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The future of data centres: how ESG data and analytics are revolutionizing sustainability IT

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By Alex Hong

· 25 min read


There is an urgent need for sustainability in many businesses, including information technology (IT), as a result of the global climate catastrophe. Understanding the effects of Environmental, Social, and Governance (ESG) data and analytics on data centre energy utilisation and how they are changing the technology trend of the future is crucial for anyone working in sustainable IT. In order to save energy costs and improve sustainability, this article will discuss the benefits and potential drawbacks of employing ESG data and analytics in data centres. We will also go over the rational initial actions data centres can take to meet their sustainability objectives.

Background on the growing demand for digital services

The foundation of the digital economy is the data centre, which can store and analyse a growing amount of data. The demand for data centre services has increased dramatically in recent years as a result of the expansion of digital services and data-driven technologies like artificial intelligence and the Internet of Things (IoT). According to a Frost & Sullivan analysis, the Asia-Pacific data centre colocation services market is anticipated to develop between 2019 and 2025 at an estimated compound annual growth rate of 16.4%.

Data centres account for about 0.9% of the world's energy-related greenhouse gas emissions, indicating that this increase in demand has had a substantial impact on energy usage. The energy usage of data centres in Singapore is thought to be 7% of the total national usage. Governments and leading business figures are reacting to this by focusing more on finding solutions to lessen data centres' negative environmental effects while still preserving the efficiency required to enable digital services.

Increased focus on the environmental impact of data centres

The need to cut energy use and improve sustainability has grown as the environmental impact of data centres has become increasingly obvious. The government of Singapore announced a "temporary pause" (2019-2022)on the construction of new data centres and published criteria for future projects to be more selective. With goals to attain carbon neutrality by 2030, existing data centres are also being urged to implement more environmentally friendly practises.

The cooling technology utilised in data centres is one important area of focus. Energy consumption can be significantly reduced by improving airflow and rearranging cooling systems. Utilising renewable energy sources, reclaiming water, recycling, and trash management are some other sustainable practises that are being introduced.

Emerging trend of using ESG data and analytics in data centres

With a greater understanding of how enterprises affect the environment and society, environmental, social, and governance (ESG) factors are becoming more significant for firms and investors. The data centre sector is also seeing the emergence of this trend, with businesses utilising ESG data and analytics to enhance sustainability and lessen environmental impact.

Advanced analytics are used in data centres, for instance, to monitor and optimise energy use, spot inefficiencies, and assess progress towards sustainability goals. In addition, businesses are collaborating with government agencies and sector organisations to share best practises and create uniform sustainability standards for the data centre sector.

The sustainability of data centres will be more crucial as long as there is a demand for digital services. In response, governments and business leaders are putting more emphasis on lowering energy consumption and improving sustainability, with a focus on the cooling technology used in data centres. While this is going on, the growing trend of using ESG data and analytics is assisting businesses in increasing sustainability and reducing environmental impact, which has the potential to significantly increase efficiency and sustainability in the data centre sector.

The advantages of using ESG data and analytics in data centres 

Data centres are increasingly being incorporated into our digital world as the demand for data processing and storage rises. The design, building, and operation of these facilities must, however, adhere to sustainable practises given the growing concern over climate change and the carbon footprint of data centres. It is at this point that environmental, social, and governance (ESG) data and analytics can significantly improve the effectiveness and sustainability of data centres.

Improved energy efficiency

Data centres' energy efficiency can be greatly increased by using ESG data and analytics. Operators of data centres can lower their energy expenses and usage while lowering their carbon impact by tracking energy use and identifying areas for optimisation. In Southeast Asia, data centre energy consumption is projected to increase between 2021 and 2025 at a compound annual growth rate of 13.7%, according to a report by Data Centre Dynamics. Operators of data centres can save up to 50% on energy by utilising ESG data and analytics.

Energy-efficient data centres must have effective cooling technology]. ESG data and analytics can reveal information on the effectiveness of cooling systems and point up areas for improvement. For instance, Fujitsu was able to reduce energy use in two of its Australian data centres by 48% by analysing environmental data gathered by wireless sensors. 

