AI Data Centres: Power, Cooling & Sustainability Challenges

The explosive growth of AI continues to transform the data centre industry, creating unprecedented challenges around power availability, cooling efficiency and environmental sustainability. 

As AI workloads drive a projected 160% increase in data centre power demands, traditional infrastructure approaches are reaching their limits. To tackle this, the data centre industry is having to find new ways to adapt to a new reality. 

With this in mind, we hear from Johan Nilerud, Chief Strategy Officer at Khazna Data Centers, who offers his insights into how liquid cooling technologies and renewable energy integration can support power-hungry AI, while maintaining commitments to carbon neutrality and sustainable growth in an increasingly digital economy.

Please introduce yourself and your role at Khazna Data centres.

My name is Johan Nilerud and I serve as the Chief Strategy Officer at Khazna Data Centers.

I joined the company in April 2023 as Senior Director of Strategy and Planning. As a key member of the company’s executive leadership team, my role is to oversee the development and execution of our long-term strategic vision and growth plans. 

I also manage Khazna’s ESG, customer excellence and performance management efforts. I have a passion for innovation and customer-centricity and a keen interest in emerging technologies and trends.

What are the most critical challenges facing the data centre industry currently, particularly when it comes to cooling, power availability and interconnectivity?

The surge in AI applications, particularly generative AI (Gen AI), is fuelling unprecedented demand for data centre capacity around the world. So much so that the availability of power has become a critical bottleneck for data centre growth. 

In Europe, for instance, demand outpaced supply in 2024, with vacancy rates dropping below 10%.

Data centres are currently responsible for 2% to 3% of global electricity consumption and about 1.5% of global carbon emissions. Those figures could double in five years and traditional data centre design and cooling solutions will be unable to keep up with the demands of modern computing requirements.

How is Khazna tackling these challenges through its data centre innovations to support AI growth?

People may think of data centres as rows of servers. But to us, they’re drivers of growth. As economies digitise, it’s these facilities that enable transformation and innovation. They’re the foundation layer of the new economies that governments around the world are trying to build.

The data centre segment is growing at 23.2% year-on-year to over US$405bn and AI workloads are projected to result in a 160% increase in data centre power demands. 

At Khazna, we’re not chasing the AI wave, we’re building what the wave will need to survive.

Given that Khazna has recently expanded its UAE presence, how do its data centres hope to address the unique power and cooling demands of frontier AI models?

The global economy is undergoing a huge transformation driven by the adoption of AI. 

From medicine to city management, to the way we create and consume content, we’re going through a transformational phase, thanks to the unprecedented computational capabilities available to us. This represents a revolution in how businesses, societies and economies operate.

At Khazna, we see ourselves as crucial to this worldwide transformation, providing agile, adaptable environments designed specifically for the dynamic and high-density computing needs of AI technologies. 

We currently have 263MW of operational capacity, are on track to deliver 175MW of capacity under construction, have announced two new data centres in Abu Dhabi and our entry into Türkiye and Saudi Arabia.

Last year, we opened the UAE’s first liquid-cooled AI data centre. Liquid cooling offers a cutting-edge solution for managing data centres that host AI workloads, as traditional data centre cooling solutions become increasingly unable to keep up with the demands of modern computing requirements.

We have also broken ground on our QAJ1 facility, the MENA region’s first AI-optimised data centre that will feature a robust 100MW capacity and has been designed to meet the specific requirements of AI applications, offering high computing power and scalability. 

In addition, we recently broke ground on new facilities in Abu Dhabi, further reinforcing our commitment to supporting the UAE’s AI ambitions through advanced infrastructure expansion.

What policy and partnership frameworks are needed to ensure AI-driven data centre growth doesn’t conflict with net-zero commitments?

Sustainability is an industry challenge and we need to work collaboratively to solve it. Without partnering across the ecosystem – between clients, governments, utility providers and more – we won’t be able to solve the dual challenge of securing power for the increased data centre demand and ensuring that power is delivered in a sustainable manner.

While those conversations are ongoing, at Khazna we are taking our own steps. Our Masdar facility is powered in part by a 7MW solar photovoltaic. 

We have backup generators capable of running on Hydrotreated Vegetable Oil (HVO) and are actively exploring a reliable supply for this cleaner fuel, which could cut our diesel emissions by up to 90%. 

Across our development pipeline, including future facilities in Italy and Kenya, we are designing for 100% clean energy usage where viable. In regions where clean energy is not yet readily available, we focus on building the most efficient data centres possible, supported by advanced cooling innovations such as adiabatic and direct liquid cooling.

We are also in active discussions with utility providers to increase our clean energy mix and remain committed to achieving carbon neutrality by 2050 – a goal that reflects both our ambition and our responsibility.

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