1) Most software gets its timestamps from the system clock 2) If you have a mismatch between the system time and the application time, then you just have log timestamps that don't match up; it's a nightmare - even more so around DST/ST transitions

A server doesn't need to "know" where in the world it is (unless it needs to know the position in the sun in the sky for some reason).

A server doesn't "think" and the timezone has no relevance to where it is located physically.

From a logging perspective, there is a time when an event happens. The timestamp for that should be absolute. Then there's the interaction with the viewer of the event, the person looking at the log, and where he is. If the timestamp is absolute, the event can be translated to the viewer at his local time. If the event happens in a a different TZ, for example a sysadmin sitting in PST looking at a box at EST, it's easier to translate the sysadmin TZ env, and any other sysadmin's TZ anywhere in the world, than to fiddle with the timestamp of the original event. It's a minor irritation if you run your server in UTC, and you had to add or subtract the offset, eg. if you want your cron to run at 6PM EDT, you have to write the cron for 0 22 * * *. You also had to do this mental arithmetic when you look at your local system logs, activities at 22:00:00 seem suspicious, but are they really? Avoid the headaches and set all your systems to UTC, and throw the logs into a tool that does the time translation for you.

The server does not "know" anything about the time, that is, it's really about the sysadmin knowing what happened and when.

you've got it backwards - the server clock should be in UTC, and if an individual piece of software needs to know the location, that should be provided to it separately.

for example, I've got a server in my garage that runs Home Assistant. the overall server timezone is set to UTC, but I've configured Home Assistant with my "real" timezone so that I can define automation rules based on my local time.

Home Assistant also knows my GPS coordinates so that it can fetch weather, fire automation rules based on sunrise/sunset, etc. that wouldn't be possible with only the timezone.

I'm not sure why you're getting downvoted.

Yes, that's exactly what I'm saying :). In fact, I've run servers where I didn't even physically know where it was located. It wouldn't have been hard to find out given some digging with traceroute, but it didn't matter. It was something I could SSH into and do everything I needed to without caring where it was.

Everyone else down-thread has clarified the why of it. Keep all of your globally distributed assets all running on a common clock (UTC) so that you can readily correlate things that have happened between them (and the rest of the world) without having to do a bunch of timezone math all the time.