A guide to building sustainable data centres in the age of AI
GoodBlog | read time: 7 min
Published: 1 August 2025
The rapid expansion of artificial intelligence (AI) technologies over the last decade has brought with it vast opportunities for economic growth, innovation, and improved public services. AI is now being deployed extensively across sectors, from healthcare diagnostics and education platforms to manufacturing automation and government service delivery. According to a recent report from Lloyds Banking Group an estimated 59% of UK businesses are currently employing AI in some form, and this is only expected to grow. Consumers too are driving the tremendous surge
To meet this surge in AI demand for 2025 alone, about 44 gigawatts of computing capacity will be required worldwide, as reported by McKinsey. That demand is expected to nearly triple by 2030, driven by AI’s expanding applications across almost all industries and increasingly sophisticated models requiring vast computational power.
Underpinning this AI revolution is a critical digital infrastructure challenge: the need for large-scale, resilient data centres capable of processing and storing ever-growing volumes of data securely and efficiently. Forecasts suggest that data centre energy consumption could more than double by 2030. In the US, the Energy Information Administration projects that data centres could consume up to 9% of national electricity by 2030, while global estimates anticipate electricity use surpassing 945 terawatt-hours annually.
In the UK, Europe and other leading economies, governments and businesses are recognising this infrastructure as imperative. Globally, data centre construction is set to scale up at unprecedented levels, requiring an estimated $6.7tn by 2030. The UK’s data centre capacity is projected to more than double by 2029 from 1.7GW to 4GW, with 48 new centres in the pipeline. In Europe, the AI Continent Action plan aims to triple data centre capacity by 2030, with further booms in data centre construction expected in the US, China and developed Asia-Pacific economies.
However, this global boom in data centre usage and construction also raises a key question: how can we build data centres responsibly and mitigate against the multiple environmental, social and governance (ESG) challenges associated with data centre construction?
Identifying and managing the ESG risks of data centres
Wherever the location, there will be environmental, social and governance risks associated with the construction of a new data centre. Many of these are similar to those associated with any large infrastructure project. With over 25 years working for companies in the construction, oil and gas and extractives sectors, GoodCorporation has particular expertise in helping companies identify and mitigate the ethical and sustainability risks associated with such projects.
We have also advised companies involved in data centre construction, identifying common ESG risks that must be addressed to strengthen governance and reduce and mitigate social and environmental harms.
Environmental Risks
Data centres are inherently energy-hungry. Servers need constant power, and cooling systems require vast amounts of water and electricity, often sourced from fossil fuels. These demands risk contributing significantly to carbon emissions and water scarcity – especially when data centres are located in regions already facing environmental stress.
By far the largest component of this is the electricity consumed by data centres, which the IEA estimates amounted to 400TWh in 2024 alone. Worldwide, 85% of data centre electricity consumption is in the USA, Europe and China, where large data centres are located in clusters.
When it comes to construction, companies need to consider energy consumption across the data centre’s entire lifecycle, from resource usage and emissions waste to renewable energy procurement and water-efficient cooling technologies, making sure to take account of any actual and potential impacts on the local ecosystem.
GoodCorporation recommends starting any major infrastructure project such as data centre construction with a detailed environmental impact assessment (EIA), in alignment with the requirements of the local authority. This will establish the likely impact on the local area and the mitigating measures that can be implemented to reduce actual and potential harms. Issues to consider include land disturbance, soil erosion, pollution, run-offs, biodiversity, waste management, emissions as well as water usage and water contamination.
Companies committed to environmental responsibility will also place environmental sustainability as a key criterion in site selection and design. Having identified all the risks, a plan will be needed to map out the options available to mitigate harms, optimise energy efficiency and build sustainability into the operation. This will help embed environmental sustainability into every phase of the data centre’s lifecycle.
For the construction phase, this is likely to involve prioritising low-carbon and recycled building materials, minimising construction waste and integrating effective measures to protect the local ecosystem. From an operational perspective, energy efficiency is essential: leveraging advanced cooling systems, optimising server utilisation, employing monitoring systems to identify inefficiencies, and investing in renewable energy sources all significantly reduce emissions and reliance on fossil fuels.
Water usage in particular needs to be carefully managed. Data centres require vast amounts of water. According to the IEA, data centres globally currently use 560 billion litres of water per annum and this figure could double by 2030. Research from Bloomberg also shows that data centres are increasingly being built in water-scarce regions, because their locations are chosen primarily on the basis of electricity availability, economic viability, and business or political incentives, with water availability getting less consideration. Water usage can be managed through closed-loop, water-efficient or refrigerant-based cooling systems as well as careful monitoring to avoid wastage and inefficiencies.
