🌍 Data Centers Have Reached the Arctic Circle Limit

Artificial intelligence laboratories are consuming computational resources at an accelerated pace, leading data center operators to head north in search of abundant and affordable energy. In Borlänge, Sweden, a new data center is being constructed on the site of an old paper mill. Peter Michelson, CEO of EcoDataCenter, stated that Borlänge will now produce "the raw material for the next era of information."

This center is just one of over 50 projects either under construction or in development in the Nordic countries, where the demand for data centers to train and run AI models is on the rise. According to a study by CBRE, data center capacity is growing faster in this region than anywhere else in Europe.

Last year, OpenAI announced it would deploy 100,000 GPUs in a small Norwegian town within the Arctic Circle, and Microsoft followed suit. Recently, the French AI lab Mistral announced a $1.4 billion investment in infrastructure in Borlänge, while other developers plan projects that could double the current data center capacity in Finland.

The shortage of suitable sites in Europe, with sufficient energy to support AI workloads, is driving this construction. Kevin Restivo, director of data center research at CBRE, mentions that "Norway has exploded as a hotspot for data centers."

Traditionally, these centers were located near major cities and financial hubs, but that situation has changed. Now, quick access to energy is the priority. The growth of the data center industry in the Nordics also coincides with the emergence of "neoclouds," companies that offer access to large fleets of GPUs, allowing them to establish data centers in remote locations.

The Nordic countries offer a unique combination of available land and cheap energy, while also meeting the EU's strict emissions targets due to their renewable energy. Philippe Sachs of the company Nscale states that "not much is being sacrificed by locating there, but one gains immensely: abundant green energy with low industrial demand."

The arrival of these data centers is driving up land prices in remote areas where traditional industries have declined. The hope is that this investment in AI will revitalize rural economies. However, the realization of these projects depends on their effective development.

For now, as space in Western Europe runs out, plans for new data centers in the Nordics continue to be announced almost weekly. The energy shortage remains the biggest limiting factor in other regions.

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