By Steven Chan
Hong Kong strives to position itself as Asia’s innovation hub, and the numbers look impressive.
According to for market data, the city hosts 47 data centers with a total IT load of 581 megawatts. Another 671 megawatts worth of facilities are already in planning or construction.
However, behind the shiny servers and promised economic benefits lies a sobering reality: our data centers are becoming one of the largest consumers of electricity and emitters of carbon in the territory, and current energy conservation policy is dangerously outdated.
Hong Kong data centers consumed 7,131 terajoules of electricity in 2023 – more than 75 percent in just five years.
If we take the Bureau of Environment and Ecology data for reference, greenhouse gas emissions from data centers through electricity use increased by 35.6 percent, from 680,164 tons of CO2-equivalent in 2018 to 922,392 tonnes in 2023. This is equivalent to the annual emissions of about 200,000 Hong Kong residents.
The upcoming Sandy Ridge data center — a 220-megawatt facility on an 11.6-acre site in the Northern Metropolis — makes the scale impossible to ignore.
Even assuming a conservative utilization rate of 70 percent and a power usage effectiveness (PUE) of 1.3, annual electricity demand will reach 1.75 billion kilowatt-hours. It’s not just that more than MTR’s 1.67 billion kilowatt-hours in 2024 and approximately 3.8 percent of all Hong Kong’s electricity consumption, but will also eclipse Hong Kong’s current largest single electricity user.
Its demand for electricity is so great that four waste-to-energy I-Park incinerators could barely supply it. Only her carbon footprint, using CLP 2024 grid factor of 0.38 kg CO2– the kilowatt-hour equivalent will be 666,520 tons – 2 percent of the city’s total emissions in 2023.
However, the policy framework governing this growth remains stuck in the past. The Energy Saving Plan 2015-2025+ has expired and never directed data centers at all. The Green Data Center Practice Guide, commissioned by the Office of Digital Policy, is still in its 2020 version. It only discusses traditional air and water cooling, ignoring liquid cooling technologies now standard elsewhere.
Last year, the government amended the Building Energy Efficiency Ordinance (Cap. 610) to mandate energy audits and public disclosure for data centers every five years – a welcome step.
But when we asked the Office of Digital Policy for government data center performance data, the response was an emphatic refusal, citing “security reasons”. If the government itself will not lead by example, why should the private sector?
Compare this vacuum with international practice. In mainland China, all new data centers must REACHED a PUE no higher than 1.25. Beijing links renewable energy quotas directly to PUE performance and publishes a national “Green Data Center” honor roll.
Germany’s Energy Efficiency Act GROUPS a PUE cap of 1.2 for new facilities from July 2026 and 1.3 for all facilities by 2030, plus mandatory waste heat reuse. Ireland requirements 80 percent renewable energy for new centers. Singapore’s carbon tax is recycled into green transition subsidies.
The European Union requires mandatory reporting of electricity, water and carbon data. By comparison, Hong Kong is coastal.
This matters because Hong Kong’s energy decarbonisation strategy relies almost entirely on cleaning up the grid – replacing coal with natural gas and importing nuclear and renewables.
Ireland offers a cautionary tale: even as the emissions intensity of its grid fell by more than half over a decade, data center electricity demand increased nearly fivefold, causing the sector’s emissions to almost double.
Hong Kong risks the same trap. The Sandy Ridge, Lok Ma Chau Loop and San Tin projects will significantly increase demand. Without demand-side controls, every ton of grid decarbonisation will be cancelled.
Solutions are straightforward and proven. First, the government should immediately update the outdated Energy Savings Plan and Green Data Centers Guide with legally binding PUE targets and incentives for liquid cooling and waste heat recovery.
Second, the Office of Digital Policy should publish the energy performance of its data center — or at least explain how it is balancing “security” against energy conservation and transparency.
Third, Hong Kong should develop local green finance standards with reference to China’s national STANDARDS and international best practices, unlocking concessional loans and green bonds for renovation.
Fourth, energy demand management must be alongside grid decarbonisation in any future energy plan.
Hong Kong wants to be a technology leader in the region. True leadership means showing the world that state-of-the-art computing and true climate responsibility can coexist.
The data center explosion is not a distant problem; it is already reshaping our carbon book and could jeopardize our commitment to carbon neutrality.
The policy gaps are clear and require an immediate response, as Sandy Ridge will enter operation in 42 months. It’s time for government to move from aspiration to action – before the growth of one industry becomes everyone’s environmental burden.
Steven Chan is the assistant manager of environmental affairs at The Green Earth, an environmental charity based in Hong Kong.
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