Dorota Derlicka and Tomasz Chabrzyk write on the Bird & Bird website that data-centre waste heat is shifting from being an interesting sustainability opportunity to something developers may actually have to plan for and justify under EU law. Poland provides a particularly useful example of what that change could mean in practice.
Waste heat from data centres – An emerging regulatory consideration in Poland
Data centres consume significant amounts of electricity, most of which is ultimately converted into heat. Until recently, the treatment of that heat was mainly an engineering and sustainability issue. Under the EU energy efficiency framework, it is increasingly becoming a regulatory consideration as well.
This development is particularly relevant in Poland, where the Government is working on legislation intended to transpose the relevant requirements of the recast Energy Efficiency Directive into the Polish Energy Law.
The EED introduces a specific obligation for data centres
Directive (EU) 2023/1791 on energy efficiency (the EED) requires Member States to ensure that data centres with a total rated energy input exceeding 1 MW utilise waste heat or other waste heat recovery applications, unless it can be demonstrated that this is not technically or economically feasible.
The EED also requires an installation-level cost-benefit analysis for newly planned or substantially refurbished data centres above the 1 MW threshold. The assessment must consider, among other things, technical feasibility, cost-efficiency, local heat demand – including seasonal variations – and the possibility of connecting the data centre to a district heating network or using other waste heat recovery applications.
The European Commission has clarified that the broader obligation to utilise waste heat is not limited to new projects. In its Recommendation (EU) 2024/2395, the Commission indicated that Article 26(6) of the EED applies to operating data centres above the 1 MW threshold where waste heat is not currently being utilised, subject to the technical and economic feasibility assessment.
How is Poland proposing to implement the requirements?
Poland has not yet completed the transposition of these EED requirements. The relevant measures are currently included in the UC121 draft amendment to the Polish Energy Law, which remains in the legislative process as of 31 August 2026. Public consultations on the draft were held between 25 May and 9 June 2026.
According to the Government’s description of the proposal, data centres with a total rated energy input exceeding 1 MW would be required to recover waste heat and use it on-site or make it available, for example, to a district heating network, provided that this is technically and economically feasible.
The data centre provisions form part of a broader reform of the Polish heating sector. UC121 is also intended to introduce new criteria for efficient district heating and cooling systems and to increase the role of renewable energy and waste heat in such systems.
The proposal also includes changes to energy planning. In particular, local and regional authorities would be required to prepare local heating and cooling plans at least in municipalities with more than 45,000 inhabitants. The national comprehensive assessment of heating and cooling is also to cover the potential for the use of renewable energy and waste heat.
These measures may become relevant to data centre developments because they create a broader framework in which available sources of waste heat are to be identified and considered as part of the planning and development of local heating systems.
What does technical and economic feasibility mean?
The obligation is not absolute. Both the EED and the Polish proposal recognise that waste heat utilisation may not be technically or economically feasible.
The Commission’s guidance indicates that technical feasibility should be assessed taking into account the characteristics of the data centre and the availability of solutions which would allow waste heat to be utilised without compromising the data centre’s primary activities.
Economic feasibility is broader than simply asking whether heat can technically be supplied to another party. The Commission points to factors such as investment and operating costs, financing, risks, potential revenues or savings and a reasonable return on investment.
In practice, the outcome may therefore depend on factors such as the availability of a nearby district heating network or another heat customer, the expected demand for the heat and the cost of the infrastructure necessary to make the heat available.
This makes the feasibility assessment potentially important not only from a compliance perspective, but also at the development and due diligence stage.
Implications for data centre projects
For new developments, waste heat may increasingly need to be considered at an early stage of site selection and project design.
Developers may need to establish whether the project falls within the 1 MW threshold, whether a cost-benefit analysis is required and whether there are potential heat customers or district heating infrastructure in the surrounding area.
The regulatory framework may also require earlier engagement with municipalities and district heating operators. This could become particularly relevant if local heating and cooling plans identify data centres as potential sources of heat for existing or planned district heating systems.
Where heat is to be supplied to a third party, developers will also need to consider the contractual structure for that arrangement, including the allocation of infrastructure costs, ownership and operation of the connection and the conditions on which heat is to be supplied.
Waste heat projects are already being developed
There are already examples of this approach in Poland and elsewhere in Europe.
In Poznań, Beyond.pl and Veolia Energia Poznań are developing a project intended to recover heat generated by Beyond.pl’s data centres and supply it to the city’s district heating network.
In Finland, Fortum has commissioned large-scale heat production facilities in Espoo and Kirkkonummi as part of its cooperation with Microsoft. Waste heat from Microsoft’s data centres is expected to be integrated gradually into the district heating system from 2027 as the relevant data centre capacity is commissioned. Once fully implemented, Fortum expects the recovered heat to cover approximately 40% of annual district heating demand in the area.
Conclusion
The regulatory treatment of waste heat from data centres is becoming more specific, both at EU level and in Poland.
For data centre developers and operators, the key issue will be whether waste heat utilisation is technically and economically feasible in the circumstances of a particular project. This assessment may increasingly need to be carried out at an early stage, taking into account the location of the data centre, the availability of potential heat customers and the surrounding district heating infrastructure.
As the Polish implementation of the EED progresses, these considerations are likely to become a more regular part of data centre development, permitting and due diligence.
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Energy in Demand - Sustainable Energy - Rod Janssen 