Turning the earth into a thermal battery for data center cooling

Posted: October 06, 2025

Earlier this year, scientists at NREL outlined a powerful method to improve cooling, save water and reduce the amount of energy required to run a data center. Called Cold Underground Thermal Energy Storage (UTES), the technology harnesses the earth’s ability to act like a thermal battery.   

As has been widely reported, data centers use a tremendous amount of energy. An AI-focused data center can consume the same amount of energy as 100,000 homes in a year, and some new hyperscalers under construction today are predicted to use 20 times as much. Some of that energy goes to powering the servers, but a lot of it is also used for cooling—up to 40 percent. Cooling loads are highest during warmer periods like summer, which is also when many people run AC units to cool their homes and businesses, creating significant load on the grid. Energy is most expensive during these peak-load hours when the grid is operating close to its maximum capacity. 

In an effort to use energy more efficiently, hyperscale data centers usually opt for powerful liquid cooling methods. Often, liquid cooling is less energy intensive than air cooling. The problem is that certain liquid cooling systems use a tremendous amount of water. 

Now, a new cooling method known as Cold UTES could help data centers use less energy and water while reducing strain on the grid and saving data center owners money.

Efficient and water-conscious cooling

In many places where data centers are located, the area just below the surface of the earth, known as the subsurface, is made up of a layer of rock. It’s capable of absorbing large volumes of heat energy, creating an enormous heat sink.   

Using the Cold UTES method, data center operators can capitalize on this heat sink capacity to dump heat pulled from the servers into the ground rather than using large amounts of water and energy when it’s hot out.  

The process starts by cycling a heat transfer fluid between the server racks within a data center. The liquid pulls heat out of the servers, cooling them while warming up the liquid. The hot liquid is then pumped into the ground where it comes into contact with a large volume of cold rock. Heat transfers from the fluid into the rock until they reach the same temperature, thus cooling the liquid and warming the earth.  

The cooled liquid can then be pumped back to the surface and cycled through the data center again to pull more heat away from the servers, creating a contained cooling loop that is far cheaper and more efficient than traditional cooling methods. 

Over time, the subsurface rock will slowly start to warm up. When this happens, the rock can be re-cooled by running chillers to create cold water and then pumping that cold water below the surface. After it comes into contact with the subsurface, the water pulls heat out of the rock because the temperature imbalance is opposite; the fluid is colder than the rock. The rock is cooled, and the warmed water is then pumped back up to the surface where the heat is released into the air, thus “recharging” the thermal battery.  

The magic of Cold UTES is that the earth can be cooled during off-peak hours when the electricity is cheapest, typically at night or in the winter, a practice called load-shifting. 

Flash forward to the next hot day: Instead of having to buy energy from the grid to cool down servers, heat is easily transferred into ice-cold water, chilled by the earth. 

Two types of UTES: Borehole vs. reservoir (open-loop) 

In their research, NREL scientists explored two variations of Cold UTES. One method uses a borehole. A pipe passes through the data center and then down into the ground through the borehole, under the data center, and then back up to the surface, forming a closed loop. Inside the data center, the pipe connects to liquid cooling equipment.  

In a closed-loop system, antifreeze can be added to the water and cooled below the freezing point of water. The subsurface, in turn, can reach lower temperatures and absorb heat from the data center more efficiently.  

In addition to the borehole method, the scientists also explored an open-loop method. In this open-loop method, known as the reservoir system, water can be pumped directly into the ground and stored in underground pools in porous rock.  

One limitation of the reservoir system, however, is that it is temperature-bound by the freezing point of water, since it draws on natural underground reservoirs. Its application also depends on preexisting geological conditions, like porous rock, and can’t be applied everywhere. 

The future of Cold UTES in data center cooling 

Beyond saving data centers money, geothermal storage systems can lighten the load data centers place on the grid by reducing total peak demand—the most energy that the grid has to generate at a given time to meet demand. 

Furthermore, because there’s flexibility about when the rock gets cooled, a data center using Cold UTES could rapidly shed its power load as part of a demand response program if something goes wrong with an essential power plant—a grid emergency. Data centers participating in a demand response program would give grid operators the ability to reduce the data center’s energy demand as needed to clip peak loads. In exchange for participating in a virtual power plant (VPP), data centers would save money on energy costs and would help to stabilize the grid during times of high demand.

Although Cold UTES is still being researched, the Department of Energy and the Geothermal Technology Office (which are funding NREL’s research) anticipate that Cold UTES could play a crucial role in addressing an impending energy crisis. In their preliminary commercialization investigation, the researchers found that, “The scale of the energy arbitrage opportunity could be on the order of GWh to TWh and many millions of dollars in peak energy cost savings. For a prospective data center developer, these potential savings represent a financeable return on investment for building the Cold UTES.”  

The Geothermal Technology Office is also funding a commercial feasibility project that started at the beginning of 2025. In partnership with Lawrence Berkeley National Laboratory, Princeton University, and the University of Chicago, the Cold UTES researchers are expecting to publish their report in 2026, hoping to effect a rapid deployment of the technology.