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Long time listener, first time caller.
The war on AI datacenters (and normal ones as a bit of collateral damage) has been going on for a little while now, with those opposed fiercely fighting a lot of these projects pretty much wherever, whenever. It seems to be one of the most bipartisan issues facing the country right now and those who are pro-datacenter have been effectively politically slaughtered. As of a few days ago though, there seems to have been a small little flash point in the thing. I haven't really seen a thread here about this (although definitely could have missed one), and I'm actually a little surprised at it since I do think this is probably one of the biggest culture wars in America of this year. Anyway, curious thoughts on this, etc
From what I can tell, the flashpoint was yesterday when Axios reported (and later posted) a letter from the Ohio RNC to AI companies effectively calling being pro-datacenter politically radioactive. It kinda exploded at this point over Twitter and later Greg Abbott put a thing out about it yesterday after enacting a pause earlier this month. Basically the only one who didn't respond in a politically obvious way was Trump in a presser who was quoted as saying "if I were the mayor of a town or the governor of a state, and I had a chance to get a big plant in, an AI plant or a data center." I think this quote right here might be the worst strategic blunder since the Iran War. If I were the DNC, the clip would be on every station in the country
The reaction to these things are incredibly understandable. Their argument effectively goes "they use our water and electricity, provide a service to enhance the surveillance state and the interests of Big Tech, their proponents openly admit that they're gonna take your job, they bully communities, and they don't even pay taxes either, all the while poisoning the communities they leech on with pollution and noise." Personally, I'm honestly quite surprised that political radioactivity is the biggest thing that has happened so far. This seems to be an issue that unites people regardless of political party or affiliation...
...probably because it's being correctly seen as a existential threat to people's lives and livelihoods. Polling against datacenter construction is incredibly poor, arguably being worse than coal or nuclear power plants (yeah I know, different surveys). I think this, if I were to pin a spark on this (there are many), it's the story of the Memphis xAI datacenter and also the lawsuits against Solon Township to effectively bully them into allowing the project. Communities, seeing what happened there and politically, have somewhat backtracked quite a bit where before they were much more open to it. Some of those that haven't are proactively enacting outright bans
If this culture war has one side, who is the other? Silicon Valley, billionaires, etc, seems to be the obvious answer here.
Both Altman and Amodei screwed up public perception big time, although I don't think it's 100% their fault. I imagine though this is basically because they're put in a double bind. If it isn't absolutely economy ending for every other company, the trillions pumped into their valuation will vaporize faster than you can say "AGI," but people tend to believe (correctly so) when someone threatens them (and have especially checkered pasts as both these guys do), that their threats are genuine, so when those PR puff pieces trickle down to the public at large.
The All In guys have tried to pin this on Amodei in particular, but I think some people just see that as them talking their book
They've tried to label the opposition as "China," but that clearly doesn't make much sense given that the problems are genuine. Cremieux has tried to take up the mantle on the issue, but I think people see his arguments are seen as specious and as relying on theoreticals that don't match observations on the ground, and this has I think backfired
Expect to see more bans and moratoriums happening across the country. Will be interesting to watch. Thoughts?
I can only speak for the data centers I've been involved with, but it has amazed me how little effort has been put into trying to counter or at least mitigate the most excessive claims of critics. Frankly, the complacency of these tech companies is kind of driving me crazy, though I have some ideas I want to push. We don't need to make people like data centers, we just need more people to utter the words "I don't like data centers, but..."
I'll paraphrase something I read on Twitter recently: Currently, 80 IQ cartel narcoterrorists have a better idea of civic duty that the tech oligarchs. When your town gets taken over by the cartel, at least they bring electricity, hospitals, running water, and a level of stability. Because even the lowest scum drug runner knows that they need to at least give something back to the community they exist in. Tech oligarchs will go into a community, drive up utility prices, and call anyone who isn't enthusiastically supportive a luddite who deserves to rot in the permanent underclass. In this way, the drug cartels are closer to the likes of John D. Rockefeller than anyone alive in Silicon Valley.
The problem with this is the electricity rate increases haven't actually materialized. They're all projections. And future impacts, in theory and in practice, fairly easy to avoid; the permitting authority has to structure things so the data center pays their own way. This should not be that hard, the data center builders currently have a lot of cash to throw around. So it amounts to a opposition talking point, like the water.
I work in energy (electricity) and this is part true and part untrue. Yes, electricity prices have gone up modestly, with bigger increases projected in the next 5 years.
The reasons prices are set to increase is that we are really slow to put new generation on the grid. And the amount of data centers under construction, let alone planned, is much bigger than what is already operational.
It’s a very simple supply and demand function. Load increases faster than supply. DCs buy power through PPA contracts directly with generators. But that crowds out offtake from the generators that would otherwise go to merchant markets or supply agreements with utilities.
We are average at best at building new power supply.
I expect retail electricity prices to be electoral politics by 2030, maybe even 2028.
This feels somewhat constrained to the local regulatory environment. We can just make investments in the grid faster. In the last two decades, total US nameplate capacity is up 20-30%, while ERCOT (Texas) is up over 100%. They don't want you to know this, but you can just build things: Texas is more friendly to renewables than California these days!
But Abbot says there's too many applications for new power connections so he's not going to consider any of them. Brilliant move. Politically, anyway
I think Abbott is at least partially swaying with the political winds here, but ERCOT's 100% increase in the last two decades pales in comparison to their forecast of 300% growth in the next 6 years. I think there are probably legitimate questions of capacity buildout at much higher rates than baseline, and "not committing to anything further" doesn't sound entirely foolish.
On the third (gripping) hand, I really question the hyperscaler economic case where they're able to pay N times the current price for huge amounts of energy, but the proles will still have enough money to pay them for AI services and for utilities. I don't know about everyone else, but "paying to chat with Claude/Gemini/ChatGPT" falls pretty low on Maslow's heirarchy of needs for me, well behind "keep the lights on and HVAC going". Even if they expect B2B to pay the bills, consumers are still an important part (ultimately, the endpoint) of the economy: it can't be B2B all the way down. Models are getting more efficient and I somewhat expect that quite a few use cases need less hardware than currently forecast.
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