AI boom thrusts Europe between power-hungry data centers and environmental goals
A large hallway with supercomputers inside a server room data center.
Luza Studios | E+ | Getty Images
The boom in artificial intelligence is ushering in an environmentally conscious shift in how data centers operate, as European developers face pressure to lower the water temperatures of their energy-hungry facilities to accommodate the higher-powered chips of firms such as tech giant Nvidia.
AI is estimated to drive a 160% growth in demand for data centers by 2030, research from Goldman Sachs shows — an increase that could come at a cost to Europe’s decarbonization goals, as the specialized chips used by AI firms are expected to hike the energy use of the data centers that deploy them.
High-powered chips — also known as graphics processing units, or GPUs — are essential for training and deploying large language models, which are a type of AI. These GPUs need high density computing power and produce more heat, which ultimately requires colder water to support reliable cooling of the chips.
AI can consume 120 kilowatts of energy in just one square meter of a data center, which is equivalent to the power consumption and heat dissipation of around 15 to 25 houses, according to Andrey Korolenko, chief product and infrastructure officer at Nebius, who referred specifically to the deployment of Nvidia’s Blackwell GB200 chip.
“This is extremely dense, and from the cooling standpoint of view you need different solutions,” he said.
The problem we’ve got with the chipmakers, is AI is now a space race run by the American market where land rights, energy access and sustainability are relatively low on the pecking order, and where market domination is key,” Winterson told CNBC
Michael Winterson
chair of the EUDCA
Michael Winterson, chair of the European Data Center Association (EUDCA), warned that lowering water temperatures will eventually “fundamentally drive us back to an unsustainable situation that we were in 25 years ago.”
“The problem we’ve got with the chipmakers is [that] AI is now a space race run by the American market where land rights, energy access and sustainability are relatively low on the pecking order, and where market domination is key,” Winterson told CNBC.
Major equipment suppliers in Europe say that U.S. chip designers are calling on them to lower their water temperatures to accommodate the hotter AI chips, according to Herbert Radlinger, managing director at NDC-GARBE.
“This is shocking news, because originally everybody from the engineering side expected to go for liquid cooling to run higher temperatures,” he told CNBC, referring to the technology of liquid cooling, which is said to be more efficient than the more traditional method of air cooling.
‘Evolution discussion’
Energy efficiency is high on the European Commission’s agenda, as it seeks to reach its goal of reducing energy consumption by 11.7% by 2030. The EU predicted in 2018 that energy consumption of data centers could rise 28% by 2030, but the advent of AI is expected to boost that number two or threefold in some countries.
Winterson said that lowering water temperatures is “fundamentally incompatible” with the EU’s recently launched Energy Efficiency Directive, which established a dedicated data base for data centers of a certain size to publicly report on their power consumption. The EUDCA has has been lobbying Brussels to consider these sustainability concerns.
Energy management firm Schneider Electric engages often with the EU on the topic. Many of the recent discussions have focused on different ways to source “prime power” for AI data centers and for the potential for more collaboration with utilities, said Steven Carlini, chief advocate of AI and data centers and vice president at Schneider Electric.
European Commission energy officials have also had exchanges with Nvidia to discuss energy consumption and the use of data centers with regard to the effectiveness of power use and that of chipsets.
CNBC has approached Nvidia and the Commission for comment.
“Cooling is the second-largest consumer of energy in the data center after the IT load,” Carlini told CNBC in emailed comments. “The energy use will rise but the PUE (Power Usage Effectiveness) may not rise with lower water temperatures despite the chillers having to work harder.”
Schneider Electric’s customers that are deploying Nvidia’s Blackwell GB200 super chip are asking for water temperatures of 20-24 degrees Celsius or between 68 and 75 degrees Fahrenheit, Carlini said.
He added that this compares to temperatures of around 32 degrees Celsius with liquid cooling, or of around 30 degrees Celsius that Meta has suggested for the water it supplies to the hardware.
Ferhan Gunen, vice president of data center operations for the U.K. at Equinix, told CNBC that there are a number of concerns about AI that Equinix has been discussing with its customers.
“They want to increase the density of their servers, which is, they want to have higher-power-using chips, or they want to have more servers,” she said, adding that the shift is not “clear cut.”
“It’s really an evolution discussion more than anything,” Gunen said.
Nvidia, which declined to comment on the cooling requirements of its chips, announced a new platform for its Blackwell GPUs earlier this year. It said that the architecture would enable organizations to run real-time generative AI on large language models at up to 25 times less cost and energy consumption compared to earlier technology.
