Nonprofit investment firm Elemental Impact is teaming up with large tech companies to provide late-stage tech innovations “front door access” to data center deployments.
Elemental, with the buy-in of Amazon, Google, Meta, and Microsoft, today announced the creation of the Data Center Innovation Initiative, a membership-based program focused on piloting and scaling sustainability technologies in and around data centers. The tech companies will pay annual membership fees to cover the operating costs of the initiative. They have already worked with Elemental to scope technology priorities and structure the effort, and will help evaluate and deploy solutions going forward.
Through DCII, Elemental Impact will invest between $500,000 and $5 million per project in up to 10 technology startups through 2027, with a focus on sectors including energy, materials, water, and circularity. The program will source technologies, fund and support pilots inside data centers, and then distribute technology roadmaps and resulting insights among its members.
Data centers are already piloting promising technologies, according to Microsoft’s head of sustainability Melanie Nakagawa, but they’ve been hard to scale. “We see a bit of a struggle to move from pilot to large-scale deployment,” Nakagawa told Latitude Media. “Companies pilot new technologies individually, but have limited bandwidth…compared to the agility of an accelerator.”
Importantly, however, DCII is strictly focused on technologies that have applications beyond data centers. The program is designed to “leverage data centers as an early commercialization so that technologies can scale and then be able to be deployed in other contexts like hospitals and schools,” explained Dawn Lippert, founder and CEO of Elemental Impact. “It’s really the idea of organizing the large tech companies…and then use that as a launching point for important technologies.”
That focus means that, for example, DCII won’t include chip-level cooling efforts that are highly specific to individual server designs (although Microsoft is pursuing its own closed-loop and microfluidic chip-cooling research). Instead, the program will prioritize building-level and envelope cooling solutions that can translate across many kinds of infrastructure, Nakagawa said.
The initiative is distinct from traditional accelerators, one-off corporate procurement programs, and even Google’s clean transition tariff model — a novel rate structure the hyperscaler has leveraged to fund emerging technologies including geothermal and long-duration energy storage — in that it is built around a shared framework, Lippert explained.
Rather than each hyperscaler quietly running its own bespoke pilots, DCII brings together companies with different operational needs and priorities to agree on common specifications and create a clearer access point for solutions providers. The goal is to help startups escape the “doom loop” of having to pilot with individual data center operators, starting from scratch each time.
And though the program includes energy solutions, speed to power isn’t the only focus. Microsoft and its peers see innovations related to concrete, steel, water use, and other pieces of the data center footprint as crucial levers on their fast-growing scope 3 emissions, Nakagawa explained.
“There’s an interesting opportunity here to think about all the different ways you can drive innovation in innovative solutions, and accelerate really promising technologies at scale that reduce the environmental footprint of this type of physical infrastructure,” she said.
