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Alberta emerges as hub for artificial intelligence data centers amidst booming demand and manufacturer uncertainty #AESO #ArtificialIntelligence #DataCenters #Alberta #TurbineMarket #ComputingEfficiency
Alberta emerges as hub for artificial intelligence data centers amidst booming demand and manufacturer uncertainty
Alberta is rapidly emerging as a desirable location for artificial intelligence data centers, largely due to its advantageous tax environment and naturally cool climate – a significant factor in minimizing cooling expenses. Developers anticipate limited challenges in filling newly constructed data centers within the province, with a planned site named “Wonder Valley” slated for future development. The proliferation of AI data centers is fueling a surge in demand for natural gas turbines, a critical component for power generation. Manufacturers like GE Vernova are struggling to keep pace, with order backlogs extending to 2028. Despite the robust demand, manufacturers are hesitant to significantly expand production capacity, suggesting a degree of uncertainty about the longevity of this high-demand period. It’s noted that the full impact of AI data centers on the turbine market hasn't yet been completely realized. Interestingly, some AI developers are achieving greater efficiency, extracting more processing power from fewer resources. Canadian company Cohere, for example, has released a model functioning with only two GPUs, while DeepSeek, based in China, has trained a model with a comparatively modest 2,048 GPUs. This efficiency trend initially shook investor confidence, prompting a brief market reaction. However, the prevailing view now is that cheaper AI models will expand infrastructure use overall. The current AI boom is prompting comparisons to the dot-com era, raising concerns about potential overbuilding. A key difference is the lack of a transformative technological leap in computing efficiency, with efficiency gains primarily stemming from optimized use of existing technology. This raises questions about the risks associated with constructing a large volume of data centers should generative AI fail to meet expectations. Several companies are central to this evolving landscape, including Alberta as a proactive location for data centers, Cohere and DeepSeek demonstrating AI efficiency advancements, GE Vernova grappling with turbine demand and lead times, OpenAI driving AI research, and Sam Altman leading OpenAI.
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April 27, 2025 at 10:42 PM