As candidates promising to halt data center construction were elected in the U.S. midterm elections, major tech companies are turning their attention to deserts and overseas locations. South Korea, mentioned as a potential site, is also facing local opposition.
According to a report by the Wall Street Journal (WSJ) on November 6, Sam Altman, CEO of OpenAI, addressed employee questions about data centers the day after the elections. He acknowledged that people generally do not want to live near data centers and suggested that they might consider building them in deserts. OpenAI's management is currently discussing whether to revise its data center expansion plans for next year.
Whether deserts will provide a viable solution remains uncertain. Conflicts over water resources are already emerging in the southwestern U.S. According to local media, the Tucson City Council in Arizona unanimously rejected a $3.6 billion data center complex known as 'Project Blue,' reportedly linked to Amazon, last August. Residents formed a group opposing desert data centers, citing concerns over water and electricity usage.
The anxiety among big tech companies stems from the election results. Candidates who campaigned on halting data center development won in key states like Texas, Georgia, Ohio, and Michigan. The industry is bracing for construction halts, stricter environmental regulations, and delays in permits. Tech investor Brad Gerstner claimed in a podcast that up to 35% of planned data center projects in the U.S. next year could face setbacks.
As an alternative, overseas construction has emerged as a possibility. Dina Powell McCormick, president of Meta, stated at the WSJ Tech Conference on November 4 that building new data centers in the U.S. will become increasingly difficult, and all major cloud companies are considering construction outside the U.S. Anthropic has also identified local government construction halts as a significant business risk and is pursuing overseas data center projects, according to WSJ.
South Korea has already emerged as a candidate for big tech's overseas bases. Amazon Web Services (AWS) is collaborating with SK Group to build a 7 trillion won AI data center in the Ulsan Mipo National Industrial Complex. NVIDIA has expressed interest in participating in the new AI data center being developed by Hyundai Motor Group in Saemangeum. The government also broke ground on a national AI computing center in Haenam, Jeollanam-do, in August. Local governments are competing to attract these projects, viewing them as a solution to regional decline.
However, opposition has already begun domestically. In areas near residential zones in Gimpo and Anyang, as well as Geumcheon and Yeongdeungpo in Seoul, protests have arisen over concerns about electromagnetic waves, noise, and fire hazards. According to commercial real estate firm R-square, the number of data center permits nationwide dropped from 25 in 2023 to 14 last year. In non-metropolitan areas, issues have also been raised regarding water supply plans in places like Pohang, Gyeongsangbuk-do.
The special law for AI data centers, set to take effect in March next year, includes exemptions for power system impact assessments for projects outside the metropolitan area. Critics argue this could shift the burden of electricity and water costs onto local communities.
* This article has been translated by AI.
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