Liquid cooling will require a “reconfiguration,” Gunen explained, adding that new data centers are already coming ready with this technology. “Yes, higher density will mean more power use, and will also mean more cooling requirement. But then the technology is changing, so you’re doing it differently. That’s why there is a balance in all of this,” she said.
Race for efficiency
Nebius, which has around $2 billion in cash on its balance sheet after splitting from Russia’s Yandex, has said it will be one of the first to bring Nvidia’s Blackwell platform to customers in 2025. The firm has also announced plans to invest more than $1 billion on AI infrastructure in Europe by the middle of next year.
Nebius’ Korolenko said liquid cooling is a “first step,” where cost of ownership will initially be worse before improving over time.
“There’s a big push to deliver, but at the same time, when you go to scale, you will want to have the ability to choose, to be economical and not sacrifice too much. Power efficiency is important for the running costs. It’s always a high priority,” Korolenko said.
Even before a boom in demand for AI applications hit the market, the data center industry in Europe was struggling to keep pace with the growing digital sector.
Sicco Boomsma, managing director of ING’s TMT team, said those involved in the market are “very sensitive to power” and that while Europe’s focus is on infrastructure, the U.S. has focused more on expanding assets in Europe where power is available.
“There’s a tremendous amount of data center operators also coming from the U.S. that are aligning in order to ensure that their data center infrastructure is in line with the various goals that the EU has as well, such as being carbon neutral, such as being efficient, on water utilization, maintaining biodiversity.”
“It is a sort of a race where they want to demonstrate that their knowledge is leading to super efficient infrastructure,” he said.
Locals call him the “Bicycle hero,” but Texas man Evan Wayne says he’s just doing what he can to help his community after it was cut off due to the recent devastating and deadly flooding tragedy.
When the local Sandy Creek flooded following torrential rains in Texas, it destroyed the only bridge into one community. Residents were cut off from access to supplies, including everything from necessities like food, water, and medicine to basic comforts.
Although the bridge was impassable to cars, volunteers who quickly organized to help the stranded residents found that the damaged bridge could still be traversed on foot. Or in the case of Evan Wayne, it could be covered by an electric bike.
Evan joined hundreds of volunteers who answered the call of grassroots organizers by working together without any official capacity. While many started by hand-pulling garden carts of supplies uphill to reach the stricken community, Evan jury-rigged a trailer to an e-bike and took on as much of the load as he could, helping shuttle much-needed food and gear into the community over hundreds of round-trip journeys.
“This was a dog trailer 48 hours ago. I had a hacksaw, hacked the top off, grabbed some bungee cords, and here we are,” explained Evan in an interview with CBS Austin, while waiting for the next load of gear to be stacked on his trailer.
In the first two days of the operation, he made around 100 round trips each day, shuttling food and water as well as critical rescue supplies. “Right now, I’m waiting on a couple of chainsaws that I’ll bring in for a crew that’s been going at it with handsaws so far.”
In addition to delivering needed supplies, Evan has often found himself moving something even more important: information. “I’ve flagged down medics. I’ve been the guy that goes between Austin EMT and STAR Flight because I’m quicker than cell phones sometimes, people don’t have signal a lot of the time.”
Evan quickly points out that he isn’t the only one helping. “I’ve got an e-bike, but other people are pulling carts. People are walking, people are carrying things. Everyone is doing what they can.” But there’s no doubt that his ability to carry more gear at higher speeds and make hundreds of round-trip journeys so far in and out of the stricken neighborhood has helped impact countless lives.
“This is all volunteers here. They’re just taking it upon themselves to get people where they need to go. I think there’s an umbrella company coming in, taking over tomorrow, but until they get here, people are just taking care of people, which is what you’ve got to do.”
E-bikes proving their worth in emergencies
While many people consider electric bicycles just another form of recreation, they’ve proven to be potent transportation alternatives after natural disasters worldwide.
Not only do their small and efficient batteries make performing hundreds of rescue trips like Evans’ possible, but recharging can be done simply and easily with a solar panel when electricity is out after a disaster. And when gas stations are out of fuel (or simply can’t pump it with the power grid down), e-bikes can keep running while gasoline-powered motorcycles or ATVs run dry.
Electric bicycle batteries have also proven to be a handy source of emergency power after hurricanes and other disasters, often helping owners keep their phones charged up for days to remain in contact with family or rescue services.
While most hope to never need theirs for emergency purposes, electric bicycles have proven their worth in countless disaster scenarios, adding benefits far beyond just alternative transportation, recreation, or fitness riding.
