As the demand for data centres required to support artificial intelligence systems exponentially rises, the environmental effects of such data centres are becoming increasingly difficult to ignore. Data centres require huge amounts of power and water to run, with some data centres consuming as much power and water as an entire city. On top of this, large amounts of land are required to house the data centres, which run 24 hours a day, 7 days a week, producing a constant stream of noise, air and light pollution.

To avoid further damage to the planet, there is a growing need to find new ways to support data centres using less power, less water, and with less disturbance to the surrounding environment.

"Anything you can do in a terrestrial data center, I’m expecting to be able to be done in space." Starcloud CEO Philip Johnston

Why space?

Most of the energy consumed by data centres goes towards running the servers, however a significant portion of the energy is used for cooling the various components to allow them to function effectively. Conventional data centres use up to 40% of their total energy on cooling alone.

Cooling systems in conventional data centres also require vast amounts of water. As the number of data centres is rapidly growing, data centre hubs are moving to rural areas where land is cheap and readily available, such as desert areas in Arizona and Nevada. The low humidity of the desert is beneficial for the lifetime of the electrical equipment and increases the effectiveness of evaporative cooling, and the cool desert nights further help to dissipate heat from the components. However, large amounts of water are still required to cool the components, which may put further strain on drought-prone regions.

Other locations have been considered, where the environment provides a natural heat sink. One of these locations is under the sea, where 40–60% reductions in cooling power can be achieved through passive heat transfer to the surrounding water. However, using the surrounding water as a natural heat sink undeniably has an effect on the ocean environment. The constant noise, light and water pollution from underwater data centres may potentially cause further damage to already struggling marine ecosystems.

Space appears to be an exciting possibility; the environment is extremely cold, concerns over availability of resources such as water and land are effectively eliminated, and green energy (solar power) can be used to power the servers.

The benefits 

One of the main benefits of locating data centres in space is that it is extremely cold (around -270 °C), providing an effective natural heat sink for the electrical equipment. Through the use of passive cooling instead of active cooling, the energy usage of space data centres can be dramatically reduced, without requiring any water.  

In addition, solar energy (which may be used to power the servers) is more effectively harnessed in space than on Earth. The solar panels of a space data centre will experience no day and night cycle, no seasons, no weather, and the sun’s rays will not be disrupted by the presence of an atmosphere. For these reasons, a solar array in space can generate over five times the energy as the same array on Earth.

Another benefit of locating data centres in space is that there is no known life that could be affected by the pollution produced, and there is no concern over land usage. As a result of these factors, a space data centre is likely to produce significantly less greenhouse gas emissions than a data centre located on Earth, as concluded by a recent study by the European Commission.

As well as the environmental effects, there are other beneficial effects of locating data centres in space, such as enhanced security. With the use of space data centres, data will not need to be routed through terrestrial networks: it can be transmitted directly from the data centre in space to the ground location. The data centre is effectively harder to access, and therefore harder to hack and physically disrupt.

Further considerations 

Putting data centres in space may appear to solve some of the problems faced on Earth, but there are obvious questions over how to get them there. While data centres in space (once up and running) are likely to produce less carbon emissions than Earth data centres, significant amounts of energy are required to launch them into orbit, not to mention the cost.

To combat this, data centres can be designed and launched in a modular fashion and assembled in space. However, costs and emissions associated with rocket launches still remain significant, with each kilogram that is sent into space costing thousands of pounds alongside the environmental impact.  

There are also considerations around potential damage from collisions with the ever-growing amount of space debris, as well as the cost and complexity of repair missions. While robotics and automation can assist in remote repairs from Earth, there is currently a limit as to the kind of repairs that can be done remotely.

As described in Starcloud’s White Paper of September 2024, collisions can be avoided with the use of state-of-the-art space-object tracking systems, and by ensuring highly responsive spacecraft manoeuvrability. Damage by orbital debris can also be mitigated by placing the data centres in underutilised orbits, where there are fewer objects for them to interact with. In addition, as the data centres will be powered using solar energy, a large portion of their surface area will be solar panels, which are not significantly affected by collisions with small debris.

That said, locating data centres in space (and getting them there) will expose them to a wide range of space-related risks and conditions which are not faced on Earth, such as the effects of space radiation and the extreme conditions experienced by components during launch.

There is also the aspect of the speed of data transmission. While locating data centres in space may provide enhanced security, the data has to travel further. This causes an increase in data transmission times and an increase in latency, although this may only be a minor effect on the millisecond scale.

Lastly, data sovereignty is also an important consideration: on Earth, digital data is subject to the laws and governance structures of the country or region where it is collected, stored, or processed. According to the 1967 Outer Space Treaty, no nation can claim sovereignty over any part of space, and nations instead retain jurisdiction and control over objects (that is, spacecraft) which they register, regardless of where they are in space. There is, therefore, currently jurisdictional ambiguity and a lack of regulation surrounding the collection, storage and processing of data in space.

Current projects 

As of 2026, there are no commercial, full-scale data centres operating in space.

In January 2026, SpaceX filed a request with the US Federal Communications Commission (FCC) to launch one million satellites into Earth’s orbit to be used as data centres for AI computing. There are (unsurprisingly) doubts as to the viability of this project.

However, there are currently smaller scale, experimental edge-computing data units currently in orbit. In late 2025, Axiom Space deployed its Data Center Unit-1 (AxDCU-1) on the International Space Station (ISS), and Starcloud (formerly known as Lumen Orbit) launched its data centre prototype, Starcloud-1, with both companies having further launches planned in the future. Despite the obvious technical and financial challenges associated with putting data centres in space, ambitions appear to be high.

The technology of placing satellites into orbit is well understood but this new technology, deployed in space, creates a range of technical complications. This creates a significant opportunity for businesses which may find their technology becomes critical to the effective and reliable operation of technologies such as AI data centres in space. Those companies are likely to need to consider how IP can protect their investment and technologies in a new marketplace.

Further advice can be obtained by contacting D Young & Co.

Useful links

• International Energy Agency (IEA), Energy demand from AI: dycip.com/iea-energy-ai
• CNBC, “Greetings, earthlings” - Nvidia-backed Starcloud trains first AI model in space as orbital data center race heats up: dycip.com/cnbc-starcloud-data
• Starcloud: dycip.com/starcloud
• BBC, The plans to put data centres in orbit and on the Moon: dycip.com/bbc-data-moon
• United Nations Office for Outer Space Affairs, 2222 (XX1)/ Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies, Article VIII: dycip.com/un-space-treaty-art8
• Rest of World, Data centers are racing to space - and regulation can’t keep up: dycip.com/data-centers-regulation
• Axiom Space, Orbital Data Centers: dycip.com/axiom-data-centers
• SpaceX applies to launch a million satellites into orbit: dycip.com/bbc-spacex-satellites
• Data Reportal, Digital around the world: dycip.com/data-report-mobile-global
• We are social, Digital 2026 global overview: dycip.com/digital-global-overview