By aggregating the thermal needs of multiple buildings, district energy systems create economies of scale that enable investment in highly-efficient, industrial-scale or renewable assets that may not make economic sense for an individual building.
District Energy Technology for Data Centers
Q&A with Rob Thornton, President & CEO | International District Energy Association (IDEA)
Can you tell me about your role and the International District Energy Association?
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I serve as President and CEO of the International District Energy Association (IDEA). IDEA is a 501 c (6) non-profit trade association formed in 1909, now in our 116th year. We have about 3000 members in over 20 countries, with the majority in North America. I have been in the district energy industry since 1987 and have been in this role at IDEA since 2000. The district energy industry has really evolved over the past 40 years, and the pace of change is accelerating, but it is hard to believe I have been at the helm of IDEA for 25 years!
My primary role is advocate for the district energy industry. While I have fiduciary responsibility for the business side of IDEA, my work involves informing and educating people on the economic and environmental attributes of district energy systems. For example, I have briefed a former President of the United States, members of his Cabinet, Senate and House leadership and committee staff and agency or department heads at US DOE, US EPA, Commerce as well as dozens of state, provincial and local leaders. We monitor and comment on policies, legislation and regulations at federal, provincial, state and local levels, which has also escalated in recent years. There is an international aspect that has allowed me to meet with and learn from members of the German Bundestag, South Korean parliament, ministers of energy and environment in Denmark, Finland, Dubai, Abu Dhabi, Qatar, Saudi Arabia and Beijing, among others. Closer to home, IDEA members own, operate, design, build and optimize world-class district energy systems for cities, communities and campuses. Our conferences bring together thousands of industry participants every year, and we curate relevant information and share through a range of platforms, including our quarterly magazine, “District Energy” that has been published continuously since 1915.
How does district energy technology work and what can it do for data centers?
District energy, in its simplest form, involves a central plant or plants that produce, capture or recover thermal energy as steam, hot water and chilled water which is then distributed to connected customer buildings through an underground piping network for heating, cooling and air-conditioning or processes. A “district” can be the central business district of a city, or a large mixed-use development, college or university campus, airport, hospital, military base or even a research or industrial campus for a pharmaceutical or tech corporation. Systems range in size from a small cluster of a few buildings to thousands of buildings virtually covering entire cities.
By aggregating the thermal needs of multiple buildings, district energy systems create economies of scale that enable investment in highly-efficient, industrial-scale or renewable assets that may not make economic sense for an individual building. By allowing building owner/operators to eliminate the capital investment and equipment needed for heating and air conditioning, it can free up valuable rooftop or usable space for tenant amenities or revenue generation.
A primary advantage of having a district energy system in a city or campus, is that modernizing the central plant can accelerate the energy transition or decarbonization for hundreds of connected buildings on the network, instead of the risk and pace of converting one single building at a time. And because of scale and diversity, district energy systems can utilize a range of technologies, including recovery of surplus heat from a data center.
In simple terms, the electricity used internally by servers in a data center is also converted into heat in the process. When data centers are connected to district energy systems, that surplus process heat generated by the center’s servers and is captured and converted into useful thermal energy, rather than simply being exhausted into the local environment through cooling towers. Surplus heat can be used to make hot water and warm buildings connected to the district energy system, essentially displacing downstream carbon emissions from production of thermal energy. Think of it as energy recycling. District energy systems are better suited to manage, optimize, store and distribute useful thermal energy to multiple buildings. Data center operators want to focus on their core business, so district energy operators are a great potential partner.
Co-location of data centers with district energy has been pretty common across Scandinavia and northern Europe in recent years. Most district heating systems in Europe distribute hot water, which makes it a little bit easier to leverage and directly utilize large volumes of lower-grade heat produced by data centers. Here in North America, many existing downtown district heating systems distribute steam, and data center heat output can be used to pre-heat water before conversion to steam or integrated with a large heat pump. In general, the heat from a data center needs some form of temperature boost for use in buildings or process, but every BTU saved in the process also saves money and emissions.
Can you highlight some of the work that IDEA members are doing to recover waste heat from data centers? Are any members helping to cool data centers?
There are several IDEA members connected to and serving data centers. In Toronto, for instance, there's a large retail data center right downtown that gets its cooling from Enwave. Enwave is a fully integrated district energy services provider which uses a deep lake water cooling (DLWC) system connected to Lake Ontario that provides district chilled water to cool about 120 buildings in the downtown core. Not only does this data center utilize low carbon electricity, but cooling is provided by renewable cooling from Enwave's DLWC system. It has been recognized globally for its remarkable efficiency, reliability, resilience and low carbon footprint.
