Climate crisis danger for data centers is real—and solutions are scarce

Nothing is free from consequences of the climate crisis—including data centers.

Threats to tech infrastructure from heat, flooding, and other weather-related dangers are not a new phenomenon, nor are they unique to data centers. But as the industry builds capacity to manage the AI boom, concerns over the climate crisis’s impact are growing.

Siddartha Jha, CEO of climate solutions platform Arbol, sees the danger as an opportunity for the tech industry to adjust its priorities toward climate risk management. The money involved is not a trivial concern, he added.

“Your cost structure can be very linked to weather,” Jha said.

Problem solvers. The climate crisis presents a complex problem without simple solutions. XDI’s 2025 Global Data Centre Physical Climate Risk and Adaptation Report, released in July 2025, found more than 22% of existing data centers are under high or medium risk from climate crisis threats. An October 2025 World Economic Forum report suggests that the cost of running data centers could increase by $81 billion in 2035 and $168 billion in 2065. A cumulative increase of trillions of dollars in losses for the industry could occur due to climate hazards such as drought.

Some AI advocates believe that powering data centers with clean energy can cut down on those costs. Others, like Grantham Research Institute on Climate Change and the Environment Policy Fellow Roberta Pierfederici, are thinking bigger.

“The reality is that AI can also be leveraged as a tool to accelerate climate action,” Pierfederici told Atmos.

Quick fixes. In the immediate term, though, data center owners and operators need to be thinking of what works best. Insurance is a good first step to addressing the threat, Jha told IT Brew, especially when customized to the specific dangers by region.

Those dangers can vary, but tend to fall into a few location-dependent categories: excessive heat, extreme storms like hurricanes and tornadoes, fire and hail, and so on. Potential impacts get worse from there, Jha said, positing a hypothetical disaster that could damage the electrical grid.

“There’s a cascading set of effects, where the grid power outage spreads…and then you have, on top of that, frozen pipes and many other issues that happen because you don’t have grid power,” Jha said. “Different data centers have different degrees of reliance on the grid, but that’s a huge problem, especially as the grids have become more strained and there’s a need on the infrastructure side to upgrade power lines and so on.”