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How US tech is using a data center pact to lobby Brussels

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U.S. tech giants are using an industry pact aimed at greening data centers to push their views on broader tech legislation in Brussels, according to two European members of the initiative.

The Climate Neutral Data Center Pact — a voluntary industry agreement struck with the European Commission in 2021 — commits industry players to reducing data centers’ high environmental and carbon footprints. It also allows them to avoid stricter regulation from Brussels, beyond existing requirements.

Members of the pact include Google, Microsoft, IBM, Intel and Amazon’s Web Services. They’ve committed to tackle energy, resource and water use at their data centers, and to power them using only renewable energy by 2030.

But a manager from a European member organization said large U.S. data firms are instead using the pact as a lobbying vehicle.

“It’s never really said, but their objective is to unite the actors of the industry and to be able to speak on its behalf,” the manager said, speaking on the condition of anonymity because of the sensitivity of the discussions. The manager described “the Americans” as having the “upper hand” in the pact’s activities.

An industry official at a second European pact member, who also requested not to be named, agreed the initiative is “under the influence” of U.S.-based tech companies and “seems to be more and more considered as a tool to elaborate common position papers or lines to take for the whole sector, with respect to [EU] legislations under negotiation.”

The lobbying tactic is “a well-practiced tactic to try to avoid tougher regulation,” said Pascoe Sabido, a campaigner with the NGO Corporate Europe Observatory, adding that voluntary industry agreements are often used as “fronts” for informal lobbying.

Industry players representing U.S. tech giants dismissed concerns that the pact is veering off course.

Ben Maynard, director of communication at Cloud Infrastructure Services Providers in Europe (CISPE) — which has Amazon as a member — stressed there was nothing wrong with having big players involved in the pact. They “are leaders in developing technologies that allow data centers to be sustainable,” Maynard said, adding that each company gets one vote in the pact’s governing groups, regardless of its size.

Google and Microsoft didn’t reply to a request for comments. IBM and Amazon Web Services declined to comment.

Blurred lines

The pact, which is not considered a lobbying organization, doesn’t appear on the EU transparency register for lobbying activities. Only one of the signatories — OVHcloud — has listed the initiative as part of its activities “covered by the register.”

Some members see that as a problem, arguing that companies are blurring lines by using the pact to agree common positions and lobby EU institutions on wider issues.

The pact set up an internal “policy work group” to brainstorm and coordinate positions on key EU climate legislation, including the Energy Efficiency Directive, the Renewable Energy Directive and the EU taxonomy for green investments.

That’s not the stated goal of the pact, according to the manager at a European pact member cited above, who said the intention was to allow members and the Commission to “align” on energy, water use and circularity performance in data centers.

“We were quite surprised because there was a real positioning, a real political strategy that was being put in place” for negotiations on the Energy Efficiency Directive, the manager added.

The pact put together a joint position paper on the EU’s Energy Efficiency Directive that could be used by pact signatories to answer the Commission’s public consultation “with common language and common objectives,” according to email exchanges seen by POLITICO.

Maynard argued that “any association is going to discuss policy.”

“This is about making sure we’re informed about what is happening and that we, as an industry, can make sure that the right technical input is provided [to policymakers],” he said, adding: “We don’t proactively lobby … but we offer to discuss.”

Maynard said he found it “strange” that “individual members seem to think that this isn’t what they signed up to,” arguing it’s not forbidden for the pact to have “a view on policy.”

Lack of ambition

According to the two European member organizations’ officials, the focus on lobbying Brussels caused its core work on sustainability to be watered down.

The pact’s targets on the use of water in data centers “are not at all difficult to reach,” the manager at the first pact member said. “The already virtuous actors will reach them without any problem and those who are still far away won’t have many problems to reach them either.”

Daan Terpstra, CEO of the Sustainable Digital Infrastructure Alliance — which is not a pact member — agreed that the pact’s work so far has amounted to a “continuation of the status quo” and may even be redundant, given existing metrics like the Life-Cycle Assessment tool.

But Maynard disagreed: “We think we are doing a good job and are on track with what we set out alongside the Commission,” he said.

For those pushing for higher standards of energy use in the cloud sector, Europe’s initiative is likely to fail its stated environmental goals.

“Don’t count on the big American players to put constraints on themselves,” said the unnamed manager. “It won’t work.”

This article is part of POLITICO Pro

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