Summary Under the proposed Cloud and AI Development Act (CADA), Member States cannot designate "data centre acceleration zones" without enforcing strict, harmonised sustainability standards. Article 11(1) of the proposal explicitly mandates that when setting sustainability requirements for data centres deployed in these zones, Member States shall use the key performance indicators (KPIs) specified in Commission Delegated Regulation (EU) 2024/1364. These KPIs are defined in Annex II, points (a) to (n) of that Delegated Regulation, which was adopted pursuant to the Energy Efficiency Directive (Directive (EU) 2023/1791). This ensures that the rapid deployment of compute capacity does not come at the expense of the EU's climate goals, creating a unified, measurable framework for energy efficiency, water usage, and carbon intensity across the Union.

Detail

The Cloud and AI Development Act (CADA), as proposed in COM(2026) 502 final, seeks to address the critical shortage of computing capacity in the European Union. A primary mechanism for achieving this is the creation of data centre acceleration zones. These are specific geographic areas designated by Member States where administrative and permitting processes are streamlined to facilitate the rapid construction and operation of data centres. However, the proposal is clear: acceleration is not a deregulation of environmental standards. Instead, it is a targeted acceleration of compliant infrastructure.

The Legal Mandate: Article 11(1)

The core of the sustainability requirement is found in Article 11(1) of the CADA proposal. This article establishes a direct legal link between the new acceleration zones and the existing EU regulatory framework for data centre energy efficiency. The text states:

"When setting sustainability requirements for data centres deployed in acceleration zones, Member States shall use the key performance indicators specified in Commission Delegated Regulation (EU) 2024/1364 pursuant to Directive (EU) 2023/1791 under Annex II, from (a) to (n)."

This provision is critical for three reasons:

  1. Mandatory Application: The use of the word "shall" indicates that Member States have no discretion to invent their own metrics or rely on voluntary codes of conduct. They must adopt the specific KPIs listed in the Delegated Regulation.
  2. Harmonisation: By referencing a single Delegated Regulation, CADA ensures that a data centre in an acceleration zone in Finland is measured against the exact same technical standards as one in Spain or Germany. This prevents regulatory fragmentation and ensures a level playing field.
  3. Dynamic Alignment: The reference to Delegated Regulation (EU) 2024/1364 means that if the Commission updates the KPIs in the future (as is common with delegated acts), the requirements for acceleration zones would automatically align with the latest technical standards without needing to amend the primary CADA legislation.

The Source Framework: Delegated Regulation (EU) 2024/1364 and the Energy Efficiency Directive

To understand the specific requirements, one must look at the referenced legislation. Directive (EU) 2023/1791 (the recast Energy Efficiency Directive) provided the legal basis for the Commission to establish a common Union rating scheme for data centres. Acting on this, the Commission adopted Delegated Regulation (EU) 2024/1364.

This Delegated Regulation defines the specific Key Performance Indicators (KPIs) that data centre operators must calculate and report. Article 11(1) of CADA specifically points to Annex II, points (a) through (n) of this Delegated Regulation. While the full text of the Delegated Regulation contains the precise mathematical formulas and definitions, the KPIs in this range generally cover the full spectrum of environmental impact, including:

  • Energy Efficiency: Metrics such as Power Usage Effectiveness (PUE), which measures the ratio of total facility energy to IT equipment energy, and Energy Reuse Effectiveness (ERE).
  • Water Efficiency: Metrics such as Water Usage Effectiveness (WUE), which tracks water consumption relative to the IT load, a critical factor as data centres increasingly rely on evaporative cooling.
  • Carbon Footprint: Indicators measuring Carbon Usage Effectiveness (CUE) and the carbon intensity of the energy consumed, distinguishing between location-based and market-based emissions.
  • Waste Heat Reuse: Metrics evaluating the percentage of waste heat recovered and supplied to district heating networks or other industrial processes.
  • Resource Efficiency: Indicators related to the reuse of materials and the circular economy aspects of data centre construction and operation.

By mandating these specific indicators, CADA ensures that "sustainability" is not a marketing term but a quantifiable, auditable set of engineering and operational standards.

The Strategic Rationale: Balancing Speed and Green Goals

The inclusion of Article 11(1) addresses a specific policy tension identified in the CADA explanatory memorandum. The EU faces a "compute capacity gap" that threatens its competitiveness and strategic autonomy. The memorandum notes that the "lack of data centre capacity in the EU forces European enterprises to route critical workloads through foreign hyperscaler infrastructure." To close this gap, the EU must triple its data centre capacity within the next five to seven years.

