Is the shine already coming off ai & data centers?
- Thread starter dorndawg
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I agree with your basic point, but just to clarify (and I think what walkthedawg was saying) is that some of the stuff China does is not just negative for "their" people and environment... they can and do negatively affect the world in massive ways, with seemingly no regard and no remorse. Besides the spies stealing our technology on a massive scale, strongarming asian and african countries to rob them of their minerals, large-scale purchases of land in the US and others near military facilities, and sinking billions of dollars into sowing chaos using disinformation campaigns... China also happens to be the source of ~35% of the world's greenhouse gases and carbon dioxide.
Maybe all this would be okay if this was just a large and busy country which was a generally good actor and trustworthy neighbor. But China is the opposite of those things.
You have to reject the heat somewhere. As they “get better,” where are they getting better at rejecting it to? I’m a process engineer. These vagaries don’t impress me. Industries have needed to cool hot stuff for well over a century — your data centers are not new to that thermodynamic problem.
“Other than what’s lost to evaporation.” Ya think!? The north LA data center is expected to be about a 2000 MW hog. Virtually all that ends up as heat that must go somewhere. If it’s rejected to water as evaporation, that’s 19 million gallons per day. Plus blowdown, call it 25 million gpd. Set me straight on where I’m wrong.
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And let's not forget these are mostly the same peeps that claim they'll put these things in space.....where cooling is nearly impossible.
The only real solution is incorporating a power generator, so all that generated heat can be put to use. That's not easy or efficient though. Bottom line these data centers are gonna be redonk expensive
...unless they are offloading costs onto the public via sweetheart deals with govt. Then they'll just be regular expensive.
And all to support a product that the Chinese will just knock off and undercut any pricing on. People keep comparing this to the dot com boom, but this is more like the railroad boom. There is transformational profit to be made....but competition will spread it and limit it, meaning all the capex will never give good returns.
I'm thinking Alphabet is the eventual winner here. They have brand recognition and existing infrastructure, so they dont have to have the best product. Plus they have the outside revenue to keep supporting the capex when debt financing dries up. This may apply to Meta too. I bet they join together and buy out/merge the rest. Then they have a US monopoly and can take on China.
Cato has us at 15th, for what that is worth.
Wait. With all the moronic egg heads claiming climate change(there’s an oxymoron) why not use all the desalination processes to make ocean water usable and at the same time get the benefits of “lowering” the ocean levels before “climate change” has a chance to raise them! Problem solved on two fronts!
With all due respect, I don't have to prove shitt to you, kind sir. But I know there are lots of smart people out there working to solve the very issues you bring up.
I'm sure there were a bunch of Egyptian nerds sitting around 5,000 years ago thinking Imhotep was an idiot and there was no way mathematically he could get rocks that high up to build the pyramids. There were certainly people who thought the Wright Bros were insane for trying to get a vehicle to fly in the air because mathematically it seemed impossible - and I'm sure there were a bunch of scientists in China and Russia watching us in the 60's thinking there was no way (mathematically) that we could land people on the moon, much less bring them back.
To sum up, I have faith in humanity to solve nearly any problem that arises, as we have done for millenia, and that civilization will find a way to continue progressing - no matter what all the big scary numbers currently say about evaporation.
They will lie to the public and claim they have the problem solved or it’s just around the corner, meanwhile once they get the data centers on line, the power grid and public water supply will get fleeced. This project is something the elites want and it’s not in our best interests.
Why is 'climate change' an oxymoron?
- An oxymoron is a term that contains words which seem to conflict or contradict.
- 'climate change' is a term that expresses the change of long term averages and patterns in weather. Depending on timeframe and period of time, there could be anywhere from no change to significant change.
Not really sure where the contradiction is.
Man you rally can learn anything on SPS - multiple experts on the subject of comparative happiness!
Are you the expert on assessing the shine of data centers?
This is only semi-AI related, but Alphabet seems to have a big opportunity in enterprise services. Microsoft products generally suck, but it's just so hard to get people to move away from them because of a combination of inertia, path dependency, and network effects. If Gemini is better than copilot by enough (and I think right now it is), you may see it push companies to bite the bullet and move to Google Workspaces generally. Google prints so much money from ad revenue, I'm not sure it will be a major focus for them, but it could feasibly be a 10% boost to its revenue if it took a lot of market share from Microsoft 365/Office.