Many jurisdictions will have environmental regulations and reporting requirements that must be followed. However, irrespective of any local requirements, internationally recognised best practice sets out certain standards that should be followed by companies committed to environmental sustainability and the drive to net-zero. GoodCorporation’s environmental framework is based on these standards and can be used as a basis for managing the governance systems that need to be implemented to mitigate the environmental impacts of such a project.
Social Risks
When developing and operating data centres, the social risks, especially relating to community impacts, require careful management. Large-scale construction can disrupt local communities, potentially displacing residents, altering land use, and placing additional strain on housing, infrastructure, water, and energy supplies. In many cases, particularly in jurisdictions with weaker regulation, workers may also be exposed to poor labour conditions or inadequate protections, while local populations may see limited employment benefits.
Unaddressed, these issues can erode trust, provoke community resistance, and damage a company’s reputation. To mitigate these risks, GoodCorporation recommends the following steps: –
Human Rights Impact Assessments (HRIAs)
Before commencing any high-risk infrastructure project, a comprehensive HRIA should be undertaken to identify both actual and potential harms. This should begin with a risk mapping exercise to establish where in the operation the human rights risks lie, who might be affected and the likelihood and severity of such risks occurring. This will establish the scope of the assessment and ensure that all risks are covered.
Once the scope has been established, in-depth interviews and focus groups should be carried out with all rightsholders to ensure all actual and potential human rights impacts, root causes, and proposed solutions are brought to light. Stakeholder engagement should be at the heart of this process, involving confidential consultation with a wide range of rightsholders; community members and representatives, workers and their organisations (including trade unions), civil society organisations (CSOs) and NGOs, as well as relevant governmental authorities.
This extensive engagement ensures that the perspectives and lived experiences of those potentially impacted are properly understood and inform every stage of the risk assessment and mitigation process
Analysis and Remediation
Insights from stakeholder consultations are consolidated and analysed against international human rights standards and recognised best practice. Recommendations are made to address root causes, taking into account the severity of potential impacts and the context-specific needs of affected groups. Effective grievance mechanisms must also be established to provide rightsholders with access to remedy and support the early resolution of any concerns raised.
Ongoing Monitoring and Engagement
Regular monitoring through further stakeholder engagement, audits, and feedback mechanisms, ensures that mitigation measures remain effective and can be adapted to any evolving issue or unforeseen consequences.
Training and Capacity Building
Managers and subcontractors should also be trained on international human rights, ethical conduct, and worker welfare best practices to embed high standards throughout the operation.
Governance Risks
In addition to the environmental and social risks, data centres pose governance challenges that, if unaddressed, raise vulnerabilities around security, compliance and reputational risk. Weak regulatory frameworks in some jurisdictions can lead to inadequate controls over data protection, cybersecurity, anti-bribery, and corruption safeguards. Poor governance raises the risk of network downtime, data breaches, and legal infringement.
Regulators are increasingly emphasising robust governance in digital infrastructure, including mandatory transparency requirements, resilience testing, and accountability frameworks. GoodCorporation has been working with data centre operators to develop environmental and social management systems that align with the environmental and social standards set by the EU to ensure compliance with all relevant legal frameworks.
This has included code of conduct development supported by a suite of policies covering issues such as procurement, record keeping, supplier management, due diligence, whistleblowing and data protection. Data management is a highly complex area for data centre operators who store immense volumes of sensitive personal and business data. Ethical risks include potential data breaches, misuse of consumer information, and failure to implement adequate security measures.
There is also tension between commercial imperatives to leverage data for competitive advantage and ethical obligations to protect privacy. In addition, data centres increasingly integrate AI and automation, raising ethical issues around algorithmic fairness, job displacement, and accountable decision-making in infrastructure management.
Operators need to be cognisant of these myriad risks and ensure that robust controls are properly embedded to ensure that data is properly stored, protected and used.
Key takeaways
Data centres can be safe and sustainable while meeting the growing demand for connectivity in today’s economy. ESG issues need to be identified from the outset according to the nature and location of each specific operation. This helps ensure that sustainability is incorporated into the design and regulatory best practices are established from the outset, facilitating openness and transparency while enabling operators to comply with increasing regulatory and reporting demands.
GoodCorporation has an established track record in identifying, managing and mitigating the wide range of ethical, compliance and sustainability risks associated with the construction and operation of large infrastructure projects such as data centres.
Contact us to explore how we can support your organisation in navigating the business ethics risks of data centres and AI infrastructure development.
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