From data center spas to servers in space: How the energy crunch is reshaping cloud computing

December 29, 2025

TL;DR

The growth of AI is placing immense pressure on data centers, which consume large amounts of energy and water.
Traditional data center designs are struggling to meet sustainability goals and power AI workloads efficiently.
Innovative concepts include underground data centers, modular 'data villages' that share heat with communities, and even orbital data centers.
Key challenges to adopting these new designs include high costs, engineering complexity, regulatory barriers, and scalability.
Space-based data centers face hurdles such as radiation, cooling in a vacuum, launch costs, and reliable communication.
Regional adoption will vary, with the U.S. potentially favoring large-scale campuses and Europe facing more constraints.
Existing examples of sustainable data center practices include using seawater for cooling and repurposing heat for local needs like swimming pools.
Regulatory changes and grid upgrades are necessary to support future data center innovations.
The success of space-based data centers may depend on significantly lower launch costs, such as those anticipated with Starship.

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