However, regulatory bottlenecks and sustainable energy sourcing are compounding an already complex ecosystem.
At Datacloud Energy & ESG 2025 in Brussels, a panel of industry experts across the digital infrastructure landscape sought to navigate the challenges of scaling data centres to meet AI’s power-hungry demands.
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The scale-up challenge
Despite AI’s rapid evolution, the infrastructure to support it is struggling to keep pace.
Judith Gardiner, VP of growth for emerging markets at Equinix, suggested that the core issue is not the technology itself but the speed and volume of scaling.
“The scale-up is the challenge right now, with the speed and the amount of data required we are being pushed to the limits in many markets,” Gardiner said, pointing to the need for alternative locations beyond the FLAP (Frankfurt, London, Amsterdam, Paris) metros.
“We are seeing slow movement towards shifting centres of gravity to cities like Madrid, Milan, and Warsaw, but there's still hesitation due to latency concerns and perceived risk.”
One of the biggest concerns raised by the panel was the availability and distribution of clean energy — an issue now shaping where data centres can realistically be built.
Tom Kingham, senior director of design at CyrusOne, highlighted the growing reliance on on-site generation.
“On-site generation is not the answer, but in many cases, it’s the only thing we can do. Gas-fired generation is the quickest to build, and while it doesn’t feel right, it's the only viable option in some regions,” Kingham said.
He pointed to Germany’s efforts to integrate hydrogen as a cleaner alternative but stressed that blindly constructing gas plants is an inefficient long-term solution.
Meanwhile, Andres Acosta, innovation director at LevelTen Energy, emphasised the economic and regulatory factors influencing power procurement.
“Defining what constitutes ‘clean’ power is critical. Do we go where the grid is already decarbonised, or do we invest in markets that need green energy the most? Pricing has fluctuated significantly, especially in markets like Spain and the Nordics, where renewable energy supply has been volatile.”
Regulatory bottlenecks and infrastructure delays
Even as demand grows, the panel suggested regulatory frameworks and permitting delays are holding back expansion.
“The planning and approval process is simply not aligned with the speed at which AI data centres need to be built,” Gardiner said. “We need a fundamental shift, countries need to be announcing how they plan to upgrade infrastructure holistically, not just throwing out gigawatt investment figures.”
Concerted efforts in some markets are being made to get things through the door faster.
The UK, for example, has pushed to streamline planning by allowing operators to apply for ‘Nationally Significant Infrastructure Project’ (NSIP) status, potentially cutting years off approval timelines.
The UK has also pushed for ‘AI Growth Zones’, areas which will act as dedicated infrastructure hubs, as well as planning overhauls for nuclear reactors.
Referencing an earlier panel where it was suggested transmission projects in Europe can take up to 13 years to complete, Kingham said: “A 13-year lead time for transmission infrastructure is not an acceptable response to this crisis.”
Kingham praised the AI Growth Zones concept but revealed a striking oversight: National Grid, the UK’s utility firm, was not involved in early discussions his team had about where these zones will likely be.
“There's a lot of work that we need to do with the transmission companies and with energy providers to tell them how we're actually going to consume this energy, and to build a profile that enables us to build these very large scale sites in locations without causing very significant transmission or network upgrades that we just aren’t going to use,” he added.
Sustainability: A pressing reputation problem
While data centre operators are prioritising sustainability, public perception is another battle.
During the panel, Miranda Gardiner, executive director of the iMasons Climate Accord, stressed the need for industry leaders to proactively shape the narrative.
“We do not have a good reputation in the public eye. The media paints data centres as villains consuming massive amounts of power. We must ensure that AI infrastructure is not just efficient but also a force for decarbonisation,” she said. “If we, as an industry, don’t drive sustainable innovation, who will?”
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