However, the memorandum also warns that rapid deployment must not create "negative impacts, such as energy supply stress, adverse environmental impacts and lost opportunities." Without a binding sustainability framework, acceleration zones could theoretically become "brownfield" zones where environmental standards are lowered to attract investment. Article 11(1) prevents this "race to the bottom."

Furthermore, Article 10 of CADA requires Member States to consider the "ability of the site or area to function sustainably" when designating an acceleration zone. Article 11 then ensures that once designated, the operation of data centres within that zone adheres to the highest available EU standards. This creates a "green acceleration" model: the EU speeds up the permitting process for projects that are demonstrably efficient, rather than slowing down the entire market with a one-size-fits-all approach that ignores local grid capabilities or innovation potential.

Interaction with Other CADA Provisions

The sustainability requirements in Article 11(1) are part of a broader ecosystem of measures in CADA:

  • Article 13 facilitates the permitting process for projects in acceleration zones, but this facilitation is contingent on the project meeting the Article 11 sustainability criteria.
  • Article 14 allows the Commission to designate specific "data centre strategic projects." While these projects may receive additional support, they must still adhere to the fundamental sustainability KPIs if they are located within an acceleration zone.
  • Article 15 tasks the Commission with monitoring the "capacity gap." The data collected on KPIs from acceleration zones will feed into this monitoring, allowing the Commission to assess whether the EU is expanding capacity while simultaneously improving its overall energy efficiency profile.

What this means for you

For stakeholders involved in the cloud and data centre ecosystem, the implications of Article 11(1) are significant and immediate.

For Data Centre Operators and Investors

If you are planning to build or operate a data centre in a designated acceleration zone, you must integrate the KPIs from Delegated Regulation (EU) 2024/1364 into your project design from day one.

  • Design Phase: Your architectural and engineering teams must model the facility to ensure it meets the specific thresholds for PUE, WUE, and carbon intensity defined in Annex II (a)-(n).
  • Compliance Strategy: You will need to establish robust data collection and reporting mechanisms. The KPIs are not static; they require continuous monitoring. Failure to demonstrate compliance could result in the loss of "acceleration zone" status, meaning your project would face standard (and likely slower) permitting procedures.
  • Technology Selection: The requirements may drive the adoption of advanced cooling technologies (e.g., liquid cooling, free cooling), waste heat recovery systems, and on-site renewable energy generation to meet the strict KPI targets.

For Public Authorities and Member States

Member States are the primary actors responsible for implementing Article 11(1).

  • Designation Criteria: When identifying potential acceleration zones, authorities must verify that the local grid and infrastructure can support data centres meeting the Delegated Regulation's KPIs.
  • Monitoring and Enforcement: National competent authorities will need to verify that operators within the zones are actually using the specified KPIs. This may require new reporting templates or integration with existing national energy efficiency registries.
  • Policy Coherence: National strategies (required under Article 7) must align with these sustainability requirements. A national strategy that promotes data centre growth without addressing the KPIs of Article 11 would be inconsistent with CADA.

For Public Sector Procurement Officers

While Article 11(1) primarily targets the deployment of infrastructure, it indirectly affects procurement.

  • Sustainable Procurement: As public bodies are required to procure cloud services that meet certain sovereignty levels (under Article 30), the sustainability profile of the underlying data centre may become a relevant quality criterion.
  • Risk Assessment: Procuring services from data centres that do not meet the Article 11 KPIs could expose public bodies to reputational risk, especially as the EU moves towards stricter environmental reporting requirements.

Common misconceptions

"Acceleration zones allow data centres to bypass environmental rules." This is a dangerous misconception. Article 11(1) explicitly tightens the link to environmental rules by mandating the use of the specific, high-standard KPIs from Delegated Regulation (EU) 2024/1364. Acceleration refers to the speed of permitting, not the relaxation of standards.

"CADA creates a new, separate set of sustainability metrics." CADA does not invent new metrics. It acts as a "bridge" or "reference" law. It points directly to the existing Delegated Regulation (EU) 2024/1364 and the Energy Efficiency Directive (2023/1791). The KPIs (a)-(n) are those already established in EU law, ensuring continuity and technical accuracy.

"Only new data centres need to comply." While the primary focus of acceleration zones is on new deployment, the requirement applies to any data centre "deployed in acceleration zones." If an existing facility is retrofitted or expanded within a designated zone, it would likely be subject to the same sustainability requirements to maintain its status.

"Member States can choose which KPIs to apply." No. Article 11(1) is prescriptive: Member States "shall use the key performance indicators... under Annex II, from (a) to (n)." There is no optionality to pick and choose; the full set of indicators in that range must be applied.

Related

This is general information about a draft EU regulation, not legal advice.