How does green energy power data centres?

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Key drivers:

• Green energy comes from renewable, low-carbon sources like wind, solar, and hydro - essential for reducing emissions and ensuring sustainable power for growing digital infrastructure.
• Transitioning from fossil fuels to renewables offers long-term benefits in cost stability, energy security, and environmental performance, despite requiring upfront investment and new infrastructure.
• For data centres, integrating renewables through on-site generation, PPAs, efficiency measures, and emerging options like green hydrogen is key to meeting sustainability goals.
• RED helps clients design and operate data centres powered by clean, efficient energy systems - turning sustainability ambitions into practical, high-performance outcomes.

Digital infrastructure is now one of the world’s fastest-growing sources of energy demand. Every transaction, stream, or cloud process draws power from systems that never stop running and never stop drawing power. 

The industry is at a turning point. Fossil fuels once powered digital growth, but cost pressures, policy, and climate responsibility are now driving a rapid shift to cleaner, more efficient power systems. This transition is complex. It demands more than switching energy sources - it requires a redesign of how systems are engineered and operated.

From homes to hyperscale data centres, understanding what green energy is, how it works, and why it matters is essential for anyone involved in building, operating, or investing in infrastructure that will still be running in 2030, 2040, and beyond.

At RED, we’re helping clients move from ambition to implementation. We've been integrating renewable energy into complex, mission-critical facilities for years, and know that sustainability isn't about compromise - it's about designing smarter, building better, and ensuring that performance and responsibility go hand in hand.

What is green energy?

Green energy is electricity generated from renewable, naturally replenishing sources that produce little to no carbon emissions or environmental harm. Unlike fossil fuels (coal, oil, and natural gas), which are finite and emit high levels of greenhouse gases, green energy relies on sustainable processes that can operate indefinitely without depleting natural resources.

The defining characteristics of green energy include:

• Renewable - The source regenerates naturally and won't run out.
• Low or zero emissions - Generation produces minimal carbon dioxide, pollutants, or waste.
• Environmentally responsible - Designed to minimise ecological impact across the full lifecycle.

Green energy and renewable energy are often used interchangeably, but they’re not identical. Renewable energy refers to sources that naturally replenish, while green energy focuses on environmentally responsible, low-carbon generation. Together, they form the foundation for sustainable, future-ready infrastructure.

What are green energy sources?

So, how does green energy work? It captures natural processes (sunlight, wind, water flow, geothermal heat), converting them into usable electricity. The technology may differ, but the principle is consistent: capture energy from a renewable source, convert it into electrical energy, and distribute it through the grid.

• Solar energy converts sunlight into electricity using photovoltaic panels or concentrated solar power systems. Light excites electrons in the panels, producing an electric current.
• Wind energy captures the power of moving air. Turbines convert the wind’s kinetic energy into mechanical motion, which drives a generator to produce electricity.
• Hydropower harnesses flowing or falling water. Water passes through turbines in dams or run-of-river systems, spinning them to generate power.
• Geothermal energy draws on heat stored beneath the Earth’s surface. Steam or hot water is brought to the surface to drive turbines or provide direct heating.
• Biomass energy converts organic material (wood, agricultural waste, or purpose-grown bioenergy crops) into electricity or heat through combustion or biochemical processes.

Once generated, green energy is fed into the electrical grid, where it's distributed to homes, businesses, and industrial facilities just like traditional electricity. Modern battery storage and smart grid systems allow excess energy to be captured and released as needed, helping maintain a stable supply even when sunlight or wind levels fluctuate.

Beyond large-scale renewables, decentralised microgrids are playing an increasingly important role in delivering green energy on the ground. These local systems combine renewable sources with high-efficiency fuel technologies to provide reliable, low-carbon power for critical infrastructure - including data centres and hospitals.

At RED, we’ve explored how advanced energy recovery systems, such as the Organic Rankine Cycle, can capture waste heat and convert it back into electricity, significantly improving overall fuel utilisation. 

Our insight article on Enhancing Fuel Utilisation Of Decentralised Microgrids demonstrates how this approach can increase total electrical efficiency from around 49% to over 58%, reducing both fuel waste and emissions while improving energy resilience.

Green energy vs. fossil fuels - pros and cons

Shifting from fossil fuels to green energy is a fundamental change in how we power our infrastructure. While each energy source comes with its own set of challenges, the lasting benefits of renewables for reliability, carbon reduction, and energy resilience are becoming increasingly undeniable. 

Before comparing renewables and traditional fuels, it’s important to revisit what is green energy and why it underpins the global transition to cleaner power systems.

Pros of green energy

• Renewability - Sources like wind and solar regenerate naturally and will never run out.
• Low emissions - Green energy produces little to no greenhouse gases during generation, reducing air pollution and climate impact.
• Declining costs - Solar and wind have become cost-competitive with fossil fuels in many markets, and prices continue to fall.
• Energy independence - Renewable sources reduce reliance on imported fuels and increase national energy security.

Cons of green energy

• Intermittency - Solar and wind generation fluctuates with weather and time of day, requiring secure storage solutions and backup strategies. In our Roadmap to Zero-Carbon and Water-Negative Data Centres insight, we look at how battery systems, fuel cells, and thermal storage can make renewable energy a dependable part of operations.
• Infrastructure investment - Transitioning to renewables requires significant upfront capital for generation, storage, and grid upgrades.
• Geographic constraints - Not all regions have equal access to renewable resources, though technology improvements are broadening viability.

