West Texas, from the oil rigs of the Permian Basin to the wind turbines spinning above the High Plains, has long been a magnet for companies seeking fortunes in energy.
Now, those barren farmlands are offering a new money-making opportunity: data centers.
Energy and data center management firm Lancium, which has set up shop in Fort Stockton and Abilene, is one of many companies around the country betting that building data centers near generating sites will allow them to use less-used clean power. will allow.
“It’s a land grab,” said Lancium president Ali Fan.
In the past, companies built data centers closer to Internet users to better serve consumer requests, such as streaming a show on Netflix or playing a video game hosted in the cloud. But the development of artificial intelligence requires large data centers to train the evolving large language models, making proximity to users less essential.
But as more of these sites start popping up across the U.S., there are new questions about whether they can keep up with demand while still operating sustainably. The carbon footprint from building the centers and racks of expensive computer equipment is substantial in itself, and their electricity needs have increased significantly.
Just a decade ago, data centers drew 10 megawatts of power, but today 100 megawatts is common. The Uptime Institute, an industry advisory group, has identified 10 supersized cloud computing campuses across North America with an average size of 621 megawatts.
The surge in electricity demand comes as U.S. manufacturing is at its highest in half a century, and the power grid is increasingly strained.
The Uptime Institute predicted in a recent report that the sector’s numerous net-zero goals, self-imposed benchmarks, will be difficult to meet given the demand and that backsliding is common. can
“It’s not just about data centers,” said Mark Dyson, managing director of RMI, a nonprofit organization focused on sustainability. “Data centers are a practice run for a much larger wave of load growth that we’re already seeing coming from the electrification of industry, vehicles and buildings in this country.”
The data center industry has embraced more sustainable solutions in recent years, becoming a significant investor in renewable energy at the corporate level. Sites leasing wind and solar capacity increased 50 percent year-over-year to more than 40 GW by early 2023, with capacity continuing to grow. Still, demand outpaces these investments. And more processing power is needed to back up the interconnection queue and generate stopgap solutions.
Power-hungry data centers further complicate the balancing act at full power. The data centers in the construction pipeline, when completed, will use as much annual electricity as the San Francisco metro area, according to a report released Wednesday by real estate services company JLL. Most of the sites coming online this year have already been leased. In popular markets, the flagship location won’t open for at least two years.
“You’ve got to get as many gigawatts live as you can, as fast as you can,” said Ms. Fenn of Lancium. “People are going to pull it off any way they can.”
It has driven rapid growth beyond tier-one and tier-two markets such as Northern Virginia, Dallas and Silicon Valley.
Competition is increasing in parts of the country that offer cheap land and available electricity. For example, Amazon announced last month that it was planning the state’s largest economic development project in Mississippi, a $10 billion project that would include data centers and solar generating sites.
“Anyone with a significant source of power is now a new data center market,” said Jim Kerrigan, managing principal of North American Data Centers, an industry consultancy.
AI is only a small percentage of the global data center footprint. The Uptime Institute predicts that AI will grow from 2 percent today to 10 percent of the sector’s global power consumption by 2025.
“They’re building very quickly for demand, along with many other types of drivers,” said Andy Lawrence, the institute’s executive director of research. “AI is kind of the foam at the top.”
According to real estate firm CBRE, construction of data centers grew by 25 percent last year. And Nvidia, which supplies most of the high-tech chips that power the technology, last week reported record gains in data center sales, with 2023 revenue expected to reach $47.5 billion, up from last year. 217 percent higher.
Christopher Valles, vice president of sustainability at Equinix, a global data center operator, said the nation’s energy grids can’t handle that kind of demand. “Technology is moving faster than our infrastructure,” he said.
Equinix, which operates 260 data centers worldwide, has installed fuel cells from Bloom Energy to help provide backup power to many of its data centers. The company is also reducing emissions with offsets, such as through power purchase agreements, and has squeezed 5 percent more efficiency out of its operations over the past year, Mr. Valles said. Design firms like Gensler are experimenting with new designs that feature large amounts of wood to reduce the embodied carbon of data centers.
And AI can help itself: In a data center in Frankfurt, Equinix has used the technology to moderate cooling loads and adjust energy use in concert with changing weather, allowing data center 9 Percentage is more effective.
Niklas Sundberg, a sustainable IT expert and chief digital officer at transportation and logistics company Kuehne + Nagel in Sweden, said the industry will need to focus on investing in renewables.
Some sites have attempted to install on-site gas power plants to compensate for grid shortfalls. This may be cleaner than existing power, but it adds to the industry’s substantial carbon footprint.
And lawmakers have proposed more transparency and action. The Senate introduced a proposal in early February to assess the environmental impact of AI. Lawmakers in Northern Virginia, known as Data Center Alley, have pushed for mandatory sustainability goals for data centers.
Virginia state senator Suhas Subramaniam proposed several rules, including one that would require data centers to get at least 90 percent of their power from renewable sources to qualify for subsidies. . “I don’t want to put my kids in a situation where, in 20 years, they have to pay some bills for things that we thought were a good idea and didn’t happen,” he said. “