Khazna Targets 100% Carbon-Free Cooling as AI Data Center Demand Grows

Khazna Data Centers has published its first standalone ESG Report, setting a formal sustainability baseline as it expands internationally and demand for AI infrastructure accelerates. The company aims to cover 50% of its mechanical cooling load with carbon-free electricity by 2030 and 100% by 2035, up from 27% in 2025. The report also introduces companywide greenhouse gas accounting, resource-efficiency targets and new metrics on water, waste and operational safety.

The UAE-based data center operator said its 2025 disclosure is intended to establish the systems and governance needed for annual ESG reporting. The report has been prepared with reference to GRI Standards, while greenhouse gas emissions have been calculated using the GHG Protocol Corporate Accounting and Reporting Standard.

 

Cooling Is the First Major Decarbonisation Target

 

Khazna’s clean electricity target currently applies specifically to mechanical cooling load, one of the largest areas under its direct operational control. In 2025, 27% of electricity used for cooling was covered by carbon-free electricity through onsite solar generation and certified clean energy instruments.

The company plans to increase that share to 50% by 2030 and 100% by 2035, while developing a wider decarbonisation roadmap covering Scope 1, Scope 2 and relevant Scope 3 emissions. Khazna also formalised its greenhouse gas accounting methodology in 2025 and completed its first companywide emissions inventory.

 

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Efficiency Standards Are Being Built Into New Facilities

 

Khazna is positioning energy efficiency as part of facility design rather than a separate sustainability programme. New data centers in the Gulf Cooperation Council are being designed to operate at power usage effectiveness values of 1.5 or below, while facilities in other markets will target lower PUE levels where local operating conditions allow.

The company said modular construction, high-efficiency cooling and real-time energy management will support those targets. Operating in the UAE’s high-temperature climate has also shaped its approach to cooling, resilience and water use, which are becoming increasingly important considerations as AI-driven data center capacity grows.

 

Water and Waste Metrics Add Detail to the Baseline

 

Khazna reported that 19.8% of its cooling water requirements were met using recycled water from treated sewage effluent in 2025. The figure provides an early benchmark for water stewardship in a region where both cooling demand and water scarcity are significant operational considerations.

The company also reported that its DXB8 facility achieved Zero Waste Certification after an independent audit verified a 99.55% waste diversion rate from landfill over a 12-month period. These metrics give the report more substance than a purely policy-based ESG disclosure and create measurable reference points for future reporting.

 

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AI Growth Is Raising Expectations for Data Center Sustainability

 

Khazna is publishing the report as AI workloads drive rapid growth in electricity-intensive digital infrastructure. Data center operators increasingly face pressure from customers, regulators and investors to demonstrate how new capacity will affect power demand, emissions, water use and local infrastructure.

"Demand for data center capacity is accelerating, driven by unprecedented growth in AI. That growth brings opportunity, but it also brings expectations," said Hassan Alnaqbi, CEO of Khazna Data Centers. "Our industry has a duty to move faster on ESG: to reduce environmental impact, strengthen safety and working conditions, and be more consistent and credible in how we measure and report progress."

 

Safety and Workforce Metrics Are Also Being Formalised

 

The report extends beyond environmental performance. Khazna recorded a total lost time injury frequency rate of 0.097 across 20.6 million working hours in 2025, with zero lost time injuries at operational sites. The company also delivered more than 5,000 hours of training and continued community engagement and volunteering programmes.

"As we expand internationally, transparency becomes part of our licence to operate," Alnaqbi said. "Our responsibility is to be clear about the impacts of our industry, disciplined in how we manage them, and committed to improving performance over time."

 

The Baseline Now Creates a Test for Future Progress

 

The value of Khazna’s first ESG report lies in establishing measurable baselines across energy, water, waste and safety before the company expands further. The 2030 and 2035 clean electricity targets are especially important because they create a visible pathway for one of the most energy-intensive parts of data center operations.

The next test will be whether Khazna can extend progress beyond mechanical cooling into a broader decarbonisation strategy covering its full operational and value-chain footprint. Annual reporting, stronger data quality and eventual assurance will determine how clearly the company can demonstrate improvement as its AI-focused data center portfolio grows.

 

Source: Khazna Data Centers