By Tamas Mark, Global Head of Real Assets
As global digitalisation accelerates, data centres have become the backbone of the modern economy, powering everything from cloud computing to AI and digital services. However, this rapid growth comes with a significant environmental cost. Data centres are among the most resource-intensive assets in the built environment, consuming vast amounts of electricity and water, generating substantial heat, and contributing to global carbon emissions. In response, investors, regulators and end users are demanding greater transparency and accountability in environmental, social and governance (ESG) performance.
IQ-EQ, in collaboration with BuildingMinds, Norton Rose Fulbright and the Urban Land Institute, have launched a whitepaper outlining how data centres can transform from environmental liabilities to leaders in sustainable infrastructure.
This detailed paper highlights that although much of the focus tends to be on front-end innovation and infrastructure, the often-overlooked middle and back-office functions play a pivotal role in ensuring data centres meet sustainability goals. These teams are essential for monitoring performance, managing energy procurement, and delivering accurate ESG reporting – functions that are now critical to the long-term viability of the sector.
The role of the middle office: monitoring and reporting
Middle-office professionals are responsible for implementing robust management systems that track key sustainability metrics. These include Power Usage Effectiveness (PUE), Water Usage Effectiveness (WUE) and Carbon Usage Effectiveness (CUE), as defined by ISO/IEC 30134 standards. Maintaining these metrics within acceptable thresholds is not only a regulatory requirement but also a key factor in attracting and retaining investor confidence.
With increasing scrutiny from stakeholders, middle offices must ensure that data is accurate, timely and aligned with global reporting frameworks. This includes preparing disclosures for sustainability indices, investor reports and regulatory filings. By doing so, they help position data centres as credible, responsible investments in a rapidly evolving market.
Energy procurement: a strategic middle-office function
One of the most critical responsibilities of the middle office is energy procurement. As data centres strive to operate on 100% renewable energy, middle-office teams must analyse consumption patterns and negotiate long-term contracts that align with sustainability goals. Power Purchase Agreements (PPAs), particularly those involving solar, wind, tidal and hydroelectric sources, are essential tools in this strategy.
Diversifying energy sources is key to ensuring reliability, as solar and wind can be intermittent. Leading operators like Microsoft, Amazon and Google have invested heavily in renewable energy infrastructure, often co-locating energy generation with data centre facilities. These investments not only provide a stable energy supply but also shield operators from market volatility and geopolitical disruptions.
Virtual PPAs (VPPAs) and Renewable Energy Certificates (RECs) offer additional flexibility, allowing data centres to support renewable projects even when direct consumption isn’t feasible. Green tariffs, though less stable in pricing, are another option used by companies like Meta to support fully renewable operations.
Geographic load shifting and infrastructure investment
To further optimise renewable energy use, middle offices can implement geographic load shifting, relocating data processing to regions with greater renewable energy availability. Google, for example, has moved operations to areas with abundant solar power to ensure 24/7 clean energy supply. This strategy not only reduces reliance on fossil fuels but also supports the development of regional renewable infrastructure.
Investment in large-scale renewable projects is also accelerating. Google’s $20 billion partnership with Intersect Power and TPG Rise Climate aims to build co-located energy plants next to data centres, ensuring a direct and reliable supply of clean energy. Such initiatives highlight the strategic importance of middle and back-office functions in driving long-term sustainability.
The back office: leveraging technology for efficiency
Back-office teams are equally vital, particularly in their use of technology to enhance operational efficiency. By deploying proprietary and third-party software, often powered by artificial intelligence (AI), back offices can monitor energy and water consumption in real time. AI-driven analytics enable predictive maintenance, load balancing and optimisation of cooling systems, all of which contribute to reduced resource usage and lower emissions.
These systems also support compliance by automating data collection and reporting, reducing the risk of human error and ensuring consistency across multiple sites. As sustainability becomes a competitive differentiator, the ability to demonstrate real-time performance improvements can significantly enhance a data centre’s market position.
Meeting the growing demand
The urgency of these efforts cannot be overstated. Between 2012 and 2023, data centre power demand grew at a compound annual rate of 14%, far outpacing the 2.5% growth in electricity generation. In Ireland, data centres are projected to consume 32% of total electricity by 2026, up from 17% in 2022. Meeting this demand sustainably will require an additional 100 GW of new wind and solar projects by 2035, equivalent to $120 billion in capital expenditure.
Enabling the future
In the race toward sustainable digital infrastructure, middle and back-office functions are no longer behind-the-scenes players, they are strategic enablers of change. From monitoring ESG metrics and managing energy procurement to leveraging AI for operational efficiency, these teams are essential to the success of modern data centres. As the industry continues to grow, their role will only become more critical in ensuring that innovation and environmental responsibility go hand in hand.
Contact our team today to discover how strategic middle and back-office functions can transform your data centre operations.
