INDUSTRY COMMENT
Turning data centre heat into an asset
Ulrik Vadstrup, HVACR Segment Manager for ABB makes the case for recovering vast amounts of wasted heat from data centres to better serve buildings and communities
A
cruise ship navigating icy northern waters might seem an unlikely model of energy efficiency – particularly one with heated outdoor swimming pools. But rather than being a wasteful extravagance, those pools are performing a vital engineering function: absorbing heat produced by the ship’s engines as a byproduct of propulsion. Without that outlet, the heat would make the engine room and surrounding gangways dangerously hot for the crew. The pools solve a thermal problem and keep the passengers happy at the same time.
The same principle holds for data centres. AI-
driven facilities produce extraordinary volumes of waste heat, but much of that heat dissipates into the atmosphere – a loss that serves nobody. Fortunately, the technology to capture and redirect it into district heating networks and building heating systems is available today.
Liquid cooling has changed the equation
Modern data centres increasingly rely on liquid cooling, where chilled liquid – most commonly water – is piped directly through the servers, absorbing heat as it goes before being piped away. Industry practice and increasingly water-efficiency requirements favour closed-loop coolant systems – meaning the coolant must be cooled quickly before reuse. That requirement is where heat recovery integrates naturally into the system design. The recovered heat can serve the data centre building itself or it can be exported to a district
Left: Ulrik Vadstrup, HVACR Segment Manager for ABB
heating network serving surrounding buildings. In either case, heat that would otherwise be wasted is doing productive work.
McKinsey estimates that at least 3,100 thermal
terawatt-hours of recoverable heat goes to waste globally every year. And across the European Union, unrecovered industrial waste heat rivals the total heating and hot water demand of every residential and service-sector building combined.
The technology is already there
All that heat recovery requires is a heat exchanger and often a heat pump. The heat exchanger transfers the heat from the coolant to a water circuit, which then carries that energy to wherever heating is needed – whether that’s the data centre building itself, or a district heating network serving the surrounding community. For district heating, temperatures matter. Waste
heat from data centres typically sits in the 30–60°C range, while older district heating networks operate at around 90°C in winter and 60°C in summer – so a heat pump is needed to lift the water temperature to a suitable level. Efficiency here is measured by the coefficient of performance (COP): the higher the waste heat source temperature, the better the COP. But advancing technology may soon remove the need
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for a heat pump entirely. Direct-to-chip liquid cooling is pushing coolant temperatures higher, while the latest generation of district heating networks operate comfortably at lower temperatures, making direct use of waste heat in that 30–60°C range increasingly viable.
The efficiency of the heat pump itself matters. A
variable speed drive (VSD) controlling the heat pump compressor can improve the heat pump’s operating COP by enabling efficient part-load operation – as heat demand varies throughout the day and across the seasons, so heat pumps must operate efficiently across a wide load range. Higher-efficiency drives and motors further increase the amount of heat delivered per unit of electricity used. Drive design can also affect power network stability. Equipment generating electrical harmonics can impair power network performance and cause electrical problems. For weak networks, a good recommendation can be to select ultra-low harmonic drives for process reliability.
Where the real barriers lie
Heat recovery is a clear win for energy efficiency, though there is an upfront installation cost that may take some time to recoup in saved heating bills. But where savings are being passed to a district network instead, the network will often cover the system installation cost. However, even when the system is fully funded and addresses a cooling challenge at the same time, some data centre operators still walk away.
Geography is one constraint. Data centre operators
frequently site facilities in lower-cost locations, some distance from the nearest district heating network connection. Longer pipe runs increase capital cost and heat loss in transit, and beyond a certain distance the connection is no longer worthwhile. Operational mismatch is another factor. Data
centres run continuously and produce heat around the clock. District heating demand is seasonal and variable – on warm summer days, residential demand falls. Operators need contractual certainty about how much heat the network will take and what happens if at any point it is unable or unwilling to do so. Agreeing those terms remains the most significant practical obstacle to wider heat recovery in this sector.
A regulatory and commercial shift
European policy is making heat recovery increasingly hard to ignore. Several governments have removed taxation on reused waste heat, and EU frameworks now classify it as a clean heat source, a climate mitigation measure, and a qualifying green investment. District heating and cooling currently accounts for 13% of EU heat demand, with projections suggesting that figure could reach 50% by 2050 with greater industry participation. For data centre operators, heat recovery is a
concrete and scalable tool – connecting industrial heat management directly to building performance, carbon reduction, and community energy supply. The technology is proven. The only question is how quickly the industry moves to take advantage.
16 August 2026
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