Forty mayors from cities across four continents have joined forces to establish new standards for the development of artificial intelligence (AI) data centres, citing concerns over rising energy consumption, water usage, land shortages and environmental impacts.
The agreement, unveiled during London Climate Action Week by the climate-focused city network C40 Cities, marks the first coordinated global effort by urban leaders to manage the rapid expansion of data centres before it places excessive pressure on local infrastructure and resources.
Growing Pressure on Cities
Data centres have become critical to powering AI technologies, cloud computing and digital services. However, city leaders argue that the industry’s rapid growth is straining electricity grids, consuming large volumes of water and competing with housing developments for valuable land.
Currently, about 1,700 data centres operate within cities that are part of the C40 network, and demand is expected to increase significantly in the coming years.
The initiative emerged after city officials in Phoenix, Arizona, and Melbourne, Australia, discovered they were facing similar challenges despite being on opposite sides of the world.
Concerns Over Energy and Water Consumption
In Phoenix, one of North America’s fastest-growing data centre markets, pending projects could potentially double the metropolitan area’s electricity demand if all receive approval.
City leaders say that while data centres create jobs and attract investment, they must also contribute positively to local communities and environmental goals.
Melbourne faces a different challenge. Officials estimate that planned data centre developments could consume up to 20 billion litres of water annually—about 4% of the city’s drinking water supply. The concern comes as the city already faces growing pressure from population growth, drought conditions and rising temperatures.
New Standards for Future Developments
Under the pact, signatory cities are calling for data centres to:
- Be built on abandoned or underused land rather than displacing housing developments.
- Use renewable energy sources and battery storage systems.
- Reduce water consumption and greenhouse gas emissions.
- Capture and reuse waste heat where possible.
- Create local employment opportunities.
- Source goods and services from local businesses.
- Finance necessary infrastructure upgrades.
- Engage openly with surrounding communities before development begins.
City leaders believe these measures will ensure that technological growth benefits residents while minimizing environmental costs.
Global Participation
The agreement has been signed by cities across North America, Europe, Africa, Australia and the Middle East.
Participating cities include major urban centres in the United States, Canada, the United Kingdom, Germany, Spain, Italy, Norway, Greece, Kenya, South Africa, Sierra Leone, Côte d’Ivoire, India, Australia and Lebanon.
Notably absent are cities from Southeast Asia, despite the region experiencing some of the world’s fastest growth in data centre construction. Industry analysts estimate that more than 2,000 data centres already operate across countries such as Indonesia, Malaysia, Singapore, Thailand, Vietnam and the Philippines.
A Unified Approach
Supporters of the initiative argue that a coordinated global position is necessary because individual cities often struggle to negotiate with major technology companies on their own.
By adopting common standards, city governments hope to prevent developers from relocating projects to areas with weaker environmental and community requirements.
As demand for AI infrastructure continues to surge worldwide, the signatories say innovation must be balanced with sustainability, ensuring that economic growth does not come at the expense of local communities, public resources and long-term environmental goals.