Fossil fuels

Fossil fuels are still common in many regions because the infrastructure is in place and they provide steady, reliable energy. But they come with serious environmental costs, including carbon emissions and air pollution, and they rely on limited resources. For data centres and other high-energy industries, continuing to rely on fossil fuels is increasingly unsustainable.

At the same time, advances in battery storage, smart grids, and hybrid energy systems are making it much easier to rely on renewable sources. For data centres, this means it’s possible to run large, energy-intensive facilities while dramatically reducing their environmental impact.

Why is green energy important?

The move to green energy is a huge economic opportunity. It drives innovation, creates jobs across manufacturing, installation, maintenance, and grid management, and strengthens long-term operational resilience.

Businesses often ask: Is green energy cheaper? While installation and setup costs can be higher initially, over time the long-term savings typically outweigh initial costs. Renewables offer more predictable energy costs through lower fuel bills, reduced exposure to carbon pricing, and tools like corporate power purchase agreements (PPAs) or on-site generation - helping organisations manage long-term budgets and shield themselves from volatile energy markets.

Beyond cost, the sector itself is growing rapidly: data from the International Renewable Energy Agency shows employment in the renewable energy sector reached 16.2 million jobs globally in 2024, marking an 18% increase year‑on‑year, demonstrating the wider economic gains that come with investing in sustainability.

The environmental case for renewables is equally strong. They cut greenhouse gas emissions, reduce water use, and improve air quality. For mission‑critical facilities like data centres, energy performance is closely monitored by customers, investors, and regulators alike. Meeting sustainability targets is a core part of staying competitive, and investing in green energy is central to delivering on that responsibility.

What are green energy credits (REGOs)?

In the UK, renewable electricity is verified through Renewable Energy Guarantees of Origin (REGOs). Issued by Ofgem, each REGO certifies that one megawatt-hour of electricity has been generated from renewable sources and supplied to the National Grid. 

These certificates can then be sold to energy suppliers, allowing them to prove that the electricity they supply is sourced from renewables. For organisations working towards carbon reduction or net-zero goals, REGOs demonstrate genuine environmental progress and accountability.

REGOs deliver the greatest impact when paired with direct renewable energy procurement. PPAs, on-site generation, and investment in new renewable capacity deliver stronger sustainability and economic outcomes than certificates alone.

At RED, we work with clients to identify the right mix of renewable energy options, whether that’s REGO-backed supply contracts, on-site solar, or long-term PPAs, helping ensure their sustainability strategies are credible and aligned with long-term operational goals.

What is a green data centre?

Data centres are some of the most energy-intensive facilities in the built environment. With global demand set to more than double by 2030, the sector's approach to energy sourcing will play a defining role in the success or failure of global climate targets.

A truly green data centre incorporates renewable energy at its core, cutting reliance on fossil fuels and reducing carbon emissions. Across data centres, renewable energy strategies are becoming essential to meet sustainability and regulatory expectations. This can be achieved in a number of ways:

On-site renewable generation

Installing solar panels, wind turbines, or combined heat and power systems on or near a facility allows data centres to produce low-carbon electricity directly. Battery storage enables excess energy to be captured and used during peak demand or grid outages.

Power purchase agreements

Long-term contracts with renewable energy providers guarantee a consistent supply of green power - often at predictable rates. PPAs support the development of new renewable capacity while giving data centre operators price stability and carbon reduction, as explored in our insight on Sustainability in Engineering: Transforming Data Centres into Eco-Friendly Hubs.

Grid-supplied renewables

In regions with strong renewable energy grids, data centres can source green power directly from utility providers. This is particularly effective in markets with strong hydropower or wind generation, such as Scandinavia.

Energy efficiency and waste heat recovery

Green data centres pair renewable energy with efficiency improvements. Advanced cooling systems, low-PUE designs, and capturing waste heat for district heating reduce overall energy demand, making renewable integration more practical and cost-effective.

Green hydrogen and fuel cells

Emerging technologies such as green hydrogen, produced with renewable electricity, can provide long-duration backup power without emissions - providing a low-carbon alternative to diesel generators.

At RED, sustainable data centre design is central to everything we do. From planning sites with integrated solar, wind, and energy storage to incorporating waste heat export and advanced cooling systems, our approach ensures that facilities deliver measurable sustainability benefits while maintaining peak operational performance.

Powering the future sustainably

Green energy is a practical, scalable, and increasingly cost-effective way to power the infrastructure that underpins modern life - from transport and manufacturing to the data centres that keep the digital economy running.

Understanding what green energy is, how it works, and why it matters is the first step. The second is embedding it into the design, operation, and long-term strategy of the facilities we build today.

At RED Engineering, we've been designing energy-efficient, sustainable, and mission-critical facilities for over two decades. Our expertise spans MEP design, sustainability consulting, and full lifecycle advisory - ensuring every project we undertake not only performs at the highest standards today but is also ready to adapt for tomorrow’s demands.

Ready to explore how renewable energy can power your next project? Get in touch with RED’s sustainability team to discuss how we can help integrate green energy into your facilities’ design, operations, and long-term strategy.