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Governments welcomed data centers. Now they’re grappling with the fallout

Daniel Nenni

Admin
Staff member
The boom in AI data centers is colliding with weak power grids, soaring energy demand, and growing local pushback.

A photograph showing a man, standing with his arms crossed and wearing black clothing, in front of two large green industrial tanks.

Tamara Merino for Rest of World
By Rest of World

Countries around the world are investing millions of dollars in building data centers to meet the growing demand for generative artificial intelligence, while also storing data within their own borders. But many of these countries have climates that are too hot for optimal data center operations, cranking up the cost of electricity.

In Rest of World’s recent visual investigation, we set out to document how many data centers globally are located in regions that are too hot. We found that in 21 countries, including Singapore and the UAE, all data centers are located in areas where the average temperatures are simply too high.

Many of these countries are scrambling to meet the data centers’ rising energy demands. In Mexico, home to 150 data centers, the limited electric grid has forced companies including Microsoft to use gas generators.

Brazil recently announced its national data center policy, intended to lure Big Tech with tax breaks and renewable energy alternatives. Tech giants have already signed multimillion-dollar contracts to build data centers in the country. But environmental regulators are raising the alarm about their potential impact, especially in fragile areas, including a city that was hit by record floods last year.

Data centers are often touted as engines of growth. The Chilean government and companies including Google and Microsoft have said they will create thousands of jobs. In June, Chilean President Gabriel Boric announced that Microsoft’s hyperscale data center cluster would generate over 81,000 jobs. But permit filings show the largest data centers have the potential to create only hundreds of full-time jobs, mostly in security and cleaning.

There is also growing pushback worldwide against the large quantities of water needed to cool data centers, their broader environmental impact and their land use. In Chile, where 16 data centers have been approved in capital Santiago’s metropolitan area over the past 12 years, activists are pushing for environmental compensation, and transparency around the water and energy consumption of each data center. In the Brazilian state of Ceará, TikTok is investing in a $10-billion data center. Members of an Indigenous group, who say the project is being built on their land, are trying to stop it.

What is happening in Ceará “is an emblematic case of resistance and questioning of a Big Tech data center,” Cynthia Picolo, executive director at the Laboratory of Public Policy and Internet, told Rest of World. “This experience will generate important precedents.”

 
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