Carbon Accounting and Beyond: An Evidence-Based Life Cycle Assessment of the Environmental Impacts of Data Center IT Equipment

Data centers are essential to modern infrastructure, but are significant contributors to greenhouse gas (GHG) and related environmental challenges. Despite energy efficiency improvements, rising electricity demands driven by technologies like AI pose challenges to sustaining low-emission sector growth. Regulatory requirements mandate data center operators to report electricity use and emissions, yet current methods, particularly pertaining to indirect sources, remain insufficient. This study explores how life cycle assessment (LCA)-based estimates of data center IT equipment impacts compared with commonly used corporate GHG accounting methods: average-data and spend-based. Environmental impacts were modeled at both grouped and granular levels to support enterprise-wide reporting and operational decision-making. Sensitivity and uncertainty analysis validate the robustness of the LCA models. Scenario analysis was also conducted to assess emission abatement strategies, including on-site renewable energy generation and operation with a low-carbon electricity grid. The results show that the LCA approach produced emissions of 0.710 CO₂ eq/kWh, along with additional burdens that are not captured through carbon-only metrics. The LCA results are closely aligned with the average-data method (0.723 kg CO₂ eq/kWh) while the spend-based method yielded substantially higher estimates (1.07 kg CO₂ eq/kWh), highlighting the inaccuracies associated with volatile market prices. Scenario analysis identifies grid decarbonization as the most effective mitigation pathway, while also demonstrating environmental trade-offs across impact categories. Findings highlight the importance of comprehensive LCA-based assessment methods to improve emission reporting accuracy, transparency, and sustainability-focused decision-making in the data center sector.