Data centres face sustainability reporting requirements from multiple directions. CSRD's mandatory reporting applies to data centres meeting the size thresholds. The EU Energy Efficiency Directive (EED) creates separate reporting on energy use. And the EU Taxonomy requires data centres to demonstrate environmental alignment for taxonomy-eligible activities. Understanding how these frameworks interact is essential for data centre operators and the technology companies that depend on them.
CSRD Scope for Data Centres
Data centre companies meeting the CSRD thresholds (Wave 2: 250+ employees, €40M+ turnover, €20M+ assets — any two of three) must file CSRD-compliant reports from financial year 2025 (report due 2026).
Most hyperscale data centre operators are already in Wave 1 (large public interest entities). Mid-market colocation providers and enterprise data centres typically fall into Wave 2.
Most Material ESRS Topics for Data Centres
ESRS E1 — Climate Change (Almost Always Material)
Data centres are energy-intensive facilities with significant GHG footprints. ESRS E1 is almost certainly material for every data centre operator.
Required disclosures:
Scope 1 emissions: Diesel generator use (backup power), refrigerant leakage from cooling systems, on-site fuel use.
Scope 2 emissions: Energy purchased from the grid. Data centres are major electricity consumers — typical PUE (Power Usage Effectiveness) of 1.2–1.8 means significant energy draw.
- Location-based Scope 2: emissions factor based on the national or regional grid mix
- Market-based Scope 2: emissions factor based on contracted renewable energy (PPAs, RECs, GOs)
Scope 3 emissions: For data centres, the most significant Scope 3 categories include:
- Category 1: Purchased goods and services (servers, networking equipment)
- Category 2: Capital goods (data centre construction, major equipment installation)
- Category 11: Use of sold products (emissions from customers' workloads)
Climate transition plan: Data centres are expected to commit to renewable energy sourcing and efficiency improvements. Industry commitments (Climate Neutral Data Centre Pact, RE100) are increasingly expected as part of transition plan credibility.
Physical climate risk: Locations vulnerable to flooding, extreme heat, or water scarcity face physical climate risks that must be assessed and disclosed.
ESRS E3 — Water and Marine Resources (Frequently Material)
Data centres are significant water consumers — particularly air-cooled and cooling tower systems. Key disclosures:
- Total water withdrawal by source
- Water consumption in water-stressed areas
- Water recycling ratio
- Cooling technology approach and its water implications
Hyperscale operators in water-stressed regions (Arizona, Ireland, Netherlands) face increasing regulatory and community scrutiny over water consumption. This makes ESRS E3 material for many data centre operators.
ESRS E5 — Resource Use and Circular Economy
Electronic waste (WEEE) from decommissioned servers is a significant issue. Disclosures:
- Server refresh rates and equipment lifetimes
- Refurbishment and second-life approaches
- WEEE disposal methods
- Circular economy targets for IT equipment
ESRS S1 — Own Workforce
Standard own workforce disclosures — headcount, health and safety, pay equity.
EU Energy Efficiency Directive (EED) Requirements
Separate from CSRD, the EU EED requires data centres above certain thresholds to report energy and performance data to the EU:
EU JRC Data Centre Register: Data centres with an installed IT load of 500 kW or more must register and report energy and performance data to the European Commission.
Required metrics:
- IT equipment energy (actual consumption)
- PUE (Power Usage Effectiveness) — measured annually
- Water Usage Effectiveness (WUE)
- Renewable energy percentage
- Server utilisation rates
- Waste heat recovery
Reporting cadence: Annual submission to the EU register.
Interaction with CSRD: The EED data provides the underlying metrics that feed into ESRS E1 and E3 disclosures. Companies subject to both should build a single data collection system that satisfies both requirements.
EU Taxonomy Alignment
The EU Taxonomy includes data transmission, storage, and management (NACE code J63.11) as a climate change mitigation taxonomy-eligible activity.
Technical screening criteria for data centres (climate change mitigation):
- PUE ≤ 1.3 by 2025 (reduced to 1.2 for new data centres from 2027)
- Renewable energy coverage: increasing to 100% by 2030
- Water cooling: responsible water use in water-stressed areas
- Heat reuse: surplus heat reuse from data centre operations
CSRD and Taxonomy intersection: CSRD-reporting data centre companies must disclose their EU Taxonomy alignment — the proportion of revenue, capital expenditure (CapEx), and operating expenditure (OpEx) from taxonomy-eligible and taxonomy-aligned activities.
Practical Reporting Priorities for Data Centres
Immediate priorities:
- Implement energy management system — ISO 50001 or equivalent — to generate the granular energy data ESRS E1 and EED require
- Measure and report PUE monthly; confirm reporting to EU JRC register if above 500 kW installed IT load
- Calculate Scope 2 market-based emissions — contract renewable energy (PPAs, GOs) if not already done
- Assess water consumption and cooling technology — flag if any sites are in water-stressed areas
- Establish server lifecycle and WEEE tracking
Medium-term:
- Calculate Scope 3 Category 1 (supply chain emissions for servers and equipment)
- Build a climate transition plan with renewable energy milestones
- Assess EU Taxonomy alignment for capital investment decisions