That is the "Human iNdex" ranking I believe, which is a combination of the "Personal Freedom Index" and "economic freedom Index". I can't even tell what some of that is about, but I will say that the economic freedom index, which is much more objective, the US does better. You have lots of people that weight easy access to abortion very high in determining their ranking, but it would be just as easy to flip that ranking on the basis that one of the first freedoms is not being killed when you are inconvenient. The Cato index does include homicides in its personal freedom ranking, which is important, but doesn't really measureu freedom except in a round about way of less corrupt governments will generally have lower homicide rates, all else being equal (but of course all else isn't equal; the US has a legitimately more violent populace than most other developed places). And it's easy to measure how a government is actually structured (I doubt any is structurerd better for economic or personal freedom than the US other than Switzerland), but how it plays out in practice is very difficult to measure. Lots of people in different countries found out that despite what their countries governing documents or laws might say, they weren't actually as free as they thought. But it's hard to measure. How much worse should the UK be because they literally go arrest people for saying true but unwelcome things on social media? That's a big 17ing deal, but it's hard to quantify. Similarly, it's hard to measure rule of law. On paper we have rule of law, and in some areas we have it in practice, but we don't in others and it's difficult to quantify objectively.
I was just offering up a related ranking from a very Libertarian organization. The US is much higher in the ranking in the Cato report...are they FOS and the US should be lower?...or are you upset the US isnt higher for that related ranking too?
Yeah, it definitely isnt an identical ranking. And your comments about how something like freedom is measured and viewed are legitimate.
I dont know where the US should be, as I am not a sociologist, economist, or researcher. I know SPS as a whole will lean towards a natural default of USA IS A-OK and should be atop whatever rankings measure various forms of awesomeness, but being 15th in the world on such a ranking doesnt really seem terrible either.
Well, I hope SPS as a whole would lean towards the USA is not A-OK, but still better than most countries outside of a switzerland here or there. And I will say almost all of the countrires in the top quartile and a good number in the second quartile on the Human Freedom ranking woud generally be pleasant to live in. You just might be more likely to be subject to the occasional major screwing by the government (or otherwise steady small screwing). So in that sense 15th isn't bad by any means, but if you are looking at actual freedoms, I still think the US is higher on any fairly objective scale. If you want to do a scale that takes into account that we are spending ourselves into a financial crisis, that's an extremely fair criticism and most likely will result in decreased freedoms in some way but certainly will hurt quality of life when we are finally forced to address it, but how that might play out is to unpredictable and I don't think is a measure of "freedom" per se, even if it's important.
Nope, barely even a layman's understanding - that's why I came to the experts
What I don't understand is this: if computer hardware costs make up a significant portion of the AI investment (1/3, 1/2??? - I don't know), if computers generally have a 3 year useful life, how do you generate enough revenue to reinvest in compute hardware every three years to keep AI going? I don't understand the economics of this.
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The AI boom just hit a physical wall.
While the world focuses on high-tech GPUs and trillion-dollar valuations, the actual "bricks and mortar" of AI is stalling. New reports show that 50% of all planned U.S. data center builds for 2026 are now delayed or canceled.
The industry is learning a hard lesson: you can’t run the future of intelligence without a steady supply of "boring" electrical parts. Shortages of transformers, switchgear, and batteries—many still sourced from China—are creating multi-year backlogs that capital alone can’t fix.
Beyond the supply chain, the U.S. power grid is reaching its limit. With 12-16 gigawatts of capacity needed, developers are clashing with local communities and utility providers who aren't ready for the massive surge in electricity demand.
The $650 billion being poured into AI infrastructure by hyperscalers is facing a reality check. The bottleneck isn't the code; it’s the power.
And verified with (ironically) Google AI
Approximately 50% of planned U.S. data centers are delayed or canceled, with only one-third of targeted capacity currently under active construction. This bottleneck stems from severe shortages in physical electrical infrastructure—such as high-power transformers and switchgear—and limited local power grid availability, rather than a lack of compute chips. [1]
Key Drivers of Delays
Supply Chain & Industry Response
To bypass supply chain bottlenecks and overseas reliance, hyperscalers are heavily purchasing high-power electrical components from alternate markets, namely Canada, Mexico, and South Korea. Despite the grid and equipment hurdles, Big Tech companies (Alphabet, Amazon, Meta, and Microsoft) are pushing forward with over \(\$650\) billion in AI infrastructure capital commitments this year. [1, 2]
The AI boom just hit a physical wall.
While the world focuses on high-tech GPUs and trillion-dollar valuations, the actual "bricks and mortar" of AI is stalling. New reports show that 50% of all planned U.S. data center builds for 2026 are now delayed or canceled.
The industry is learning a hard lesson: you can’t run the future of intelligence without a steady supply of "boring" electrical parts. Shortages of transformers, switchgear, and batteries—many still sourced from China—are creating multi-year backlogs that capital alone can’t fix.
Beyond the supply chain, the U.S. power grid is reaching its limit. With 12-16 gigawatts of capacity needed, developers are clashing with local communities and utility providers who aren't ready for the massive surge in electricity demand.