Image credits: CBS Austin (screenshots), used under fair use
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Twitter CEO Jack Dorsey testifies during a remote video hearing held by subcommittees of the U.S. House of Representatives Energy and Commerce Committee on “Social Media’s Role in Promoting Extremism and Misinformation” in Washington, U.S., March 25, 2021.
Handout | Via Reuters
Block jumped more than 5% on Monday, leading a rally in shares of fintech companies as analysts downplayed the threat of JPMorgan Chase’s reported plan to charge data aggregators for access to customer financial information.
The recovery followed steep declines on Friday, after Bloomberg reported that JPMorgan had circulated pricing sheets outlining potential fees for aggregators like Plaid and Yodlee, which connect fintech platforms to users’ bank data.
In a note to clients on Monday, Evercore ISI analysts said the potential new expenses were “far from a ‘business model-breaking’ cost increase.”
In addition to Block’s rise, PayPal climbed 3.5% on Monday after sliding Friday. Robinhood and Shift4 recorded modest gains.
Broader market momentum helped fuel some of the rebound. The Nasdaq closed at a record, and crypto rallied, with bitcoin climbing past $123,000. Ether, solana, and other altcoins also gained.
Evercore ISI’s analysts said that even if JPMorgan’s changes were implemented, the most immediate effect would be a slight bump in the cost of one-time account setups — perhaps 50 to 60 cents.
Morgan Stanley echoed that view, writing that any impact would be “negligible,” especially for large fintechs that rely more on debit, credit, or stored balances than bank account pulls for transactions.
PayPal doesn’t anticipate much short-term impact, according to a person with knowledge of the issue. The person, who asked not to be named in order to speak about private financial matters, noted that PayPal relies on aggregators primarily for account verification and already has long-term pricing contracts in place.
While smaller fintechs that depend heavily on automated clearing house (ACH) rails or Open Banking frameworks for onboarding and compliance may face real pressure if the fees take effect, analysts said the larger platforms are largely insulated.
WATCH: Congress moves to redraw $3.7 trillion crypto market rules, opening door to Wall Street
The global EV market is still charging ahead. According to new numbers from global research firm Rho Motion, 9.1 million EVs were sold worldwide in the first half of 2025, up 28% compared to the same period last year. But not every region is accelerating at the same pace.
China and Europe are doing the heavy lifting
More than half of the world’s EVs this year have been bought in China. That market hit 5.5 million sales in the first six months of 2025 – a 32% jump year-over-year. Around half of new cars bought in China are now electric.
While some Chinese cities’ subsidies have dried up, Rho Motion expects momentum to pick back up later in the year as more funding is released.
In Europe, 2 million EVs were sold in the first half of the year, up 26%. Battery electric vehicle (BEV) sales also rose 26%, thanks in part to affordable models like the Renault 4 (pictured) and 5 entering the market. Plug-in hybrids (PHEVs) weren’t far behind, growing 27% year-to-date. Chinese automakers are leaning into PHEVs as a way to work around the EU’s new tariffs on BEVs.
Spain is leading the pack with EV sales soaring 85% so far this year. Its generous MOVES III incentive program was extended in April and has kept sales strong. The UK and Germany are also seeing solid growth – 32% and 40%, respectively. France, however, is slumping. With subsidies cut, EV sales there have dropped 13%.
North America is stuck in the slow lane
Things aren’t looking quite as bright in North America. EV sales in the US, Canada, and Mexico are up just 3% so far this year.
Mexico is the one bright spot, with a 20% boost. The US is up 6%. But Canada is down a whopping 23%.
And things could get bumpier. On July 4, Trump signed Congress’s big bill into law, which axes all the Inflation Reduction Act EV tax credits. Those consumer credits for EVs now officially end on September 30.
Just over half of the EVs sold in the US this year qualified for those credits. Rho Motion predicts a rush in Q3 before the subsidies disappear – and a decline in sales after that.
Rho Motion data manager Charles Lester said, “With Trump’s latest cuts in his ‘Big Beautiful Bill,’ the US could struggle to see any growth in the EV market overall in 2025.”
Global EV sales snapshot, H1 2025 vs H1 2024
- Global: 9.1 million (+28%)
- China: 5.5 million (+32%)
- Europe: 2.0 million (+26%)
- North America: 0.9 million (+3%)
- Rest of world: 0.7 million (+40%)
Read more: China breaks records as global EV sales hit 7.2 million in 2025
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