Reduced energy costs

Increased data centre energy efficiency can result in significant cost savings. For instance, the Singapore-based telecom Singtel was able to cover 10% of its energy requirements by installing solar panels in its Bedok data centre. With this solution, Singtel was able to save its energy expenditures while also promoting sustainability.

Regional data centre colocation services are anticipated to develop at a projected compound annual growth rate (CAGR) of 16.4% between 2019 and 2025, according to a Frost & Sullivan analysis. Finding strategies to lower this usage is essential because data centres' energy use significantly contributes to carbon emissions. Data centres can use ESG data and analytics to uncover operational inefficiencies and decide on effective energy-saving measures.

Enhanced sustainability performance

Operators of data centres can improve their performance in terms of sustainability by using ESG data and analytics. Operators can pinpoint problem areas and introduce more sustainable practises by monitoring indicators like carbon footprint, water use, and waste generation. By using only renewable energy, the Climate Neutral Data Centre Pact seeks to make data centres carbon-neutral by 2030. Operators of data centres can join the global effort to prevent climate change by aligning their sustainability aims with this treaty.

For data centres to be sustainable, renewable energy sources must be used. According to the Climate Neutral Data Centre Pact, by December 31, 2025, 75% of the electricity needed for data centres will be met by renewable energy or hourly carbon-free energy, and 100% by December 31, 2030. Data centres may examine their renewable energy alternatives and make well-informed decisions about their adoption with the use of ESG data and analytics.

Improved data centre operations

The use of ESG data and analytics can also enhance data centre performance. Operators can spot possible problems and improve operations by keeping an eye on important performance indicators like energy usage, temperature, and humidity levels. For instance, by enhancing airflow and rearranging computer room airconditioned (CRAC) units, Fujitsu was able to reduce energy use in two of its Australian data centres by 48%. 

Dr. Niladri Choudhuri, a leading author, speaker and evangelist for Site Reliability Engineering (SRE) and Devops, commented that it is important to start with design or redesign to make the data centres more efficient. We need to look at the location of data centres so that they can take advantage of the ecosystem and also help the ecosystem by using the heat to pass on to the community to heat the swimming pool or any other relevant usage. We also should not forget about the Scope 3 emissions in terms of using and negotiating longer warranties of servers and equipment, and have proper IT asset deposition (ITAD) process. Data is a big area of concern and data centres need to work together with the development and database administration (DBA) to ensure that only necessary data is there, while not compromising regulatory needs and need to go back in time when required.

Positive impact on corporate social responsibility

ESG data and analytics can improve corporate social responsibility when used in data centres. Data centre operators can contribute to a more sustainable future and show their commitment to CSR by implementing more sustainable practises and lowering their carbon footprint. Additionally, this can enhance the brand's reputation and perception among stakeholders and customers.

Using ESG data and analytics, then, can benefit data centres in the ASEAN market in a variety of ways, including better energy efficiency, lower energy costs, higher sustainability performance, better data centre operations, and a positive effect on corporate social responsibility. Data centre operators may create a more sustainable future for everyone by implementing more sustainable practises and making a contribution to international efforts to address climate change.

The potential challenges of using ESG data and analytics in data centres 

Understanding the potential difficulties associated with leveraging ESG data and analytics in data centres to increase efficiency is essential. The following are some potential difficulties that could emerge while integrating ESG data and analytics in ASEAN data centres:

Data collection and integration

Data from several sources must be gathered and integrated, which is a difficult and time-consuming procedure. It necessitates an enormous amount of resources and could lead to mistakes and inconsistencies. Data centres, on the other hand, can speed up this procedure and guarantee the integrity of the data collection and integration by utilising powerful analytics and automation tools. In the next three years, machine learning and AI, in the opinion of 75% of data centre managers polled by Vertiv, will increase data centre management effectiveness.

