A data center turns almost all the electricity it uses into heat. For a long time, that heat was released into the air. Since 1 January 2026, a French data center above 1 MW must reuse it, unless it can show this is not feasible. For a town, a group of municipalities or a district heating operator, this is a resource to negotiate early, while the project is taking shape, not once the building is up.
DOES YOUR SITUATION LOOK LIKE ONE OF THESE?
1. WHAT THE LAW SAYS SINCE 2026
The obligation. The law of 30 April 2025, which transposes the EU Energy Efficiency Directive, created article L. 236-2 of the French Energy Code: data centers with an installed capacity of at least 1 MW must reuse their waste heat. A decree of 29 December 2025 sets out the details, in force since 1 January 2026.
The criterion. A data center is deemed compliant if its ERF (Energy Reuse Factor, the share of energy reused outside the site) is at least 0.20. A ministerial order may raise this to 0.40.
The exemption. The operator can be exempted if a cost-benefit analysis shows that technical and economic conditions do not allow it. It must then reuse whatever share remains acceptable. The analysis must accompany the building permit application. For permits filed before 1 January 2026, it must be submitted by 1 October 2027.
Sanctions. A formal notice, then an administrative fine of up to €50,000 per data center, with possible publication. On top of this, from 500 kW, the site's energy performance must be reported each year by 15 May to the European database.
What the law does not do. Heat reuse is not a condition for granting the building permit. A Senate proposal went that way, but the provision was dropped. In practice, a file that addresses the issue, with an identified heat user, is better received.
2. WHY IT IS HARDER THAN IT LOOKS
Temperature. Heat from an air-cooled data center often comes out at around 25 to 35 °C, somewhat warmer with liquid cooling of AI servers. That is too cold for most existing district heating networks, which run at higher temperatures. Heat pumps are needed to raise it, and they use electricity themselves, or the network must be designed for low temperatures.
Seasons. A data center produces heat all year round, fairly steadily. A heat network mostly needs it in winter. Without summer uses (hot water, swimming pools, industrial processes) or storage, part of the heat is still lost.
Distance. Every kilometre of pipe is expensive. A data center built far from any heat user will struggle to justify an ERF of 0.20, and the cost-benefit analysis will show it.
Who pays, and for how long. The heat pump, the heat exchanger, the pipe: someone has to invest. The heat supply contract must last as long as the network's payback period, while a data center can change operator or customers. And if the data center stops, the network must still be able to heat.
3. THE MILAN EXAMPLE
In Milan, the utility A2A commissioned Arup to study how future data centers could fit into its energy system. The study identified suitable areas for data centers, overlaid them with A2A's networks and power plants, then examined three areas in detail. The reported result: a 154 km extension of the district heating network could recover about 674 GWh of heat a year, enough to heat more than 6.6 million m² of housing.
What matters is not the number but the approach. The utility did not wait for a developer to knock on its door. It looked for where data centers would add the most value to its network, and it prepared a permitting framework for future projects. The study also looked at how its own power plants could supply data centers where the electricity grid is constrained.
In France, ADEME estimated the recoverable heat from data centers at 1.8 TWh in 2024, and between 4 and 13 TWh by 2035. The question is no longer whether there is heat to recover, but who organises to recover it.
4. THE QUESTIONS TO ASK A PROJECT
A local authority or heat network operator facing a new data center can ask, from the first meetings:
What profile: steady all year, or changing as the site ramps up?
What ramp-up schedule, phase by phase?
Has the cost-benefit analysis been done, and on what distance and heat-user assumptions?
Who pays for the heat pump, the exchanger and the pipe to the network?
How long is the commitment, and what happens if the site changes operator or closes?
Does the site keep space for the exchanger and the connection to the heat network?
These questions go together with those on the electricity grid and on water. A data center that reuses its heat with heat pumps uses a little more electricity, and local grid capacity often remains the first constraint. See our support for local authorities.
5. PLAN AHEAD RATHER THAN REACT
The best position for a local authority is not to wait for the permit application. It is to know in advance where a data center would be useful to its area: near an existing or planned heat network, near buildings that use heat all year, where the grid can follow. That mapping work is what Milan did. It makes it easier to say yes quickly to the right projects, and to explain to residents what the area gains.
For a developer, the reverse applies: coming with an identified heat user and a serious cost-benefit analysis is now one of the strongest arguments with elected officials. See also data center permits in France.
Sources: Energy Efficiency Directive (EU) 2023/1791; French law no. 2025-391 of 30 April 2025 (DDADUE); French Energy Code, articles L. 233-5, L. 236-1, L. 236-2, L. 236-3 and R. 237-1 et seq.; decree no. 2025-1382 of 29 December 2025; French Planning Code, article R. 431-16; ADEME, January 2026, as reported by DCmag on 5 May 2026; Arup, study for A2A Calore e Servizi (Milan), 2026. Implementing orders (distance threshold, possible increase of the ERF threshold) should be checked in their current version. This article is general information, not legal advice.
FREQUENTLY ASKED QUESTIONS
Must a French data center reuse its waste heat?
Yes, since 1 January 2026, if its installed capacity is at least 1 MW (article L. 236-2 of the French Energy Code). It is deemed compliant with an ERF of at least 0.20. It can be exempted from that threshold if a cost-benefit analysis shows it is not technically and economically feasible.
What is the ERF?
The Energy Reuse Factor measures the share of the energy used by the data center that is reused outside the site, for example in a heat network. An ERF of 0.20 means 20% of the energy is reused.
Is heat reuse a condition for the building permit?
No. The cost-benefit analysis must accompany the permit application, but heat reuse is not a condition for granting it. A file that plans it concretely is, however, better received by elected officials.
Can a local authority require connection to its heat network?
Not directly through the permit. It can negotiate early, steer projects towards areas near a network, and rely on Energy Code obligations and, where relevant, the classification of its heat network. Legal advice is recommended case by case.