Earlier this year, the German government laid out an ambitious plan: By 2030, it would double the scale of the country’s data center fleet, and quadruple the amount of compute available for running artificial intelligence models. The idea was to minimize Germany’s dependence on the United States for access to AI—a point of concern across Europe—and boost its faltering economy.

However, Germany has found that its AI ambitions are butting up against its climate commitments. EU member states have committed to cutting greenhouse gas emissions by 55 percent by the end of the decade. But policies meant to help meet that target are interfering with attempts to trigger a data center building frenzy.

As part of its broader climate commitments, the previous German administration voted through the Energy Efficiency Act in 2023. Among other things, it required all new data centers to recycle a portion of the waste heat generated by their computer equipment, ideally into nearby municipal heating systems. It seemed like a no-brainer, says Patrick Graichen, who served as a senior official at Germany’s Ministry for Economic Affairs and Energy at the time, before resigning over cronyism allegations.