For Big Tech, there are few better places to experiment with data center heating than in the Nordics. This idea works best when data centers can be connected to preexisting district heating systems, where a group of buildings share a common heating system instead of each having their own. These communal systems are commonplace in countries like Denmark, Finland, and Sweden—and tech isn’t the first industry to experiment with connecting to them.
For the past 20 years, Patrik Öhlund’s home in the northern Swedish city of Luleå has been partly heated by the waste heat from a nearby steel plant. Now, Öhlund, who is director of Energy Markets at Microsoft, is working on recreating this system in the Finnish city of Espoo. But this time it’s Microsoft that’s being hooked up to the local district heating network as part of a project that will eventually heat 100,000 households. Once completed, it’s expected to be the largest data center heating system in the world.
Microsoft’s project in Espoo will generate slightly hotter water—90 degrees Fahrenheit (32.2 degrees Celsius)—than Meta’s Danish system, partly because the Finnish data center will also have the capacity to power AI systems. Finnish energy company Fortum will then boost the heat to between 180 and 250 degrees Fahrenheit (82.2 and 121.1 degrees Celsius), before it enters people’s homes—which should happen sometime after 2025. Heat extracted from data centers that power AI tends to be hotter because they often have a higher-density setup of server racks, says Tom Glover, head of data center transactions at real estate consultancy JLL. “You’re provided with a higher quality of heat, which can be used better within district heating grids,” he adds.
When Microsoft’s Espoo system is switched on, energy prices won’t necessarily be cheaper, according to Teemu Nieminen, who leads the data center heat recovery project for Fortum. Neither company will disclose how much Microsoft is charging for the heat, but they do confirm it’s part of a commercial arrangement. It might not be cheaper, but prices should be more stable, says Nieminen, “compared to fossil fuels, where prices fluctuate very wildly.”
Microsoft also hopes this stability will help make data centers on this scale more welcome in local communities, some of whom take issue with Big Tech sucking up huge amounts of renewable power. “It will keep the prices stable, and with people living nearby knowing this … they are also more positive to our data centers,” says Öhlund.