Lack of standardization

Standardising data collection and reporting is necessary for ESG data and analytics. There are no standardised procedures for gathering and reporting ESG data in ASEAN, nevertheless. This makes it difficult to assess performance and compare data across several data centres. Data centres can embrace sector standards like the Global Reporting Initiative (GRI) and the Task Force on Climate-related Financial Disclosures (TCFD) to address this issue. Standardisation will also help to understand trends across time and space creating greater understanding and cooperation in the region.

Data privacy and security concerns

ESG data and analytics call for the gathering and processing of private information, like energy usage and carbon emissions. To prevent data breaches and uphold data privacy, this data must be maintained securely. Strong security mechanisms and adherence to data protection laws like the General Data Protection Regulation (GDPR) or Personal Data Protection Act (PDPA – Singapore) be implemented by data centres to ensure data security.

Resistance to change

Data centres must significantly change how they function in order to implement ESG data and analytics. Those stakeholders and employees who are unfamiliar with ESG data and analytics may be resistant to this change. By offering its staff, stakeholders, and clients training and education, data centres may overcome this difficulty. Companies that invest in staff education and training have a 24% higher profit margin than those that do not, according to a survey by IDC.

Initial costs of implementation 

ESG data and analytics implementation in data centres necessitates an initial investment in tools, resources, and technology. Particularly for small and medium-sized data centres, this expenditure may be significant. Data centres can, however, recoup these expenses through reduced energy use and improved operational effectiveness. By implementing energy-efficient procedures, data centres can reduce their energy expenses by up to 40%, according to a paper from the Lawrence Berkeley National Laboratory. 

Logical first steps data centres should take to reduce energy costs and enhance sustainability 

Due to the sector's rising energy usage, the ASEAN region is working to make data centres more sustainable. With 60% of the region's data centre supplies concentrated in Singapore, the city-state is the region's data centre hub. Data centres must be decarbonized using renewable energy sources in order to attain sustainability.

In the APAC region, renewable energy use is not only popular and reasonably priced, but it is also a crucial element of energy-efficient data centres. Energy-efficient data centres also need to have effective cooling technologies. The monitoring and analysis of environmental data gathered by wireless sensors should also be done in a data centre using effective metering. The energy savings that cooling technologies can provide are excellent, but the future for toxic waste is less promising. In the US, e-waste makes up 70% of all toxic trash; there is little reason to think that the percentages are higher in the rest of the industrialised world.

South Korean regulations have caused the power usage effectiveness (PUE) of an asset to be decreased in order to reduce emissions costs. A thorough, comprehensive approach to the construction and operation of data centres that address cooling, energy use, and waste is required in order to produce truly green data centres that offer noticeable environmental advantages. Beyond economic growth, energy savings, and environmental benefits, building digitalization can have a significant impact on achieving ASEAN's ambitious 2025 target of a 32% reduction in energy intensity. This target is stated in the ASEAN Plan of Action for Energy Cooperation (APAEC) 2021–2025.

Conducting energy audits

Data centres play a crucial role in digitalisation, but their energy consumption can have a negative impact on the environment, with estimates suggesting that data centres account for up to 5% of global greenhouse gas emissions. With 60% of the ASEAN region's data centre supply located there, Singapore serves as a hub for the industry. To reduce the environmental impact of data centres, one way is to conduct energy audits.

For data centres to find areas where energy consumption can be optimised, energy audits are crucial. For example, an estimated 40% of a data centre's energy consumption can go toward cooling systems alone. By conducting an energy audit, data centres can identify unused servers and replace inefficient hardware, reducing overall energy consumption. In addition, an energy audit can highlight the potential for the use of renewable energy sources.

Singapore has implemented energy audit requirements for new data centres, which include the use of sustainable energy and more efficient infrastructure. To become more sustainable, data centres can also explore alternative cooling methods, such as using natural cooling, or liquid cooling systems.

In Southeast Asia, the annual average energy investment was around USD 70 billion between 2016 and 2020, with around 40% going to clean energy technologies such as solar PV, wind, and grids. This presents an opportunity for data centres to invest in renewable energy sources and reduce their reliance on fossil fuels.

