Strategic data center siting can mitigate dilemmas between decarbonization and digitalization in Japan

Digitalization and decarbonization are central pillars of sustainable development, yet their integration remains underexplored. While energy transition toward net-zero emissions may push up electricity prices in the short term, data centers—the core of digital infrastructure—are rapidly increasing local electricity demand, further straining the power system. Here, we employ a high-resolution power system model covering 1,741 municipalities across Japan to examine the role of data center siting strategies in co-achieving the digital growth and climate targets. Our results highlight that while data center expansion and decarbonization efforts jointly raise electricity costs, distributing data centers away from urban areas can leverage regional renewable energy potential, mitigate electricity cost increase, and reduce reliance on fossil fuels and carbon removal technologies along the transition pathway to the 1.5°C target. Notably, these benefits hold even under practical constraints that aim to ensure infrastructure access while avoiding natural disaster risks and land-use conflicts.