The global race to build artificial intelligence infrastructure is accelerating at an unprecedented pace. Governments and technology companies are spending billions of dollars to build new data centres that will power everything from AI chatbots and cloud computing to advanced scientific research and digital services. But a new report suggests that the future of this infrastructure is at risk because of a challenge that can’t be solved by technology alone: climate change.
According to the 2026 Global Analysis of Planned Data Centres for Physical Climate Risk and Resilience by climate risk analytics firm XDI, several of the world’s fastest-growing data centre markets, including India, are facing significant climate-related risks that could disrupt operations, increase costs and affect long-term reliability.
Researchers studied 2,595 planned data centres worldwide and evaluated their physical vulnerability to climate-related hazards like extreme heat, flooding and other environmental threats. The findings paint a concerning picture for digital infrastructure going forward.
India has emerged as one of the countries with the highest operational risks from extreme heat. Along with Brazil, Mexico, Indonesia and Spain, over 75 percent of the data centre projects studied are already classified as high risk. With global temperatures going up, these risks are expected to be even more serious in the next decades.
Extreme heat is not only an environmental issue for data centres. These facilities need huge cooling systems to keep servers running efficiently. High temperatures can lead to higher energy consumption, lower operational efficiency and, if cooling systems are overloaded, even outages. Given the high computing power required for AI applications, reliable cooling is one of the industry’s biggest challenges.
The report also emphasizes that climate risks are not just in hot regions. France, Canada and Australia may see some of the fastest increases in climate-related operational disruptions in the next decades. Europe, for example, has very few high-risk planned facilities, but average damage risks are projected to increase by nearly 289 percent by the end of the century.
The United States is a big concern too. Almost half of the world’s high-risk planned data centres are located there, with 69 facilities already classified as high risk. States including Oklahoma, Louisiana, Kansas and New York were identified as emerging climate-risk hotspots.
The research found that Southeast Asia, East Asia and South Asia have the highest number of climate-vulnerable data centres. Around 20 percent of planned facilities in Southeast Asia are considered high risk, compared with 13 percent in East Asia and 12 percent in South Asia. Such risks could triple or even increase significantly before the end of the century.
The findings are emerging at a time when demand for AI infrastructure is exploding globally. Big tech companies are spending billions to expand data centre networks, buoyed by the rapid growth of artificial intelligence services. But climate resilience needs to be a focal point of all future planning, the study says.
Experts say that careful site selection, better engineering standards, cooling technologies and resilience investments should be made before the start of construction to significantly reduce climate risks.
Dr. Karl Mallon, founder and head of Science and Technology at XDI, said the conversation about AI infrastructure can no longer be solely about electricity demand and water consumption. Investors and policymakers, in other words, need to ask if future facilities will be operational, insurable and economically viable throughout their lifespan.
A few years into the AI revolution, the report also serves as a reminder that digital infrastructure may be built for the future but it is largely dependent on the physical environment around it. For countries like India that are investing heavily in AI-driven growth, climate resilience could be just as important as technological innovation itself.
