Milan’s data center capacity is projected to increase tenfold to 2 GW within five years

Milan’s data center capacity is expected to increase by ten times over the next five years due to increased demand for data processing and AI technology, according to the utility company, A2A, a beneficiary of the increased demand for electricity from data centers and other AI-related industries. 

According to Renato Mazzoncini, the Chief Executive Officer of Italian energy group A2A (A2.MI), the region’s data centers are projected to add around two gigawatts (GW) of new capacity, up from the current 200 megawatts (MW) installed. 

Milan becomes a data center hub

Milan is on track to become one of Europe’s fastest-growing data center hubs. Its capacity is expected to rise tenfold within the next five years. 

With the rapid expansion of digital infrastructure, the demand for reliable electricity is rising sharply and creating new opportunities for companies like A2A, Italy’s third-largest energy company by customer numbers and the largest in the Lombardy region.

“The rapid expansion of data centers, needed to drive artificial intelligence, promises to boost revenues for utilities like A2A, which will supply the electricity they need,” Mazzoncini said during an event in Milan on Friday.

All data centers in Milan currently use about 200 megawatts (MW) of electricity combined, which is a small fraction of the city’s total 1.5 gigawatts (GW) peak electricity demand. The expected increase in capacity will bring the total demand of electricity from data centers alone close to the city’s existing peak power consumption. 

More demand for renewables and thermal energy 

To accommodate the surge in electricity demand, authorities in the Lombardy region are attempting to expand both renewable and thermal power generation. According to Mazzoncini, more than 3 GW of additional thermoelectric capacity has already been built, is under construction, or has received authorization.

The CEO explained that new data centers will be connected directly to Italy’s high-voltage grid or to nearby power plants. This strategy was adopted to avoid putting pressure on the local distribution network managed by A2A. This approach is designed to ensure that the city’s broader energy needs remain stable even as data infrastructure scales up.

Mazzoncini stated that the government is backing the transition by encouraging the use of renewable energy generation, including solar and wind power. 

“The cost of electricity is converging across Europe,” Mazzoncini said regarding Italy’s higher energy prices compared with other European countries. “A solar panel or wind turbine produces at the same cost in Spain, Italy or Ireland. That’s where the world is heading.”

He added that operators can also secure electricity through power purchase agreements (PPAs) with utilities, which will provide long-term price stability and help companies meet sustainability targets.

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