AI is booming, electricity demand is exploding. Tech companies in the USA are building data centers that require as much energy as a medium-sized city. They pour money into affected communities. They also pay for transformers, power lines and power plants. But companies have been waiting years for gas turbines. New nuclear power plants will be ready later. Despite all of Donald Trump's reservations, wind turbine manufacturers are also reporting booming US business. However, they alone cannot cover the data centers' electricity needs. This also applies to solar parks with battery storage, as portfolio manager Patrick Vogel explains in the podcast "NTV's Climate Laboratory": "The problem is that the operators of the data centers promise in the contracts that the data centers will be available 99.999 percent of the time."
ntv.de: Data centers are a frustrating topic. This is why electricity prices are rising in the USA. Has the USA now found a solution for this?
Patrick Vogel: We know this from Germany: investments in the network or energy infrastructure are passed on to the general public. This increases the cost of electricity for ordinary customers. People don't like that. That's why the USA took action against it.
To what extent?
Anyone who builds a data center must contribute to the costs for the municipality. This means that Meta boss Mark Zuckerberg doesn't just buy building land, but the entire infrastructure. He pays for transformers, the new power line and the generation capacity - whether that be gas turbines, a solar park or wind turbines. Money also flows into social projects.
The big tech companies are trying to buy the love of data centers?
This is also the case in Africa: when foreign countries invest, a well or a school is also built.
And that works?
If the local school receives money or the teachers increase their annual bonus sixfold, it will definitely be received positively. Things work differently in Germany. Two communities near Frankfurt have just rejected the construction of data centers.
Because of the price of electricity?
You don’t want a data center in your own front yard. But you have to be able to afford to forego these trade taxes in the future.
Reports about data centers with their own gas turbines may make you sick to your stomach. Amazon, Google and Microsoft had set ambitious targets for reducing their CO2 emissions. Everyone has thrown these goals overboard. Business for gas turbine manufacturers like Siemens Energy is booming.
Americans tend to be more pragmatic. They prefer to offset additional CO2 emissions from gas turbines by building a solar or wind farm elsewhere. And to be honest, you have to say: Even if I use solar power, I need a controllable energy source. You also have to see that US corporations are building huge data centers in the gigawatt range. This corresponds to the energy consumption of a medium-sized city.
Or the output of a large nuclear power plant.
You first have to generate this electricity. That would be a damn big solar park that would also require a lot of battery storage - or small gas turbines. Now the USA is known to have large gas reserves. Companies are taking advantage of this, like Elon Musk in Memphis.
He has equipped his huge Colossus data center with dozens of gas turbines - without approval.
In Colossus you have to distinguish between two locations. The controversial gas turbines of the first data center were located in Memphis itself. The second location also generates electricity in neighboring Southaven, Mississippi. Other authorities are responsible there.
Do the operators also use coal-fired power plants to generate electricity? US President Donald Trump would certainly like that.
He wants to burn more coal, but the companies usually forego it because it is too expensive. Ultimately, it's about getting energy as quickly as possible. That's why no one relies exclusively on new nuclear power plants. Many people would like to do that, but then they won't have electricity until 2035 at the earliest. Nobody wants to wait that long. The data centers are being built now. So you take gas turbines or fuel cells.
They are basically the opposite of electrolyzers: An electrolyzer produces hydrogen from electricity and water. A fuel cell converts natural gas into electricity.
Yes. This is more environmentally friendly than burning gas, but also more expensive. The power supply is always a question of consideration. Most companies ultimately have a portfolio of different energy sources.
Elon Musk has announced that he wants to produce turbine blades with SpaceX. Apparently they are the bottleneck in the production of gas turbines. There are said to be major delivery problems. Musk wants to help manufacturers.
There are currently only four companies in the world that produce such shovels. Elon Musk would be the fifth manufacturer. But that is incredibly complex. These blades are exposed to extreme temperatures. This is the finest engineering and material art.
Is this bottleneck already impacting data center construction? Nuclear energy is obviously not a solution. Operators have to wait longer and longer for new gas turbines. What about solar energy and battery storage? There are plenty of them.
Unless you can get your hands on a running nuclear power plant, but they don't have much free capacity either. Large gas turbines from Siemens Energy, GE Verona and Mitsubishi Heavy Industries currently have delivery times that sometimes last several years. If things have to happen quickly, you inevitably end up with renewables. Wind turbine manufacturers like Vestas repeatedly report large orders from the USA, but do not say who the customers are.
US President Trump thinks wind turbines are ugly. He also considers them a threat to national security.
The project companies and the operators of the data centers know exactly which energy source is profitable and which is not and which electricity they can get and how quickly. So they buy wind turbines.
What about solar energy?
It depends on where the data center is located. In Arizona or Texas there is a lot of sun. Large solar parks are being built there. The problem is that data center operators promise cloud providers in their contracts that the data centers will be available 99.999 percent of the time. This only becomes difficult with solar energy and battery storage. You have to calculate how you can survive several shady days. That's why you end up with an electricity mix again. It's the same the other way around. Gas and nuclear power plants require regular maintenance. We know that from France. In fact, data center operators don't want to deal with these questions at all. These are not utilities. They would prefer to simply be connected to the public power grid.
Where they may increase electricity prices... is that also an issue in Germany? The Schwarz Group, known for Lidl and Kaufland, wants to build a large data center near Rostock.
No. As with the construction of wind turbines, we see the “not in my front yard” phenomenon. Otherwise, people are more concerned about water consumption and air quality. Data centers have many chimneys on the roof. That's intimidating.
Chimneys?
For diesel generators. If the contract states that the data center is available 99.999 percent of the time, I have to plan for a power outage. But this should not be overestimated. Aside from the attacks in Berlin, when was the last major power outage? The German power grid needs to be made future-proof for renewable energy, but compared to the US grid, it really is the gold standard. The German projects are also significantly smaller than the American ones. They like to connect to the grid where a coal-fired power plant used to stand because the infrastructure is already there.
And are they powered by renewable energy?
That's the advantage of building on the coast. When the large Taiwanese chip manufacturer TSMC went to Dresden, he also said: We will only come if the airport stays open so that our employees can arrive and depart easily and if you provide us with renewable energy. This is what is set for these companies. They want a clean and reliable power supply. That's what we offer. The biggest challenge for Germany is to allow technology and progress. Developments such as wind energy, solar energy or even artificial intelligence cannot be turned back. Rather, we should consider how we can benefit most from it.
