Germany Watered Down Its Data Centre Heat Law to Chase the AI Boom. Europe Is Watching.

Key points

• Germany's amended Energy Efficiency Act, due for parliamentary ratification imminently, removes the legal obligation for new data centres to reuse waste heat and replaces it with a requirement only to assess whether doing so is feasible.
• The EU requires member states to cut greenhouse gas emissions by at least 55% compared to 1990 levels by 2030, and the European Commission's Joint Research Centre says data centres must halve their greenhouse gas emissions by 2030 to stay on that trajectory.
• Stack Infrastructure cancelled a $3 billion data centre facility in Hesse, and state-owned Komm.ONE withdrew from a project in Baden-Württemberg, with Komm.ONE citing the original Energy Efficiency Act directly.
• A small German town voted in February to block a $2.5 billion data centre development, partly over climate concerns, hinting at the public resistance the law change may now invite.
• Our 17 September story found that US data centres alone could consume more natural gas than Germany and Japan combined by 2035.

Germany started 2026 with a plan to double its data centre capacity and quadruple the computing power available for artificial intelligence by 2030. The goal: cut Europe's dependence on American AI infrastructure and jolt a sluggish economy. Ambitious, and, as it turned out, legally awkward.

The obstacle was a law Germany had already passed.

The 2023 Energy Efficiency Act required new data centres to pipe the heat their servers generate into nearby district heating networks or industrial users like greenhouse farms. Waste heat from a data centre is a genuine resource: the same servers crunching AI calculations run hot enough to warm homes. Patrick Graichen, who helped shape the policy as a senior official at the Ministry for Economic Affairs and Energy before resigning over unrelated cronyism allegations, said plainly: "We need clean heat, and data centers are a source of clean heat."

The data centre industry pushed back hard. Finding a willing heat buyer near every proposed site was often impossible, they argued, and the law punished them for factors outside their control. The German Data Centre Association called an early version of the bill a "data centre prevention act." Two major projects collapsed: Stack Infrastructure's $3 billion Hesse facility and Komm.ONE's Baden-Württemberg scheme, with the latter pointing directly at the Act's burdens.

In June, one month before the rules were due to take full effect, the government folded. Under the revised bill, operators need only study whether heat recycling is feasible. If it isn't, they're off the hook.

Why does this matter beyond Germany?

Because the same dilemma sits in every EU capital. The EU's climate roadmap locks member states into a 55% emissions cut by 2030, roughly 90% by 2040, and full net-zero by 2050. Data centres already account for 1.4% to 1.6% of total EU electricity consumption, and AI workloads are pushing that figure up. As AI2Day has reported, AI agents, software programmes that carry out multi-step tasks autonomously, guzzle far more power than a simple chatbot.

Germany's central location lets data traffic flow efficiently into both Western and Eastern Europe, so developers have strong commercial reasons to build there. The law change may free that pent-up demand. It may also trigger the kind of climate-focused activism and permitting freezes that have already slowed data centre expansion across parts of the United States. That February town-council vote is an early signal, and it fits a pattern Graichen described to Wired: attitudes toward data centres have "switched completely" in the last year, first in the US, and he expects Europe to follow.

John Booth, managing director at IT consultancy Carbon3IT, who helped devise EU-wide energy efficiency targets for data centres, told Wired there is "absolutely no reason except the will of the organization" why a data centre cannot use its waste heat. Graichen is blunter: "Stop complaining."

The German government frames the amendment differently. When the cabinet approved the change, federal economic minister Katherina Reiche called it "practical rules" that create "the conditions for digital sovereignty and economic growth." That word, sovereignty, carries real weight at a moment when European governments are anxious about relying on American cloud providers for critical infrastructure. The Nvidia deal struck in Berlin this month shows just how seriously Berlin is chasing that ambition.

What the climbdown really shows is that climate targets and AI ambitions aren't automatically compatible. When the two collide, at least one European government has chosen to blink on climate first. Whether the rest of the EU, or German voters, let that stand is the thing to watch.