The $650 billion being poured into AI infrastructure by hyperscalers is facing a reality check. The bottleneck isn't the code; it’s the power.
And verified with (ironically) Google AI
Approximately 50% of planned U.S. data centers are delayed or canceled, with only one-third of targeted capacity currently under active construction. This bottleneck stems from severe shortages in physical electrical infrastructure—such as high-power transformers and switchgear—and limited local power grid availability, rather than a lack of compute chips. [1]
Key Drivers of Delays
- Transformer Shortages: Wait times for high-power transformers have soared to as long as 5 years, throwing off the deployment cycles of AI facilities. [1]
- Grid Capacity: Hyperscale data center power requirements have skyrocketed from 100-megawatt builds to gigawatt behemoths, severely straining regional electrical grids. [1, 2]
- Local Opposition: There are at least 188 active community and environmental opposition groups operating across 40 U.S. states. Public pushback—due to concerns about noise, water usage, and rising consumer utility rates—led to 25 project cancellations in 2025 alone, a quadrupling from 2024. [1]
- Permitting & Regulations: Local municipalities are actively updating their ordinances and zoning laws to manage the power strain, prompting further construction moratoriums or delays. [1]
Supply Chain & Industry Response
To bypass supply chain bottlenecks and overseas reliance, hyperscalers are heavily purchasing high-power electrical components from alternate markets, namely Canada, Mexico, and South Korea. Despite the grid and equipment hurdles, Big Tech companies (Alphabet, Amazon, Meta, and Microsoft) are pushing forward with over \(\$650\) billion in AI infrastructure capital commitments this year. [1, 2]
Apparently the big companies are already generating enough profits from large scale data centers to replace those chips in 3 years, which will cost 60 to 80% of the initial construction costs. So basically huge margins to generate those returns, although it's still not clear whether they are covering depreciation on the physical infrastructure and a return on all that investment. I think everybody is assuming the demand will keep growing as comopanies figure out how to use AI to make them more profitable.
I think demand is going to continue to grow exponentially. But at some point the resources to supply that demand will run dry.
That point appears to be arriving already based on your previous post.
I highly doubt its true that they are generating that much profit. The last few days there have been a lot of rumblings about their costs. When you said high margins earlier it stuck a chord. This is not a high margin business. Its not the early internet where you write code and then sell copies at virtually no extra cost. It has insane continual costs AND easy competition. That's a low margin business, by every rule of business. I think this is why semiconductors and such took off recently, the smart money realized all the profit is in the shovels. The monopoly profits are from the chips and such, which cant be replaced with cheap knockoffs, while the AI code will be fundamentally limited by competition.
I dont know if SpaceX and Anthropic are going to crash immediately after IPO, but I guarantee there will be a ton of short positions on it. The S&P500 denying an early entry makes a crash more likely.
No, but luckily I'm not one of the people who is assigned to solve that problem.
I bet I know more about my profession than you do - that doesn't mean anything either.
Are you willing to agree that a lot of smart people with nearly unlimited resources (and motivated companies with a lot of capital already invested) behind them are working to solve the water issue? Just because you nor I can currently fathom how it can be solved, doesn't mean it won't be. That's my point. Maybe you're just too smart to think that simply.
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The data center being built in Lauderdale County will use coolant in a closed loop system and will have very little demand for water for its operation.
What is closed loop? What cools the coolant? Very little demand compared to what?
These are the newest thing, but they make repair and maintenance 10 times harder. This is no solution to the cost problem.
BUT, this type of heat exchange requires two loops. The non-water coolant is just on the equipment side. It still needs its own heat exchanger to dump the heat it picked up from the equipment. Typically, this is a water based system that utilizes evaporation to meet its BTU needs. (Closed loop water is just too inefficient). Thus, the heavy water usage.
In other words, you could do this without evaporative cooling of water, some sites do, but it takes a much more expensive initial equipment install, as the heat dump side must be a significantly larger heat exchanger to account for the lack of evaporative cooling.
I also imagine these giant cooling towers would have regulatory problems to use giant amounts of freon, that could escape.
Everything you said might be 100% correct. I really have no idea. My comments were based on what a good friend told me and he was directly involved in putting the deal together.
He appears to be correct. As I said, it can be done, its just more costly and less efficient. especially in MS, as now you are using our summer air for cooling. That's going to take massive fans and a ton of electricity, a ton of demand. The builder says they are paying for upgrades to cover the electricity, but if thats just the usage and not the demand then they aren't covering it. Ditto if thats average usage, not peak. The city should put in a demand cap, that would result in the data center slowing down on summer days.
I can't answer your questions. But this is from AI search (Gemini):
The water demand for the Compass Datacenters campus in Meridian, MS, will be virtually zero for continuous cooling. Because the site uses a sealed, closed-loop cooling system, it avoids the continuous water draw typically required by data centers.
