Data centres have established themselves as a fifth utility, alongside water, electricity, gas and telecoms, due to their critical role in modern society, according to a report by GlobalData.

Global data traffic is expected to rise substantially over the next decade, driven by rising incomes and technological advancement. The report says investment in data centre construction is expected to increase significantly.

Several key data centre announcements were made for Saudi Arabia in early March. US-headquartered Amazon Web Services (AWS) announced plans to launch a new AWS Region in Saudi Arabia in 2026 as part of its long-term commitment to invest more than $5.3bn in the kingdom.

The newly formed Saudi digital infrastructure developer DataVolt announced a plan to invest $5bn in developing data centres across the kingdom.

Turkish contracting firm Dogus Construction signed a memorandum of understanding (MoU) with Saudi Arabia’s local telecommunication firm Advanced Communications & Electronics Systems Company (Aces) to develop data centre projects in Saudi Arabia.

The planned AWS Region in Saudi Arabia will comprise three availability zones, or a data centre infrastructure in separate and distinct locations “far enough from each other to support customers’ business continuity, but near enough to provide low latency for high availability applications”.

The GlobalData report highlights that building data centres brings challenges concerning sustainability.

While the demand for artificial intelligence processing capabilities is undeniable, the report warns that unchecked data centre growth could have severe environmental consequences.

Carbon footprint is significant, posing a considerable challenge in meeting stringent sustainability targets. Key challenges for data centre providers include the substantial power consumption of data centre facilities, the extensive water usage for server cooling (both directly and indirectly through electricity generation), and the escalating need for land. Recent developments, such as the moratoriums in the Dutch province of Flevoland and in Singapore, as well as tighter controls on new construction in Frankfurt, underscore the increasing intervention by governments to address these concerns.

Ensuring a reliable supply of renewable energy is not just a priority, but a necessity to sustain the significant market expansion of data centres.

Innovative cooling solutions that reduce water consumption should also be explored and implemented. Finally, project designs should be optimised to minimise land use and enhance sustainability.

By prioritising these measures, the sector can strive to overcome the challenges and continue its growth trajectory.