DFW Texas is fast becoming a data center hot spot as AI race intensifies

Dallas-Fort Worth (DFW) in North Texas is emerging as a hot spot for data centers as the race for AI continues to gain traction as part of the United States’ plan to be the world’s leading AI hub.

Texas’ sustainable solar and renewable energy goals make it an attractive location for data centers at a time when tech firms are looking at these energy sources to sustain their data centers.

President Joe Biden recently outlined his vision to establish AI and energy infrastructure to support the increased energy consumption caused by a surge in demand for AI services. The executive order released this week aims to make data centers the cornerstone of the country’s future.

Data centers to anchor the nation’s economic development 

The order gives federal support to address the energy requirements of data centers as AI technology continues to grow. The executive order also compels federal agents to identify potential sites to develop the data centers.

“Cutting-edge AI will have profound implications for national security and enormous potential to improve Americans’ lives if harnessed responsibly, from helping cure disease to keeping communities safe by mitigating the effects of climate change,” the White House said in a statement .

The executive order came just after Edged Dallas opened its 168,610-square-foot data center in an industrial area off Loop 12 and Highways 183 and 114.

According to a CNBC article , the company indicated that it will use waterless cooling systems, solar panels, and advanced energy-efficient technologies to reduce environmental impact on local resources.

“As data centers become critical infrastructure supporting communication and commerce, Edged Dallas leads the way in powerful and sustainable performance.”

~ Edged Dallas

Its use of waterless cooling systems and solar panels addresses some of the challenges linked to high energy and water consumption needs to cool AI servers.

Texas actively attracting energy investments 

Stakeholders have also argued that Edged Dallas’ sustainability goal is critical as data centers become more common in the US. AFW is fast becoming one of the hot spots in the region, ranking as the second-biggest data center market in North America.

“The energy industry views Texas as a friendly place to build. You can get land, you can get permits. You can build both the generation to supply electricity, as well as the large loads, the data centers, or manufacturing facilities. So that is a factor,” said Rob Gramlich, president of Grid Strategies, an economic and engineering consulting firm based in the Washington, D.C. area that studies electric power systems and transmission.

The growth is not only in Irving. According to CNBC, real estate firm Lincoln Property Company, fiber internet provider Gigabit Fiber, and investment firm Tradition Holdings announced that a new $1 billion data center is currently under construction in the Red Oak area south of Dallas, along the I-35 corridor.

Tech giants like Google are leading projects there, solidifying North Texas as a hub for tech innovation.

As the AI sector continues to grow, the focus will remain on balancing economic benefits with environmental sustainability. Notably, Texas is also attracting investments in cryptocurrency mining on top of AI developments.

Texas trying to balance AI growth with energy and environmental sustainability 

Outside Texas, the entire United States has become very competitive in attracting data center companies looking to secure the tax revenue and job opportunities that these facilities provide. However, concerns persist about their energy-intensive and heat-generating nature.

According to a study by Lawrence Berkeley National Laboratory, US data center demand could nearly triple in the next three years, potentially consuming up to 12% of the country’s electricity.

The report’s lead researcher Arman Shehabi indicated that knowledge of the estimated energy use was critical in showing the available opportunities.

“By showing what the energy use is and, more importantly, what’s causing the growth in energy use, it helps us think about what opportunities there are for efficiencies.”

~ Shehabi.

Another report by Grid Strategies shows that electricity demand in the US could rise 128 GW over the next five years, driven by data centers and manufacturing growth. This estimate represents a five-fold increase in loan growth forecasts over the past two years.

“The environmental footprint is an issue that localities and states are looking at,” said Rob Gramlich, president of Grid Strategies, a consulting firm focused on electric power systems.

Texas’ growth in data center development is also complemented by its renewable energy goals. According to CNBC, many tech companies are turning to wind and solar power to meet their sustainability commitments, further fueling renewable energy development across the country.

Apart from powering AI advancements, data centers are also critical in helping improve various industries, including electricity management.

“These data centers are enabling a lot of the things we do with our phones and technology every day. In some sense, everybody does benefit to the extent they’re using any of that or using the internet in any way,” Gramlich said.

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