While large-scale data centers can consume up to 5 million gallons of water daily for evaporative cooling, the Meridian facility will rely on municipal water hookups solely for minimal office and domestic use.
Environmental and Energy Study Institute (EESI) +1
Local project highlights include:
- The Developer: Compass Datacenters is developing the hyperscale campus at the Meridian I-20/59 Industrial Park in Lauderdale County.
- Cooling Method: The facility will deploy zero-impact, closed-loop cooling systems that eliminate continuous local water withdrawals.
- Infrastructure Updates: The developer is entirely financing the utility and infrastructure upgrades necessary to support the facility's immense 500-megawatt power demand.
- Timeline: The first buildings are expected to be operational by late 2026.
Office of Governor Tate Reeves (.gov) +5
It gon be loud, it gon be hot downwind.I can't answer your questions. But this is from AI search (Gemini):
The water demand for the Compass Datacenters campus in Meridian, MS, will be virtually zero for continuous cooling. Because the site uses a sealed, closed-loop cooling system, it avoids the continuous water draw typically required by data centers.
Meridian Star +1
While large-scale data centers can consume up to 5 million gallons of water daily for evaporative cooling, the Meridian facility will rely on municipal water hookups solely for minimal office and domestic use.
Environmental and Energy Study Institute (EESI) +1
Local project highlights include:
- The Developer: Compass Datacenters is developing the hyperscale campus at the Meridian I-20/59 Industrial Park in Lauderdale County.
- Cooling Method: The facility will deploy zero-impact, closed-loop cooling systems that eliminate continuous local water withdrawals.
- Infrastructure Updates: The developer is entirely financing the utility and infrastructure upgrades necessary to support the facility's immense 500-megawatt power demand.
- Timeline: The first buildings are expected to be operational by late 2026.
Office of Governor Tate Reeves (.gov) +5
I've been a little concerned about the resources being used for these centers but will be the first to admit I have done very little research on my own short of consuming the fine knowledge bombs being dropped on this here six pack site.
With that said, to add to the confusion or argument if you will, there is now an investigation into the funding and dissemination of propaganda by external enemies to ultimately slow down our progress towards AI dominance. Who knows what the real truth is but if we know one thing for sure it is sowing division by any entity or party foreign or domestic does slow down progress towards any type of improvement and adds to increasing destabilization of what made this country the greatest experiment on Earth.
With that said, to add to the confusion or argument if you will, there is now an investigation into the funding and dissemination of propaganda by external enemies to ultimately slow down our progress towards AI dominance. Who knows what the real truth is but if we know one thing for sure it is sowing division by any entity or party foreign or domestic does slow down progress towards any type of improvement and adds to increasing destabilization of what made this country the greatest experiment on Earth.
It does NOT eliminate continuous water withdrawal. It might. It might not. But many closed loop cooling systems still use incredible amounts of water. That’s the point I’m trying to make.I can't answer your questions. But this is from AI search (Gemini):
The water demand for the Compass Datacenters campus in Meridian, MS, will be virtually zero for continuous cooling. Because the site uses a sealed, closed-loop cooling system, it avoids the continuous water draw typically required by data centers.
Meridian Star +1
While large-scale data centers can consume up to 5 million gallons of water daily for evaporative cooling, the Meridian facility will rely on municipal water hookups solely for minimal office and domestic use.
Environmental and Energy Study Institute (EESI) +1
Local project highlights include:
- The Developer: Compass Datacenters is developing the hyperscale campus at the Meridian I-20/59 Industrial Park in Lauderdale County.
- Cooling Method: The facility will deploy zero-impact, closed-loop cooling systems that eliminate continuous local water withdrawals.
- Infrastructure Updates: The developer is entirely financing the utility and infrastructure upgrades necessary to support the facility's immense 500-megawatt power demand.
- Timeline: The first buildings are expected to be operational by late 2026.
Office of Governor Tate Reeves (.gov) +5
Data centers touting closed loop cooling is analogous to them claiming “it won’t be very loud.” Literally. Only the uninformed take that at face value.
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I wonder if those who stand to profit would ever holler "outside agitators!" when questions start getting asked?
Gmail, Yahoo Mail, Outlook, MS 365, Quickbooks, Sixpackspeak, MSNBC, CNN, whateverotherliberalragyouread.com, YouTube, NSA, FBI, CIA, ...and on and on. All run from data centers for decades. You don't hear any sky screaming about them. Only AI data centers. We went through this the other day. You have a short memory. The AI sky screaming is Chinese propaganda. China WILL NOT stand by quietly and let the US win the AI war.
Like I was saying, I wonder what a person who stands to profit would say...
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