Google said it would halt plans to develop a $200m data centre in Chile over environmental concerns. The decision comes months after a local court reversed the company’s permit in February, and asked Google to account for the effects of climate change in its application.
A statement from the company said, “A new process will start from scratch […] Sustainability is at the heart of everything we do, and the way we design and manage our data centers is no exception.”
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Chile has been facing a decade-long drought which has been exacerbated by climate change, a factor that has caused major pushback amongst locals and Indigenous groups.
Data centres are power-hungry and water-intensive. Research suggests that around 700,000 litres of water could have been used to cool the machines that trained ChatGPT-3. Economist Mariana Mazzucato has expressed worry over this before, saying that tech companies “may opt to base their datacentres in regions with cheaper electricity […] potentially exacerbating water consumption issues in drier parts of the world.”
The company first obtained permits for the project in 2020. With the dawn of generative AI, demand for data centres has skyrocketed worldwide.
Data centres and FDI
Earlier this year, Khazna published a report outlining how data centres could be key to attracting FDI.
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By GlobalDataThe report outlined how building key tech infrastructure could give countries a competitive advantage as the cloud computing and generative AI sectors continue to grow. The report highlights that revenue from the generative AI industry could reach $1.3tn by 2032.
Europe has taken a big chunk of global FDI being spent on data centres. Of the $44.8bn of FDI spent on data centres in 2022, $20bn went to Europe.
Firms will likely continue to seek out locations where energy is more affordable to develop these projects. The pushback in Chile shows that environmental considerations, long term sustainability, and integration with local populations must be central concerns for companies looking to build tech infrastructure.