Conducting energy audits can help data centres identify areas for energy optimization, reduce their environmental impact, and explore the use of renewable energy sources. The Singaporean government's energy audit requirements and the increasing investment in clean energy technologies in Southeast Asia further emphasise the importance of sustainability for data centres.

Develop and implement sustainability strategies

In ASEAN, the data centre industry is growing rapidly, and as a result, it is important to ensure that sustainability is prioritized.

To reduce a data centre's overall carbon footprint, sustainability strategies should prioritize renewable energy sources such as solar or wind power. In line with this, the Climate Neutral Data Centre Pact (a group of 100 data centres aligned to the European Green Deal) aims to have data centres match 75% of their electricity demand with renewable energy by December 31, 2025, and 100% by December 31, 2030.

Furthermore, data centres must consider water efficiency measures to reduce the amount of water needed for cooling. Water is a valuable resource, and data centres consume a significant amount of it for cooling. Implementing water-efficient technologies such as cooling towers and economizers can help reduce water usage and ultimately, costs.

It is important to note that the carbon footprint for data centres globally is estimated to be more than 2% of global carbon emissions, and this number is expected to rise to 3.2% by 2025 and 14% by 2040. This highlights the critical importance of developing and implementing sustainability strategies for data centres.

In addition to prioritizing renewable energy and water efficiency measures, data centres can also explore other sustainability strategies. For instance, relocating servers to colder climates can result in an 8% reduction in greenhouse gas emissions. Additionally, implementing sustainability software can help organizations measure and manage their environmental performance across different areas such as energy usage or waste production.

Overall, the data centre industry in ASEAN can take significant steps towards sustainability by developing and implementing strategies that prioritize renewable energy sources, water efficiency measures, and other sustainable practices such as relocating servers and utilizing sustainability software. By doing so, the industry can reduce its carbon footprint and contribute to a more sustainable future.

Use energy-efficient hardware and infrastructure 

Data centres are known to consume a lot of energy, and there have been concerns over their contribution to greenhouse gas emissions. What is the situation like in Southeast Asia? Are there any efforts being made to address this issue?

According to various sources, Southeast Asia has seen a rapid increase in energy consumption by data centres, with Singapore accounting for 60% of the region's data centre supply. A report suggests that data centres are responsible for up to 5% of global greenhouse gas emissions. In Singapore, data centres accounted for 7% of the country's electricity consumption. This clearly shows that data centres contribute to global warming and put a considerable strain on the environment.

However, there are efforts being made to address this issue. Singtel, for example, has installed a solar energy system at its Bedok Data Centre in Singapore, which accounts for 10% of the facility's energy needs, and the company is working towards using only electricity from renewable sources. Keppel Data Centres is also exploring the use of a floating data centre park to address land constraints in Singapore and potentially tap into an unlimited supply of seawater for cooling.

In addition, data centre operators are also adopting various measures to improve energy efficiency and reduce their carbon footprint. Hyperscale data centres are known to be more energy efficient than smaller data centres, consuming proportionally much less energy for cooling. Cooling technology solutions, such as optimizing airflow and reconfiguring computer room air conditioning (CRAC) units, can also significantly improve energy efficiency.

Overall, while data centres in Southeast Asia have contributed to the region's energy consumption and carbon emissions, efforts are being made to address the issue. With the adoption of renewable energy and the implementation of energy-efficient measures, data centres can become more sustainable and environmentally friendly.

Optimize cooling systems

The ASEAN data centre industry recognizes the importance of optimizing cooling systems to reduce energy consumption and promote sustainability. Cooling systems consume a substantial amount of energy and are therefore a critical aspect of data centre operations. The use of renewable energy sources, such as solar power, can significantly reduce the environmental impact of cooling systems. The industry is also focusing on reducing the direct water use in cooling systems, which can consume up to 30% of total data centre energy demand in older facilities. 

To promote sustainability, Singapore's government has set a power usage effectiveness (PUE) standard of 1.3 and below for new data centres, which also includes a requirement to demonstrate a commitment to innovation and sustainability solutions. Data centre providers and operators are investing in advanced cooling technologies, such as liquid cooling, which is a more efficient method of heat removal, and enables higher-density computing and energy savings.