Additionally, in Markham, Ontario, just northeast of downtown Toronto, the city of Markham owns and operates a highly successful district heating and cooling system. Markham District Energy has been harvesting heat and providing district cooling to a 25,000 SF third-party data center contiguous to their primary central plant for about a decade. District energy service is recognized for its reliability, resilience and consistency. And Markham is currently taking it one step further by tapping into a main sewer line that runs through their compound to create zero-carbon heating and cooling to expand district heating and cooling service for one of the fastest-growing communities in Ontario.
What is the implementation process like to connect a district energy system to a data center?
District energy and data centers can be a bit of “chicken or the egg”. Looking at Europe, the district energy systems were already in place first and the data centers came to them. For instance, there were large district energy systems in cities like Helsinki or Stockholm where the data centers aimed to locate near them to dissipate surplus heat or connect to low carbon cooling services.
Here in North America, we are in the early stages of a similar process, where the data center developers are looking at locations and while there a mutual advantages to co-locating a data center near to a district energy system to connect to robust cooling service or recover surplus heat, the data center industry is primarily focused on building large scale infrastructure and “lighting it up” as quickly and efficiently as possible. It would be stretching the truth to say that thermal energy utilization is shaping the market. But at IDEA, our members invest and own thermal energy infrastructure as long-life durable assets and we are very interested in understanding better how to structure mutually-beneficial partnering or off-take arrangements to leverage surplus heat in our communities.
Proliferation of data centers is impacting the full energy spectrum in North America from electricity grids to natural gas pipelines to municipal water supplies and land use considerations. It is a five-level chessboard right now to manage the myriad challenges of planning, implementing and managing energy and water resources. Utilities, municipalities, agencies and regulators are working hard to comprehend the shifting landscape and risks/rewards of the acceleration of the digital economy.
IDEA is hosting our 116th Annual Conference in Minneapolis June 2-5 and part of the program is a full day workshop on “District Energy & Data Centers”. In addition to multiple technology providers, a large global data center developer/owner/operator will share their “Heat Export” program along with a representative of a regional planning agency with hundreds of data centers in a cluster will come together to discuss topics like:
- How much heat is generated per MW of electricity consumed in a data center?
- What are the electricity, water and cooling needs of a 200 MW data center?
- How do retail data centers differ from hyper-scalers (1 GW)?
- How should utilities, developers, agencies and regulators think about growth?
- Can a remote hyperscale data center generate sufficient surplus energy to justify investment in a district energy network to bloom incremental economic activity nearby like housing, greenhouses or process industries?
I think the district energy industry can be a useful partner in this process, as we are good at aggregating, integrating and innovating around thermal energy. Our members have experience designing, building and optimizing thermal networks. It remains to be seen how much value can be generated by syncing up data centers with district energy, but this moment feels like an important opportunity. The appetite for more digital services seems voracious. Data centers require consistent and firm energy, all the time, so this is an exciting time for district energy to be a part of the conversation.
How can district energy help meet the rapidly growing power demand of data centers?
A district energy network can recover and re-use heat that would have otherwise been exhausted into the local environment, making it useful as thermal energy for nearby buildings. For example, the Amazon headquarters in downtown Seattle is a cluster of four buildings totalling nearly 4 million square feet of space that has been heated by surplus heat from a nearby data center for nearly a decade. This opportunity isn’t really a technology problem as it is a business model challenge. It can be done technically, but a successful project will require participation of multiple stakeholders working through a range of contractual issues.
Is there anything else you’d like to highlight about the relationship between district energy and data centers?
It’s evident that many parties in the economy are interested in mitigating the environmental impacts from expanding the digital economy. Many data center operators have intentionally sourced clean or renewable electricity to power their server banks and data centers, sometimes at a substantial premium. It stands to reason that if the electricity that's going into the servers is renewable, then the heat coming out of the other end of the data center is also renewable.
At IDEA, we tend to think that recovered heat has value irrespective of the primary source, but it’s worth exploring policy considerations to help incentivize heat recovery from data centers to support investment in district energy networks. Right now, data centers are very much driven by speed to market but IDEA is eager to expand the conversation with the data center industry, utilities and regulators to explore how district energy can be a fulcrum for the future we design today.
The content & opinions in this article are the author’s and do not necessarily represent the views of AltEnergyMag
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