UII UPDATE 386 | JULY 2025

Intelligence Update

EU energy efficiency package may slow digital growth

The European Commission is linking its Energy Efficiency Directive (EED) mandate to the Commission’s digital and AI strategy as part of its renewed energy efficiency commitment and data center efficiency package to be announced in Q1 2026.

The Commission’s Commissioner for Energy and Housing, Dan Jørgensen, recently announced an energy efficiency package outlining 10 key areas for the Commission to prioritize (see New impetus for energy efficiency). The data center-specific energy efficiency package that is proposed for publication with the Commission’s Strategy Roadmap on Digitalisation and AI in Q1 2026 will be of particular interest to data center operators.

The Commission has confirmed with Uptime Intelligence that the data center energy efficiency package is closely linked to the EED. The package is expected to include:

  • An analysis of the reported EED data.
  • The final delegated regulation for the EED rating/labeling scheme for adoption.
  • The opening of the public consultation for EED minimum performance standards (MPS).
  • Other relevant items.

Consultation with member states regarding the delegated regulation for the rating/labeling scheme should start one to two months before the announcement (mid-Q4 2025).

Although the Commission is revising the ecodesign requirements for IT equipment (Lot 9, 2019/424), no formal announcement regarding this revision is expected to be included in the announcement of the Q1 2026 energy efficiency package.

The Commission’s decision to include the EED rating/labeling scheme in the announcement of the package suggests it is close to being finalized. Organizations with concerns about its contents are encouraged to submit their comments as early as possible. Uptime Institute has already submitted its comments to the Commission (see EU plans introduction of rating system).

Whereas the EED rating/labeling system identifies high-performing data centers, the MPS are designed to drive improvements or the decommissioning of underperforming facilities. Uptime estimates that at least 40% of European data center space will have to retrofit new equipment or relocate to a new facility to meet the proposed PUE and WUE MPS (see Are EU data center performance values creating chaos?). This contrasts sharply with the Commission’s Strategy Roadmap on Digitalisation and AI (also due to be released in Q1 2026), which aims to boost digitalization. This digitalization drive aligns with Uptime‘s research, which indicates continued growth in traditional (non-AI) data center capacity across Europe.

The Commission’s digital and AI strategy was launched to compete with the US and China, with the aim of boosting AI use, improving regulations, and encouraging investment in infrastructure and training. In early 2025, the Commission committed €20 billion ($23.5 billion) to build four AI gigafactories, each projected to be populated with IT infrastructure consisting of 100,000 advanced GPU/accelerator chips. Although the initial focus on large training facilities is understandable, it neglects the growing significance of deploying AI inferencing engines in smaller edge facilities to realize the productivity gains in public and private operations, which were promised by the AI revolution. This contrasts sharply with China's current policy of actively supporting inference-related chips, software and data center infrastructure.

Enforcing overly strict EED MPSs with aggressive timelines risks overlooking the need for edge data center capacity to support both the growth of traditional workloads and, increasingly, local AI inferencing. The rapid growth of AI is straining facility capacity and supply chains, making it challenging to upgrade data centers to new standards without risking disruption to digital services. Operators and other interested stakeholders should prepare for — and make their voices heard — in the public MPS consultation, which will be announced in Q1 2026 as part of the energy efficiency package.

Note: The regulatory analysis provided in this report is the opinion of Uptime Intelligence. Data center operators should validate the interpretations with their legal staff and any relevant regulatory authorities.

About the Author

Tomas Rahkonen

Tomas Rahkonen

Dr. Rahkonen is the Research Director Sustainability, Europe at Uptime Institute. Rahkonen has spent the last 25 years in positions within the telecommunications, mobile communications, and data center sectors globally, and most recently served as the CTO of Flexenclosure, where he managed the design and delivery of prefab data centers across four continents.

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