Italy’s Data Center Industry is growing, but energy sustainability remains a concern

The Politecnico di Milano has presented its annual report on the state of Data Centers in Italy. The overall picture is positive, as stated by Professor Alessandro Piva, Director of the Observatory, with Milan leading the way and positioning itself as a potential European-level hub. The facilities based in the Lombard capital will reach an impressive 238 MW IT power in 2024, accounting for 46% of the total capacity of Italian-based Data Centers, which collectively amount to 513 MW IT, marking a 17% growth compared to 2023.

Milan is, once again, consolidating its role as Italy’s innovation capital. However, the challenge now lies in identifying new strategic locations across the country for further development.

Another critical issue highlighted by the Observatory’s study is the lack of a sufficient regulatory framework. Although some progress is being made, just in recent weeks, the Transport Committee of the Chamber of Deputies has initiated hearings on a new bill aimed at regulating data centers. The goal is to establish a favorable regulatory environment that would attract investments and drive the expansion of these strategic infrastructures.

According to the Observatory, 2024 marks the year in which Italy has fully recognized the importance of data center infrastructure. A staggering €5 billion has already been invested in 2023-2024 for the construction, setup, and equipping of IT servers for new facilities. Additionally, a further €10.1 billion is projected for 2025-2026.

Italy, with Milan at the forefront, is striving to shift from a secondary role to a leading position in the development of digital infrastructure, closing the historical gap with Europe’s key data center hubs, namely the FLAP-D cities (Frankfurt, London, Amsterdam, Paris, and Dublin). This growth is being driven by Italy’s strong economy and its strategic geographic location at the heart of the Mediterranean—an essential junction for major transcontinental fiber optic cables linking East and West, as well as North and South.

However, Italy faces significant challenges, primarily related to high energy costs—the country remains one of the most expensive in Europe—and supply limitations due to the aging power distribution network. These issues are particularly concerning for campus data centers, the most efficient and scalable model in today’s market. These campuses consist of multiple interconnected facilities within a designated area and currently account for 44% of Italy’s total IT energy capacity. However, they require dedicated high-voltage connections to meet their massive energy demands.

As a result, energy availability and pricing remain the biggest obstacles to the expansion of new data centers in Italy. If these challenges are not addressed, the country’s current growth momentum could slow down, favoring more competitive markets such as Spain. Additionally, environmental sustainability is becoming a pressing issue, as seen in the Netherlands and Ireland, where concerns are mounting over data centers’ energy consumption, which is projected to reach 7% of total global electricity usage by 2030.

At Smart Building Expo 2025, taking place from November 19 to 21, 2025, at Fiera Milano Rho, an important conference will be dedicated to technologies aimed at reducing the energy consumption of data centers.