For the period January 30-31, 2025, a team from the Northern Virginia Regional Commission (NVRC) visited the Equinix “TR5” data center campus at the Markham District Energy system, in Markham, Ontario, in Canada. The purpose of the study tour was to observe the development, operations and performance of the data center within the broader Markham District Energy system and to assess the potential applications of equivalent systems to Northern Virginia.
NVRC met with and discussed the relationship between data centers and district energy with officials from Equinix, the City of Markham, FVB Energy, Noventa Energy and Huber.
Learning from Equinix’s experiences at Markham about thermal energy conveyance from data centers through district energy is especially relevant for the Northern Virginia region. Northern Virginia hosts the largest concentration of data centers in the world. There are currently over 265 existing data centers (including 16 from Equinix) and approximately 100 are planned over the next decade.
Moreover, according to a 2024 report by the Commonwealth of Virginia’s Joint Legislative Audit and Review Commission, points to a potential doubling of demand for power in Virginia within the next 10 years from data centers.
Furthermore, the JLARC report added that “overall, the data center industry is estimated to contribute 74,000 jobs, $5.5 billion in labor income, and $9.1 billion in GDP to Virginia’s economy annually.” Finally, for the past 16 years, NVRC has thoroughly studied and assessed a broad range of district energy policies, technologies and rules. NVRC’s work over that time has consistently pointed to practical and feasible potential applications of district energy systems to Northern Virginia.
For the next 6-12 months, NVRC will undertake a range of activities to accelerate further understanding about the transfer and application of policy and technical innovations related to district energy and data centers from projects such as Markham (and other pioneering regions in the U.S. and abroad) to Northern Virginia.
The following summary of the study tour is framed chronologically with key observations and the most relevant lessons for cultivating district energy systems through data centers across Northern Virginia.
Equinix's Heat Export Program
Equinix, a major operator of data centers around the world, including Northern Virginia, has called for “municipal planning agencies, energy utilities and heat network operators around the world to join the Equinix Heat Export program to unlock the value of the residual heat generated in its International Business Exchange (IBX) data centers".
NVRC agrees this is an opportunity to be a showcase of this innovation.
In 2024, NVRC took further steps to advance the possible development of district energy systems for conveying heat among the region’s data centers. NVRC created a Data Center Proximity to Public Facilities map that characterizes the co-location of the region’s data centers and public buildings and some potential fundamental commercial exchanges of residual heat among suppliers and users.
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Trip Summary and Opportunities in Northern Virginia
Thursday, January 30, 2025
Meetings and Site Visits about district energy and data center policies, technologies and development at the Equinix “TR5” Facility / Markham District Energy (also with Huber, Coventa Energy, Markham District Energy)
Equinix operates one data center campus in Markham that conveys residual heat into the City of Markham’s municipally-owned district energy system.
Equinix has established the “Equinix Heat Export” program - a global partnership that invites municipal planning agencies, energy utilities and heat network operators to collaborate on expanding thermal energy conveyance from data centers through district energy systems. Equinix has implemented heat export initiatives through its data center operations in France, Canada and Finland and has a pipeline of projects under development in several other countries.
Experience from Equinix’s heat export through data centers initiatives abroad have resulted: 1) carbon emissions reductions; 2) lower cost low carbon heat; 3) reliable, low-risk energy management systems and service; 4) job creation in heat network industry; 5) economic security; 6) reliable scalability, especially through integrated infrastructure planning.
Equinix has mapped proximity of its data centers in Northern Virginia to local governmental buildings with aspirations to identify and prioritize a potential district-energy pilot project in Northern Virginia.
Relevant lessons for Northern Virginia include: 1) understanding that district energy is most easily developed for data centers in contexts where there is clear understanding of demand for existing and prospective heat; 2) ideal starting points for Northern Virginia are geographic areas that fuse greenfields development of data centers proximate to planned, dense, mixed-use developments (hospitals, college campuses, industrial parks, public pools and leisure centers, research laboratories). Retrofits in general are more expensive and challenging.
