79% of data processing centers globally are situated in areas with a high susceptibility to climate-related threats, such as fires, floods, and extreme winds. These events can disrupt operations, prolong downtime, and consequently increase expenses for insurance and repairs. This information is reported by CNBC, citing a study by First Street.
“Most underwriters for real assets still rely on historical data, but the climate is no longer behaving as they predicted,” stated First Street CEO Matthew Eby. “With escalating heat, drought, and water scarcity, outdated models no longer offer a complete picture of the risk.”
According to the research, over half of all data centers worldwide are located in regions prone to chronic climate stress, including extreme heat or drought. The Asia-Pacific region faces the highest risk, with 89% of centers under threat – the highest proportion globally. In the Americas, 50% of data centers are at risk, while in Europe, the Middle East, and Africa, this figure stands at 46%.
One of the concerns is that investors consider traditional metrics when constructing new data processing centers, neglecting climate change impacts that can directly affect long-term operational conditions. Data centers typically have a lifespan of 20 to 30 years.
“Investors who factor these elements into their underwriting and capital allocation decisions will have better opportunities to identify resilient markets and avoid mispriced risks,” the study suggests.
Some developers are indeed considering the climate, such as Digital Realty. The company is actively working to ensure an adequate water supply for cooling its centers.
“Almost all of our data centers today, numbering 300 globally, either operate on waterless systems or feature a closed-loop water supply,” said Andrew Power, CEO of Digital Realty. “Imagine no evaporation. We are making investments and choosing to do so.”
Researchers indicate that developers can implement resilience measures for building envelopes to protect structures from severe weather events. However, the systems connected to data centers are paramount concerning both internal and external vulnerabilities to climate risks. Jeremy Porter, Chief Economist at First Street, advises developers to look beyond risks associated with the building and site, and to think systemically.
“Acute climate risk can be mitigated through building adaptation, so that’s not the biggest problem. Then you start to think about the system, though you start to think about infrastructure, egress, site access, power access. There is a mitigation path for buildings, but there is a mitigation path for the community,” Porter explained.
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Джерело новини: mezha.ua