Alaska's Data Center Rush: What's the Real Cost?

Governor Courts Tech Giants

Alaska is emerging as a potential hotspot for data centers, fueled by the surging demand for artificial intelligence. The state's governor has been actively courting tech giants like Microsoft, Facebook, and Amazon, showcasing sites in Anchorage and Fairbanks. The goal is to boost the economy, create jobs, and position Alaska as a tech leader. However, it's essential to weigh the potential downsides.

Understanding Data Centers

Data centers are large facilities housing the infrastructure needed to support AI and other digital services. They come in two main types:

Hyperscale facilities: Can consume as much electricity as 100,000 homes.
Microgrid data centers: Smaller but still significant in energy consumption.

Given Alaska's energy landscape, these figures raise significant concerns.

Environmental Concerns

The Northern Alaska Environmental Center (NAEC) urges caution, highlighting several critical issues:

Energy and Water Use

Data centers have high energy demands, especially for cooling.
While Alaska's cold climate is an advantage, cooling still requires a lot of water.
NAEC advocates for minimizing water use and reusing waste heat for local heating.

Electricity Source

Most data centers still rely on fossil fuels, contradicting global decarbonization efforts.
NAEC suggests requiring new data centers to build or contract for an equivalent amount of clean energy generation.

Electronic Waste (E-Waste)

Data centers generate a lot of e-waste, which contains hazardous materials.
Given Alaska's remote potential sites and limited recycling infrastructure, this is a significant issue.

Tax Breaks and Subsidies

Some states have granted substantial tax breaks and subsidies to attract data centers, often with limited public benefit.
Alaska should learn from these mistakes and ensure corporations do not get discounted power rates or tax breaks that pass additional costs to ratepayers.

Job Creation

Data centers are highly capital-intensive and employ few people for operation.
Companies should be required to train and hire local residents.

The Bigger Picture

Beyond energy, economics, and the environment, there's a profound issue: data centers expand the compute available for increasingly capable AI systems. Some researchers argue this could accelerate progress toward AI that matches or exceeds human capabilities, along with new risks. Ultimately, the greatest cost of data centers and AI may be the changes wrought to our humanity and society.