City of Markham Sustainability Program
Overview and discussion about City of Markham’s Sustainability programs as they relate to district energy and
In 2011, the City of Markham developed its “Community Sustainability Plan” that included a “Municipal Energy Plan” (MEP) and goal of achieving net zero emissions by 2050. The MEP explicitly included district energy as a key component of its strategy, with the city actively promoting and utilizing the Markham District Energy system to reduce greenhouse gas emissions and provide efficient heating and cooling to buildings within the municipality.
District energy in the City of Markham evolved through MDE and particularly with the catalyst of an IBM research laboratory and data center. IBM aspired to “outsource heating and cooling”. In 2020, Equinix purchased the “TR5” facility from Bell Canada.
The City of Markham’s plan has seen reductions of energy intensity by 8% for corporate facilities, 29% for streetlights, and 14% for municipal operations between 2014- 2019. Greenhouse gas emissions have been cut by 33,000 tons per year.
The Lessons for Northern Virginia are: 1) reducing greenhouse gas emissions is an important driver to justify district energy, especially in light of the high upfront capital construction costs; 2) integrated infrastructure planning and design is critical – especially when trying to identify existing or future demands for heat; 3) District energy can help substantially mitigate financial risk, mechanical/operational uncertainty over the long-term.
Friday, January 31, 2025
Markham District Energy
Overview and discussions about Markham
Markham District Energy, a thermal energy utility owned by the City of Markham, began operations in 2000 with the construction of its first energy plant in Markham Centre, and serving its first customer, IBM Canada.
MDE was established as a response to the need for reliable community energy systems following an ice storm in eastern Ontario and Quebec, with the City of Markham actively promoting district energy as a solution for its developing downtown core
Over the past 25 years, MDE expanded service other mixed-use districts of the City, such as the 30 million square feet it will ultimately serve in Markham Centre It is the only municipally owned district energy utility in Canada with two operating systems within the same municipal boundary.
- MDE has experienced only 2 hours of operational “downtime” in 20 years.
- MDE is planning to tap into a nearby wastewater trunk line to extract additional heat.
- MDE’s “hybrid energy center” fuses co-generation, gas, water source heat pumps, among other heat (and electricity) sources. MDE is a good example of the ability of district energy to use a variety of different heat sources, improving energy security and resilience and allowing the introduction of new sources of heat as technology develops.
- MDE’s growth has been steady and incremental – “start small and keep adding steadily”.
- MDE has designed some future district energy projects to include subtle technical additions such as space for 2- or 4-pipe systems, designated sites for pipe valves etc.
Potential Follow-up Activities and Goals (2025 – 2028)
Potential Short-Term (2025) Activities / Goals
- Within 10-12 months, identify/study suitability of one pilot project that ties together data centers and district energy.
- Work with partners to identify/study suitability of pilot project linking district energy and data centers, gather, assess and display geospatially, information about district energy and data centers and attributes such as: 1) existing or potential scenarios demand for heat; 2) development densities; 3) finance models; 4) attributes such as co-location/proximity of data centers to heat markets such as college campuses/aquatic centers/mixed use development, scale projects.
- Form and convene working group of officials involved with data centers, local governments, research institutions and developers to discuss viable/suitable pilot project opportunities.
- Develop baseline/metrics for GHG emissions in Northern Virginia as they relate explicitly to data centers to help policymakers track and correct any programmatic successes or weaknesses related to district energy.
- Work with partners to study economic feasibility of adding cooling to district energy systems in Northern Virginia.
- Assess viability of designing small-scale engineering applications to make future development of “district energy-ready” sites.
- Study viability of creating a Markham-type “Hybrid Energy Center”.
- Develop case studies or analyze different financial models for district and data centers
Potential Long-Term Activities / Goals
- Replicate and scale-up data center/district energy pilot project