Italy's data center market is experiencing robust growth, with an annual growth rate between 4% and 8%. In 2023, investments reached €654 million, marking a 10% increase from the previous year. The value of both private and public cloud services has also risen significantly, totaling €4.8 billion, supported by approximately 70 active operators in the market, according to Boston Consulting Group (BCG).
In contrast, countries like Germany and the Netherlands are restricting the construction of new data centers due to concerns over emissions, water consumption, and grid stability. BCG emphasized the need for decentralization of infrastructure to reduce data transmission latency and address security issues, prompting hyperscalers such as Amazon and Microsoft to invest in Southern Europe, including Italy and Spain.
As the energy capacity consumed by Italian data centers grows, BCG asserts that there is an urgent need to accelerate the development of specific regulations to govern the sector, support its transition, and facilitate growth ambitions. Currently, energy consumption is at 430 MW, accounting for 3% of the national electricity usage. BCG advocates for a regulatory framework tailored to data centers, which are still categorized as generic industrial buildings without a specific classification code.
Emerging options to meet the increasing energy demands of data centers include small modular reactors (SMRs), which can provide continuous, low-carbon energy. Google and Amazon have signed agreements to promote the development of SMRs, designed to be more cost-effective, quicker to build, and safer than traditional nuclear reactors. BCG concluded that the response of energy company leaders, AI giants, and end-users to the rapidly evolving landscape will depend on regional contexts, with regulations potentially prioritizing certain climate technologies over others.