How Data Centers Actually Work
Lauren Goode: Well, they all want to farm more. Who among us, Mike? But hyperscalers refer to this class of large technology companies or cloud service providers. So Meta, Amazon, Microsoft, Google, they’re all in that category.
Molly Taft: Yes, and I think it’s important to remember that these companies have so much money and they have an ability to raise capital like no one else. So they are able to do really crazy things to build quickly and really really big. And they’re getting pretty creative, because their goals right now are to build these things quickly and get them up and running so that they can basically use this physical infrastructure to compete with each other.
Lauren Goode: I think it’s true, Molly. I think there’s a lot of enemy building going on right now, and I’d just love to be a part of their group chats when all these announcements are made.
Michael Calore: Yes, and speaking of enemies, the other sphere of influence in which these companies operate is the political sphere. Obviously, to build a giant data center somewhere, you need to have the political will to do it, which means you need buy-in from local residents, from local government, from the state, from the country. So what’s happening in the political sphere between those who want to build more data centers and those who oppose regulation? How is it going?
Molly Taft: That’s a great question, and I think if you look at the national conversation, it’s quite different from what’s happening at the local level. You have Washington, you obviously have an administration that is very supportive of the idea of an American AI empire. What is important to the energy debate is that the Trump administration has addressed this support by supporting fossil fuels. They really wish all data centers were powered by oil and gas, some nuclear and coal. And it works very well for these industries as well. If you’re going to experience this massive expansion in energy demand, it’s really cool to be in the middle of it and be the one that everyone wants to turn to for energy resources. And then, on the other hand, there’s been this influx of local opposition to these data centers for a variety of reasons, whether it’s water consumption, concerns about rising electricity rates, or noise, and some of the biggest struggles have catapulted this issue into the national debate. I’m thinking of xAI in Memphis. When Elon Musk wanted to run xAI, he installed a bunch of unlicensed gas turbines in order to run xAI, which he installed in a predominantly black community in Memphis that already had serious problems with air pollution and asthma. And these people made themselves known. Earlier this year, DC attempted to impose a moratorium on any state regulation around AI. This was an incredibly broad inclusion in the Big Beautiful Bill that ultimately did not come to fruition. But one of the people who publicly opposed it was Marjorie Taylor Greene, who actually mentioned data centers in her opposition, and she compared AI to Skynet, the fictional AI from the Terminator movie franchise. So it creates strange partners with each other, I think there’s this kind of contrast between what the administration is trying to push forward and some very powerful energy companies that have everything to gain, and some really grassroots grassroots movements and people who are concerned about the impacts of what these things are going to have on their communities.
