🌍 Data centers reach the edge of the Arctic Circle

As artificial intelligence (AI) labs consume more and more computing resources, data center operators have started moving north in search of cheap and abundant energy.

In the Swedish town of Borlänge, a new and extensive data center is being built on the site that once housed a paper factory. EcoDataCenter's CEO, Peter Michelson, noted that "Borlänge will produce the raw material for AI and the next era of information".

This center is one of over 50 that are under construction or planned in the Nordic countries, where the demand for data centers to train and run AI models is rapidly growing. According to consulting firm CBRE, this region is the fastest growing in data center capacity in Europe.

Last year, OpenAI announced the deployment of 100,000 GPUs in a small Norwegian town within the Arctic Circle. Microsoft has also followed this path. Recently, the French lab Mistral announced a $1.4 billion infrastructure contract in Borlänge, while other operators are planning massive facilities in Sweden and Finland.

Construction is driven by an acute shortage of sites in Europe that are large enough and have adequate energy supply to support AI workloads. Kevin Restivo, director of research for data centers at CBRE, mentions that "power is an increasingly valuable and scarce commodity".

Traditionally, data centers in Europe were concentrated in metropolitan and financial hubs like Frankfurt and London. However, since the success of ChatGPT, the situation has changed. Now, rapid access to energy has become the primary criterion for developers.

The Nordic countries offer a unique proposition: abundant land and energy, and energy in the region is one of the cheapest in Europe. The availability of renewable energy, such as hydro and wind power, combined with a cool climate, helps operators meet strict EU emissions targets.

The growth of the data center industry in the Nordics has coincided with the emergence of "neoclouds," specialized cloud companies that sell access to large fleets of GPUs optimized for AI workloads. These companies are driving most of the growth in data center capacity in the region.

The demand from data center operators is causing an increase in land prices, even in remote areas. The arrival of these AI data centers is expected to revitalize declining rural economies.

However, the success of this vision depends on the realization of the proposed projects. As available space in Western Europe continues to diminish, plans for new data centers in the Nordics are announced almost weekly.

📌 More information: Data centers have reached the edge of the Arctic Circle - WIRED