new centres in five states across the US. In mid-2021 it also acquired QTS Realty Trust, a real estate trust focused on data centres. QTS’s valuation has soared to about $20 billion since Blackstone bought it, according to sources familiar with the matter — double what the asset manager paid."

As crucially noted by DCD, Blackstone's reported $8 billion spend on data centers build through QTS came hand-in-hand with the investor's prediction of a surge in AI workloads.

Nearly concurrently in July, QTS published its annual sustainability report, where the enterprise, hyperscale and government data center provider stated its ongoing "commitment to environmental, social and governance responsibility and expanded goal to procure 100% of its power from carbon-free energy sources." 

Available online here, QTS Data Centers' 2022 Sustainability Report highlights the company's commitment to its Environmental, Social and Governance (ESG) program. As recounted by a QTS press release:

2022 was a transformative year of growth for QTS. During the year, the company signed the highest level of new megawatt leasing in its history and commissioned more power for customers than the prior three years combined. In alignment with its carbon reduction commitment to the U.S. Department of Energy's Better Climate Challenge, QTS remains focused on carbon-free energy procurement.

The aim is to source as much of its energy needs as possible from renewable power, while exploring alternative fuel sources and methods of power generation and actively partnering with our customers and partners on their respective ESG initiatives.

QTS has implemented innovative solutions, such as utilizing heat output from its data centers to supply district heating to nearby communities, thereby enhancing its power usage efficiency. Through QTS' standardized Freedom data center design, it has also eliminated the use of water in the operation of its data centers, thereby preserving a critical resource for local communities.

Based on its progress and success in 2022, QTS said it has updated its ESG goals with the following stipulations:

  • Procure 100% of its power from carbon-free energy sources – QTS aims to source 100% of electrical power from sources with no direct greenhouse gas emissions, with the intention to source the maximum amount of renewable power possible subject to cost and supply constraints.
  • Portfolio wide annual WUE reduction of 5% - QTS features a minimal water-cooling design that continues to generate year-over-year efficiency gains in its Water Usage Effectiveness (WUE) metric, the most relevant metric for measuring water use and conservation in the data center industry.
  • Voluntary Reporting - Per GRESB, CDP, EcoVadis, RE100 and the EPA Green Power Partnership.
  • Design 100% of buildings to Green Building Standards, while pursuing ENERGY STAR certification for all eligible properties – QTS said it is shifting to meet the needs of its growing footprint and continues to design to green building standards, including ENERGY STAR and LEED.
  • Install EV charging stations at 75% of facilities by 2025 - As of the end of 2021, QTS reports it accomplished this goal; but that with a growing company footprint, it chose to add electric vehicle charging stations to all of its new sites in order to stay on track with this goal.
  • Recycle 90% of Operational Waste by 2025 - As of the end of 2022, QTS reports it has recycled over 1.7 billion pounds of material and recycled 78% of its operational waste. Sources of waste included in operational waste are trash and recycling from on-site receptacles, cardboard, paper, and scrap materials from development activities.

The company's July press release describes the full scope of QTS' ESG activities, as reflected in its 2022 Sustainability Report.

"As QTS' footprint expands, we remain committed to the stewardship of our employees, customers, partners and local communities," commented Chad Williams, CEO of QTS. "Through innovation and a commitment to serve a purpose higher than self, we look forward to maintaining our industry leadership in customer service, employee engagement and environmental sustainability."

About the Author

Matt Vincent

A B2B technology journalist and editor with more than two decades of experience, Matt Vincent is Editor in Chief of Data Center Frontier.

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