Facebook’s parent company, Meta announced on Wednesday that it is bringing the largest artificial intelligence data center it has ever constructed to northeast Louisiana, raising expectations that the $10 billion project will revitalize a region of the state that has been ignored economically.
Although some environmental groups have expressed concerns about the center’s reliance on fossil fuels and whether the plans for new natural gas power to support it could result in higher energy bills for Louisiana residents in the future, Republican Governor Jeff Landry called it “game-changing” for his state’s growing tech sector.
The chamber of commerce in Memphis, Tennessee, said on Wednesday to BrandSpur digital news platform that Elon Musk’s artificial intelligence business, xAI, is growing its current supercomputer project there.
Without providing any other information, the chamber also stated that Nvidia, Dell, and Supermicro Computer would be “establishing operations in Memphis.”
A rising number of states, including Louisiana, are enticing large tech companies looking for locations for energy-intensive data centers with tax credits and other incentives. Citing industry projections, the U.S. Commerce Department concluded that the country’s data centers are unable to handle the growing demand driven by artificial intelligence, which is expected to increase by 9% year until 2030.
According to Kevin Janda, head of data center strategy at Meta, the company expects its Louisiana data center to generate 5,000 temporary construction employees in addition to 500 operational jobs. He noted that it will be the company’s largest AI data center to date, measuring 4 million square feet (370,000 square meters).
Continuing, he had this to say: “We want to make sure we are having a positive impact on the local level.”
Local lawmakers and congressional leaders from all political parties hailed the Meta plant as a blessing for Richland Parish, a 20,000-person rural area of Louisiana that has historically relied on agriculture.
According to U.S. census data, the parish has an employment rate below 50%, and around one in four persons are regarded as living in poverty. To make up for its water use, Meta intends to spend $200 million on enhancements to the parish’s water and road systems. It is anticipated that the facility will be finished in 2030.
One of the biggest utility companies in the country, Entergy, is moving quickly to construct three natural gas power plants in Louisiana that will have the potential to generate 2,262 megawatts for Meta’s data center over 15 years. This is about a tenth of Entergy’s current energy capacity spread over four states. Since some environmental organizations have resisted tying the state onto further fossil fuel-based energy infrastructure, the Louisiana Public Service Commission is considering Entergy’s plan.
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According to Meta, it intends to assist in the future grid integration of 1,500 megawatts of renewable energy. When Meta’s contract with Entergy expires, residents of Louisiana might eventually have to pay higher rates to cover the cost of running these natural gas power plants, according to Jessica Hendricks, State Policy Director for the Alliance for Affordable Energy, a nonprofit organization that supports energy consumers in Louisiana.
The State Policy Director went on to say: “There’s no reason why residential customers in Louisiana need to pay for a power plant for energy that they’re not going to use”
“And we want to make sure that there are safeguards in place,” he added.
Foster Campbell, the Public Service Commissioner for northeast Louisiana, stated that he sees the data center as essential for his area and does not think it would raise prices for Louisianans. He said: “It’s going in one of the most needed places in Louisiana and maybe one of the most needed places in the United States of America. I’m for it 100%.”
Environmental organizations have also issued warnings about the pollution that Musk’s AI data center in Memphis is causing. The Environmental Protection Agency is taking notice of the supercomputer’s potential to put a strain on the electricity system, according to the Southern Environmental Law Center and others.
