AI is driving growth in data centers.
Google has announced plans to construct a new data center in Kansas City, Missouri, which is estimated to be worth $1 billion. This signifies the tech giant’s maiden data center establishment within the state.
The proposed facility is anticipated to offer a boost to the local area’s employment and energy infrastructure by creating up to 1,300 job opportunities. The data center is a part of a surge in similar infrastructures on a global level.
In a statement, Google’s spokesperson Chris Mussett recognized Kansas City as an ideal location for the data center, given the land availability and skilled workforce.
Mussett stated that AI is generating a significant need for data centers. “We consistently plan for future capacity needs, and our goal is to ensure that we have the necessary options to meet the increasing demand for our online services,” he explained.
The new data center will boost Google’s digital services, such as Google Docs, Google Maps, Search, and Gmail. Google formed collaborations with Ranger Power and D E Shaw Renewable Investments (DESRI) to supply 400 megawatts of new, carbon-free energy to run the facility’s operations, observed the office of Missouri Governor Michael Parson.
As data volumes continue to escalate quickly and AI facilitates further development, the data center industry is encountering fresh challenges and prospects, according to Sara Martin, associate principal at HED, an architectural and engineering design company.
An emerging trend is the integration of more adaptable and competent cooling systems to support higher densities and lessen environmental effects. “Data center executives are requesting engineers to develop models that can handle higher density cabinet loads as they move from conventional all-air cooling techniques to direct-to-cabinet cooling systems in preparation for AI’s impact,” stated Martin. “Increasing climate concerns will continue to exert pressure on data center corporations to implement more efficient cooling approaches as a strategy to lower their overall carbon footprint.”
Another notable change in 2024 is expected to be the expansion of data centers into fresh territories. As put forth by Martin, AI is likely to propel this change as data centers look for new locations with ready power supplies. He elaborated that the problem of fulfilling the power needs of contemporary data centers became noticeable in 2023 and will only exacerbate in 2024 if firms fail to move to places with adequate power.
Martin anticipates data center planners and financiers to identify markets such as Denver, Kansas City, Nashville, and Salt Lake City as suitable substitutes to power-limited areas. He succinctly summarized this strategy as “if the power can’t reach the data center, take the data center to the power”.
The growth of AI and the increasing trend of enterprises transitioning to the cloud have been significant triggers of demand for data centers according to Narayana Pappu. This CEO of Zendata, a data security and privacy compliance solutions firm based in San Francisco, stressed the importance of enhanced capacity in data centers to manage this demand and get ready for future needs without cost pressures.
When it comes to the best locations for data centers, Pappu noted that multiple factors come into play, including environmental risks, operational costs, and regulatory requirements. “The usual suspects from a location perspective have been northern Virginia, Silicon Valley, Singapore, and Shanghai,” he said. “However, since the pandemic, there have been more data centers breaking ground in the Midwest.”
Pappu also highlighted AI’s impact on data center workloads, saying that “the first impact is on the need for specialized hardware that AI applications need, along with increased demands on electricity and network usage.”
According to Gal Ringel, co-founder and CEO of Mine, a global data privacy management company, the data center industry is set for significant growth in the coming years. This growth will be driven by a combination of regulatory changes and the increasing demand for AI resources.
“Key benefits include the ability to capitalize on opportunity and increased data security,” Ringel said, discussing the advantages of having extra capacity in data centers. “Data localization and residency requirements are in place across Asia and Europe, with the latter due to the US long struggling to be granted an adequacy agreement for data transfers under the GDPR.”
According to Ringel, the recent executive orders from the US President, Joe Biden, which prohibits the transmission of sensitive data overseas, might surge the demand for domestic data center capacity among American corporations. He anticipates an increase in American corporations seeking domestic data center capacity, rather than opting for more affordable foreign data centers due to regulatory modifications. As such, data centers that possess excess capacity could potentially benefit from these regulatory changes, added Ringel.
