Data Centers -- Bloomberg's Take -- May 26, 2024

Locator: 47183TECH.

I have no interest in the commentary or opinion or the writer's two-cents-worth of comments, but the magnitude of these data centers is quite incredible. 

I look at these stories through my technology-filter spectacles. Would that be a Vision Pro?

Link here. A Bloomberg product.

Tax breaks for data centers aim to attract jobs to areas of the country with high unemployment. Despite their evident shortcomings, they remain a popular choice for state legislatures—and it seems like a data center tax break arms race is under way. But states should tax data centers more to offset the strain they place on local infrastructure.

Data centers place massive burdens on infrastructure and local resources such as electricity and water, and artificial intelligence is set to increase those burdens exponentially. Exact details on data centers’ resource use can be difficult to find, but the small peeks we’ve had have been astonishing.

Alphabet Inc. data centers (i.e., Google) in The Dalles, Oregon, used 355 million gallons of water in 2022. At an Environmental Protection Agency estimated 82 gallons of water used per day at home, that equates to the water use of nearly 12,000 individuals.

• population, Oregon: 4.3 million; x 82 gallons = 353 million gallons,
• or the data center used almost the exact amount of water over the entire year that Oregonians used in one day.
• hardly seems concerning. And that's why the data center was placed where it was placed: plenty of water. Would one prefer putting that same data center in New Mexico, Arizona, or west Texas?
• we heard the same water concerns with fracking years ago;

In terms of electricity, data centers consume an estimated 1% to 2% of worldwide power usage, and that may rise as high as 4% by the end of this decade.

• again, from an investor's point of view -- wow. By the way, this is why smaller blades are so incredibly important --
  
• think Nvidia -- smaller blades use less electricity, generate less hear requiring less water -- again, from an investor's point of view.

Evidence that data centers drive job creation simply isn’t there. The data we do have, while several years old, indicates they create few jobs and cost about $2 million for each they do manage to conjure up.

• from an investor's point of view -- awesome -- data centers must have huge, huge profit margins if personnel costs are low.

Data centers are much more energy-intensive than labor-intensive. Their resource usage may drive up resource costs and shift financial burdens to other resident businesses and individuals—both in the tax loss from the data center and the higher costs of electricity and water.

• this is definitely true -- as we are seeing western North Dakota, and possibly eastern North Dakota as well. Investors? Utilities.

Tax breaks for data centers are a fortunately rare phenomenon (so what's the problem?) —tax policy that is precisely wrong. Tax breaks for data centers represent misguided state fiscal strategy, and the tide must be stemmed before more states succumb to the mistaken notion of “investing” in data centers with taxpayer money.

—Andrew Leahey, The Exchange

 

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Back to That Columbia River 

The numbers:

• 265,000 cubic feet = 2 million gallons
• this is per second
• Alphabet data center: 355 million gallons of water over one year
• 355 million / 2 million (one second) = 178 seconds worth of water from the Columbia that would have otherwise run into the ocean. 178 seconds.
• and, oh, by the way, most of that water was diverted back into the Columbia River after "used" by that Alphabet data center
• in other words, the Columbia River water is simply a revenue generator for its owner. 
• so much more could be said but this is enough for now

Disclaimer: I often make simple arithmetic errors. In a long note like this, there will be typographical and content errors.