Vertiv: Data Centers, the AI Race Drives Investments. But Electric Network and Skills Remain the Real Bottlenecks

Milan is the Italian capital of data centers. In this area, most of these infrastructures are concentrated, approximately two-thirds of all those present in Italy, so much so that the Lombardy Region issued a law at the end of May to regulate the phenomenon. Not to limit it, mind you, but to set boundaries and contain the impact on the environment and local communities. A law that requires prioritizing brownfields, i.e., disused and abandoned plants, to build new data centers, imposes specific limits on water consumption (water used for cooling cannot be drawn from municipal aqueducts), and the energy supply must favor renewable sources. This is an extremely important issue, especially considering that in the coming years we will see many more being built, driven by AI.

But what is the real impact of these infrastructures on the environment? And why is most of them concentrated in Lombardy, especially in Milan? We delved into the topic during a meeting with Andrea Faeti and Federico Mastroleo, respectively Sales Director Enterprise Accounts and Senior Sales Director EMEA at Vertiv.

Data Centers: Why Are Most Located Near Milan?

When building a complex and energy-intensive infrastructure like a data center, positioning is a critical aspect. They must be built in areas where there is availability of energy and connectivity, of course. From this perspective, Milan is an ideal choice due to the presence of numerous industries (and therefore power plants) as well as being one of the central hubs for connectivity in Italy. This is a necessary but not sufficient condition; the presence of specific skills in this area is also fundamental. And it is indeed in Lombardy that most of the (not very many, to be honest) people with the deep knowledge necessary to operate these complex infrastructures are concentrated. "New data centers are primarily built where others already exist, because that is where the know-how of the entire supply chain and the specialized workforce to operate them are found," emphasizes Faeti.

And this is one reason why Puglia, which has a significant energy surplus mainly due to the high concentration of renewable generation plants, is not very attractive for those building data centers.

Data Centers: Numerous Connection Requests, But Implementation Progresses Slowly

The requests for authorization for new data centers are numerous; however, construction is still proceeding slowly. In May, for context, the requests amounted to a staggering 79 GW. To understand the magnitude of the figure, consider that as of now, total Italian production amounts to 137.6 GW. It is not surprising, therefore, that the actual connections made (the deployment) are less than 5% of the requests. The reasons are numerous. On one hand, the bureaucracy holds things back, even if a new draft decree could streamline the process, reducing it to just 13 months. But it's not enough to streamline the authorization procedures: it's not feasible to connect campuses of tens of megawatts as if nothing were happening. The electric network would not withstand the load. Consequently, it is also necessary to wait for Terna, which manages the Italian electric distribution network, to give the green light for new constructions. For this reason, according to Faeti, "the strategic entry and involvement of energy utilities is essential" in this matter. Energy companies should, according to Vertiv, collaborate more with the ecosystem, building new power plants for energy production. Plants that cannot rely solely on renewables, which play a fundamental role but will never be enough by themselves, primarily because they are intermittent sources. Using batteries for storage is, to date, unthinkable, given the extremely high costs of BESS (Battery Energy Storage System) systems of this size. Therefore, combined cycle gas plants are essential, as nuclear power, despite the government's opening, cannot be implemented in the short term.

Data Centers and Water Consumption: Myth or Reality?

A topic that is often raised is water consumption: critics of these infrastructures argue that they can create enormous damage to local communities and even agriculture. However, this is not always true; in fact, according to Mastroleo, it is unjustified alarmism.

It is true that there are examples, especially in the USA, where the construction of new data centers has caused water supply problems for communities living near the data center, but these are specific cases. "These apocalyptic scenarios do not represent reality and, above all, are not applicable to Italy," affirms Mastroleo. The issue is very simple: liquid cooling systems are chosen because they are more efficient than air solutions, and to cool data centers containing hundreds of racks that can consume up to 100 kW each, there are no alternatives. But liquid cooling systems come in two types: adiabatic and non-adiabatic. The former involve the evaporation of the liquid and, consequently, a waste. The latter, on the other hand, are closed-loop systems, making water consumption negligible. And it is precisely these last ones that are used in the overwhelming majority of cases in our country.

Liquid cooling systems also have a significant advantage: this technology heats the water, even up to 50°, which can then be used to provide heat to businesses and residences near the data center through district heating. It should, however, be noted that it is not automatic to be able to use district heating near every computing infrastructure: for it to work, it is necessary to build homes and pipes specifically designed for this purpose (as was done in Brescia many years ago). Retrofitting a traditional building may not be economically and energetically advantageous.

Progress Cannot Be Stopped, But Greater Collaboration with Institutions, Utilities, and the Territory is Needed

The development of data centers has gone beyond a purely technological dimension to become a strategic issue that requires a true "social pact" with the territory. As emerged during the meeting, according to Vertiv, synergy between operators, energy utilities, and political institutions is essential to define a shared national plan. Only through this alliance can data sovereignty be ensured, disinformation on the topic curbed, and value returned to local communities, transforming these essential infrastructures into a driver of sustainable innovation, both economically and environmentally.