What proposed EnEfG changes could mean for Germany’s data centre market
Proposed changes to Germany’s Energy Efficiency Act could give operators greater certainty over PUE compliance, waste heat reuse and reporting, but several details still need clarification before the reforms can provide a predictable basis for investment. As a member of the German Datacenter Association, Cundall supports the GDA’s call for regulation that improves energy efficiency while remaining proportionate, technology-neutral and deliverable in practice.
Germany remains one of Europe’s most important data centre markets, but its next phase of growth will not be defined by demand alone. It will be shaped by whether operators can secure power, navigate regulation and deliver projects with enough certainty to support long-term investment.
In our previous blogs, we explored whether Germany’s Energy Efficiency Act, known in Germany as the Energieeffizienzgesetz, or the EnEfG, had become a challenge for data centre operators and how Berlin is changing the country’s data centre geography. Together, those issues point to the same conclusion: Germany still has strong fundamentals, but its market needs a clearer path from planning to operation.
That is why the current discussion around the EnEfG matters.
Germany’s Federal Ministry for Economic Affairs and Energy has put forward a draft bill linked to the implementation of the European Energy Efficiency Directive. The GDA has responded with a position paper setting out where it supports the draft, where it wants clarification, and where it believes the proposals should go further.
Why the EnEfG matters to the market
The EnEfG goes beyond being a sustainability regulation; for data centre operators it can affect their choice of site, their cooling strategy, the way they assess investments, their ongoing operational reporting, and their future compliance.
We support the GDA’s view that the sector should continue to improve energy efficiency. These facilities are important to the wider ecosystem and our daily lives, so they should be held to high standards. However, those standards should reflect the differences between each facility and how they are designed, occupied and operated.
That distinction matters. A hyperscale campus, a colocation facility, an enterprise data centre, and an AI-only facility will all operate differently. For example, in colocation facilities, operators may not control the IT load or receive all the data needed from customers in time to meet reporting obligations.
It is here that regulation can turn into a delivery risk. When the requirements are vague, inconsistent with European standards or hard to prove, the impact goes beyond that of the compliance teams; it affects the design decisions, the procurement strategies, the lease negotiations, the certainty of the programmes, and finally whether Germany can stay competitive with respect to European markets.
What the GDA wants changed
The GDA’s position is not a rejection of the draft reforms. It is a practical response to them.
One of the most important changes relates to scope. The draft would define an in-scope data centre using an installed IT power threshold of 500kW rather than 300 kW. This could remove some smaller facilities from parts of the regulatory framework, although the scope must be applied consistently across the Act.
Power usage effectiveness (PUE) is another issue. The draft proposes amendments to the PUE framework for data centres, including revised requirements for existing facilities and changes affecting the compliance pathway for new developments. The GDA views the moderation of these values as appropriate because PUE is affected by redundancy requirements, power availability, and site-specific conditions. In practice, facilities are not always fully utilised, particularly as campuses become online, and operators need spare capacity to maintain resilience.
The proposed design PUE mechanism is therefore important. The draft suggests that compliance could be demonstrated where a data centre would meet the required PUE at 80% IT utilisation. For colocation and co-hosting, this could help reflect the reality that operators do not always control customer IT utilisation. However, the GDA is asking for a clearer methodology, stronger technical justification for the 80% threshold and consideration of whether the mechanism should apply to existing facilities as well as new ones.
Waste heat is another major area.
The draft would allow internally reused energy to be credited for the first time, which the GDA supports. It also introduces more practical exceptions where heat networks or suitable customers are not available. This is important because waste heat reuse depends on more than the data centre itself. A facility can produce heat and provide an interface, but successful reuse also depends on heat networks, heat demand, timing, commercial agreements and municipal planning.
The GDA’s argument is simple: waste heat should remain important, but it should be treated as an infrastructure project rather than a rigid obligation placed on the data centre operator. In our view, allowing waste heat to be reused internally, including in administration buildings or security facilities, is a pragmatic step towards recognising the different ways in which recovered heat can be used.
Power sits alongside these regulatory questions. In its paper on Hesse, the GDA highlights that data centres require high-availability power supplies, clear timelines, resilient connection conditions and predictable cost risks. It also points to long grid connection timelines for new data centre projects in Germany. For operators, this reinforces the need to assess sites against infrastructure readiness rather than land availability alone.
What this means for operators
For operators considering Germany, the proposed reforms could be helpful if they create a more practical and predictable framework; nevertheless, they will not eliminate the need for careful technical advice throughout all stages of the projects.
Proposed changes, including stronger confidentiality protection and lesser reduced disclosure of commercially sensitive operational data, could make it easier for operators to meet their reporting obligations.
PUE will need to be modelled with operational reality in mind, not treated as a simple headline figure. Design teams will need to understand how redundancy, phasing, utilisation and cooling strategy affect compliance over time.
Waste heat will also need to be assessed much earlier. The question is not only whether heat can be captured, but whether there is a viable route to use it. That means testing heat network proximity, temperature levels, customer demand, phasing, responsibilities and commercial delivery.
Power strategy will always remain of fundamental importance. Although Frankfurt is still Germany's main data centre hub, growing constraints are leading to increased interest in other locations, such as Berlin and the wider secondary markets. While these alternative locations might offer some opportunities, such opportunities will only arise where there is a match between grid capacity, connection timelines, fibre, water, heat reuse and the planning processes.
This is where Cundall’s role becomes valuable. The challenge is no longer simply designing an efficient building. It is bringing together energy strategy, multidisciplinary design, regulatory interpretation, site assessment and long-term operational planning so that decisions made at the start of a project do not become constraints later.
Looking forward
Germany has the market demand, connectivity and strategic importance to remain one of Europe’s leading data centre locations. But the next phase of growth needs regulation and infrastructure to move in step.
The GDA’s response to the proposed EnEfG reforms makes an important point. Higher efficiency standards and sustainable growth are not in conflict with competitiveness, provided the rules are clear, proportionate and practical to implement. It is encouraging to learn of the German’s Federal Cabinet adaptation of the proposed changes in June 2026, we will be following further the ongoing parliamentary legislative process and future implementation of the revised Act. Subject to the parliamentary timetable, the amendments could come into force in late 2026 or early 2027, with several of the key data centre compliance dates still aligning to July 2027 and July 2030.
For data centre operators, the lesson is clear. In Germany, regulatory strategy, power availability, waste heat potential and technical design now need to be considered together from the earliest stages of site selection.
To understand how proposed EnEfG changes and Germany’s evolving data centre market could affect your next project, speak to a member of Cundall’s data centre team.
