Nearly 80% of data center capacity is at elevated risk to climate hazards like flooding and fire, study says

The Amazon Web Services IAD10 data center in Sterling, Virginia, May 31, 2026. Lexi Critchett | Bloomberg | Getty Images A huge slice of global data center capacity faces elevated risk to acute climate hazards, a study released Thursday shows. Those acute hazards, which hang over 79% of capacity, include severe climate-induced events such as flooding, extreme winds and wildfires that can disrupt operations, increase downtime and drive insurance and repair costs, according to the report by First Street, a climate risk analytics firm. First Street looked at 97 global data center markets in the report. "Most underwriting for real assets still uses historical data, but the climate is no longer behaving the way the historical record would predict," First Street CEO Matthew Eby said in a release. "As heat, drought, and water stress increase, outdated models simply don't offer a complete view of risk anymore." The study also found that just over half of all data centers globally are in markets exposed to chronic climate stress, such as extreme heat and drought, that hit energy efficiency and increase costs. While risk can be heightened by exposure to singular climate-driven events, such as strong hurricanes, it is the chronic effects of climate change that can cause the most damage, both physically and financially. Jeremy Porter, chief economist at First Street, said the backward-looking models are not correcting for climate and for all the sources of risk. …