Engage employees and stakeholders

Finally, engaging employees and stakeholders is essential to creating a culture of sustainability within a data centre. Staff training and education can help raise awareness of sustainability issues and encourage employee engagement in energy-saving initiatives. Engaging with suppliers to ensure sustainable sourcing and disposal practices are also critical. susGain for example, has pioneered an integrated app to help companies to mobilise their employees to take positive action toward sustainability. In a recent conversation with the founder of susGain, Carolin Barr said, "When setting ambitious sustainability targets, companies tend to neglect looking at the role employees play in achieving these goals. That's where susGain comes in. Our gamified community app -  which works almost like a fitness coach for sustainability - brings people together and makes practicing zero waste and carbon conscious habits fun and rewarding, whilst measuring the collective impact created. Having people vested in the cause accelerates the change from within."

In conclusion, data centres in ASEAN must take logical first steps to reduce energy costs and enhance sustainability by conducting energy audits, developing and implementing sustainability strategies, using energy-efficient hardware and infrastructure, optimizing cooling systems, and engaging employees and stakeholders. By prioritizing sustainability and energy efficiency, data centres can reduce their carbon footprint and contribute to a greener future.

The critical role of data centre energy management in smart cities and municipal planning

Overview of the growing importance of smart cities and municipal planning 

As cities become more populous and technology becomes more ubiquitous, there is an increasing need for smart cities and municipal planning. Smart cities are defined as urban areas that use technology to optimize the use of resources and improve the quality of life for their inhabitants. Municipal planning is the process of managing the development of cities and towns. Together, these two fields seek to create more sustainable and efficient cities.

The role of data centre energy management in enabling smart cities and promoting sustainable development

Data centres play a critical role in the functioning of modern cities, as they are responsible for storing and processing the vast amounts of data generated by individuals and organizations. However, data centres also consume a significant amount of energy, and their environmental impact is a growing concern. To mitigate this impact, data centre operators are increasingly adopting energy management strategies that promote sustainability and reduce their carbon footprint.

Effective data centre energy management can not only reduce environmental impact, but it can also lead to significant cost savings for the operator. For example, by optimizing airflow and reconfiguring computer room air conditioning (CRAC) units, Fujitsu was able to achieve a 48% reduction in energy consumption in two of its Australian data centres.

Examples of cities and municipalities that have successfully implemented data centre energy management initiatives

Singapore is a city-state in Southeast Asia that has made significant strides in sustainable data centre operations. In 2021, the country experienced a temporary pause in building new data centres due to concerns about climate change. 

However, the existing data centres in Singapore are expected to achieve carbon neutrality by January 1, 2030, with a goal of being powered by 100% renewable energy.

Other cities that have successfully implemented data centre energy management initiatives include Hong Kong, which has implemented a voluntary certification system for green data centres, and Yokohama, Japan, which has established a public-private partnership to promote energy efficiency in data centres. By adopting data centre energy management strategies, these cities are not only promoting sustainability but also increasing the efficiency of their data centre operations.

In conclusion, data centre energy management plays a critical role in the functioning of smart cities and municipal planning. By adopting sustainable practices, data centre operators can reduce their environmental impact and realize cost savings, while cities and municipalities can improve their overall efficiency and sustainability. Cities such as Singapore, Hong Kong, and Yokohama are leading the way in this area, and their successes can serve as a model for other cities around the world.


The growing need to enhance efficiency via ESG data and analytics is critical for data centres to meet national net-zero ambitions. It is essential to implement energy-efficient measures and adopt sustainable practices to reduce energy consumption, such as optimizing cooling technology solutions, recycling and reusing existing equipment, and using renewable energy sources. ESG data and analytics can provide valuable insights to optimize energy usage, reduce costs, and improve environmental performance. By taking action to reduce energy consumption in data centres, we can move towards a more sustainable future.

