When we think of energy companies, we often think of old, storied institutions that are dealing with the giant physical building blocks of our energy system. But these days, energy companies are actually having to become digital companies as well.

Artificial intelligence and the exponential growth in big data processing are both generating new energy needs and changing the way in which energy is distributed. The giant data centres that are popping up across Europe are significantly increasing energy usage. But the data they’re generating could also help decrease energy usage.

Speaking at a Euractiv stakeholder workshop last week, Lorenzo Fiorillo, the technology director at Italian energy company Eni, noted that these technological breakthroughs are changing the way companies like his are operating. Eni may have roots going back to 1926, but today the company is very much operating as a technology company of the 21st century.

“It’s not just from now that we’re considering ourselves a technology company, because this is a mindset that is in our DNA for a while, if you look at our historical decisions,” he said. “But today technology is once more at the centre, opening up new frontiers and opportunities for our business. We’ve been having data centres for more than ten years. One of the first major data centres in the world is in Italy -the second one in Europe was HPC6, which is in our premises.”

Data centre challenges

Stakeholders at the workshop noted that EU policy is going to be critical in making sure Europe is at the forefront of the digital transition for energy. The upcoming AI and Cloud Development Act, envisioned by the European Commission’s AI Continent Action Plan, aims to create a new regulatory framework to foster these infrastructures.

The goal, explained Pablo Riesgo Abeledo from the European Commission’s energy department, is to align these initiatives with Europe’s climate and strategic autonomy goals, and position the EU as a globally competitive environment for deploying cutting-edge AI.

“The strategic decision with the Cloud and AI Act is clear: we want to have these data centres in the EU, but there are challenges in having them,” he said. “Sometimes they have huge power needs, and the evolution is that they’re getting bigger and bigger. For other energy-intensive industries like steel plants, they take years if not decades to build. The data centres can arrive and be connected to the grid in a much shorter time. For a grid operator, that’s a huge challenge, to have such a huge demand in one single point in just a few years.”

“We’re looking at ways of making these data centres more efficient, notably in terms of waste-heat recovery,” he said. “Data centres generate a lot of heat – how can we recover it and use it in district heating?”

Participants also noted that there are ways to strategically locate these new data centres in ways that make them less of a burden on the grid. “It’s important that they’re located in geographic areas where they can have access to abundant renewable energy, and also where there is sufficient grid capacity and land capacity,” said Riesgo Abeledo.

Continuous energy flow

Fiorillo agreed. “The well-located areas are limited – those that are close to renewable sources with available grid power, with no environmental constraints, you get a situation where that available area is saturated very soon. So we need to be ready to consider also other solutions.”

He said. “Even if you cannot directly use renewable energy, or when it’s not continuous – which is important for a data centre – you need to find other solutions. In our case, we are working to have the possibility to produce power and capture and store the CO2.”

Riesgo Abeledo said that permitting blocks are also going to be addressed by the Commission. “We want to make sure that we avoid stranded assets or speculative projects; that’s something that happens with data centres applying for quite a few projects and then only choosing one.”

Data boosting efficiency

The Commission isn’t only looking at how to mitigate data centres’ energy usage, they’re also looking at how data centres can improve the efficiency of the grid system as a whole. “We have a treasure trove of resources that needs to be explored – especially by SMEs,” said Juan Pelegrin from the Commission’s digital department.

He noted that the supercomputing enabled by the data centres can, for instance, improve accuracy for fossil fuel exploration fields and optimise the best location and performance for wind farms. “With supercomputers we can do the modelling, the improve the precision of forecasts. This has a lot of policy implications; it can even save lives,” he said.

“But we need to train people how to use these supercomputers and optimise the AI. Today, the uptake of AI remains a challenge; it remains low, not only in Europe. We need to see in the strategy how we can foster and enable that.” Pelegrin pointed to the Commission’s recent AI Factories Initiative as something that can help with that. “We have enabled access to computers for our SMEs in Europe to computers, along with programming help and algorithm development.”

Vincenzo Renda, Director for Digital Transformation Policy at the industry association DIGITALEUROPE, which in particular represents SMEs, said this was good to hear. He noted that the EU AI Act helped give legal certainty to the companies in this space and to set a global regulatory framework, but now the companies need help with instrumentalising the AI.

He said there is concern that the act is going to slow down the uptake of AI solutions in Europe. “The amount of SMEs using the technology today is not very high compared to other regions. So there’s an opportunity, in the context of the digital package that will come in December, to assess where we can simplify the regulation and also provide certainty for those companies who want to take a model, fine-tune it, and then leverage the potential.”

(BM)

This article follows the policy debate “AI, supercomputing, and the energy transition – Strategic infrastructure for Europe’s climate and digital leadership“ supported by Eni.