Recap of the advantages and challenges of using ESG data and analytics in data centres

Data centres have a growing need to enhance their efficiency and reduce their environmental impact. The use of Environmental, Social, and Governance (ESG) data and analytics can be a crucial tool in achieving these goals.

ESG data and analytics help data centres to track and measure their environmental impact and identify areas for improvement. This includes monitoring energy usage, greenhouse gas emissions, water consumption, and waste management. By analysing this data, data centres can identify inefficiencies and implement targeted improvements to enhance sustainability.

One of the challenges of using ESG data and analytics is the complexity of the data. Data centres generate large amounts of data, and making sense of it requires specialized expertise and technology. Additionally, collecting and analysing this data can be costly and time-consuming.

However, the benefits of using ESG data and analytics far outweigh the challenges. By enhancing sustainability, data centres can reduce their environmental impact and operating costs, increase operational efficiency, and improve their reputation among customers and investors. 

Implications for the future of sustainable IT

The future of sustainable IT is closely linked to the use of ESG data and analytics. As data centres become more sophisticated in their use of ESG data and analytics, they will be able to optimize their operations and reduce their environmental impact even further.

In ASEAN, the growing focus on sustainability and the increasing demand for data services present both challenges and opportunities for data centres. By embracing ESG data and analytics, data centres can enhance their sustainability and reputation, reduce their operating costs, and position themselves as leaders in the rapidly evolving digital landscape.

In conclusion, the use of ESG data and analytics is essential for data centres to enhance their efficiency and reduce their environmental impact. By taking logical first steps to improve sustainability and embracing new technologies and practices, data centres can position themselves for long-term success in the sustainable IT landscape.

When asked about the topic of sustainable IT for the data centre business, Dr Niladri Choudhuri, Founder and CEO of Xellentro, reiterated that IT is essential to every business. Every business process is IT enabled and we are growing in usage of IT and related products and services. IT needs to be the focal point for Sustainability for any business. We, as IT practitioners need to practice IT in a sustainable manner and also enable businesses to be sustainable with IT like we have enabled every business process with IT. This needs a 3-step process of Awareness Creation – Growing Consciousness – Enablement through IT Systems. Sustainability training will become part of every Induction training program, performance evaluation will include Sustainability KPIs starting from Board and Senior Leadership level to the executing practitioners of IT. Having clear, well-defined, realistic objectives and key results (OKRs) will be a good way to start. IT-related ESG information is to be part of the ESG Report and most parts of the ESG Report are to be generated directly from the systems for better authenticity and real-time data to act on it faster for improvement.

Call to action – reduce data centres' energy consumption to support national net zero ambitions

The call to action to reduce energy consumption of data centres in ASEAN is a crucial step towards supporting the national net zero ambition. According to a report by the ASEAN Centre for Energy, the energy demand of data centres in the region is expected to triple by 2025. This trend is particularly concerning as it will significantly contribute to the increase of carbon emissions and undermine the efforts of countries to achieve their climate goals.

  • Adopt energy-efficient hardware and virtualization to reduce the number of physical servers needed.
  • Improve cooling technology solutions to reduce energy consumption.
  • Recycle and reuse existing equipment and properly dispose of wasted IT/computing materials.
  • Use renewable energy sources and efficient energy management practices.
  • Use ESG data and analytics to optimize energy usage and identify areas for improvement

Reducing the energy consumption of data centres in ASEAN is vital to achieving the national net zero ambition. By adopting energy-efficient hardware and virtualization, improving cooling technology solutions, recycling and reusing existing equipment, using renewable energy sources and efficient energy management practices, and using ESG data and analytics, we can significantly reduce the carbon footprint of data centres and contribute to the sustainability of the region.

illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.

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About the author

Alex Hong is the Executive Director of Digipulse Data and strategic advisor. He is the Chief Sustainability Coordinator of the Youth Networking Business Committee (YNBC). Alex is LinkedIn’s Top Voices (Green) in Singapore 2022 and represents the Global Blockchain Business Council (GBBC) as the Ambassador of Southeast Asia.

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