Data centres are hungry for power, and Alberta is pitching itself as the place to build

The province of Alberta is trying to establish itself as a major destination for the construction of data centers in North America.

Two of Alberta's cabinet ministers traveled to Silicon Valley last week to promote the province as a "prime location" for the construction of physical buildings that store and process our digital information.

Big tech companies are looking for power around the world, and this province isn't the only place looking to attract data center investment.

Alberta also faces some challenges compared to other U.S. provinces and states, including questions about how much pollution its natural gas-fired electricity grid produces now and in the future.

The opportunity is huge and the province has a unique offering, but there are also questions about the overall impact of building the power-intensive centers needed for the growing AI sector.

While some cabinet ministers welcome the huge investment opportunity, others are more cautious about the ultimate consequences for the province.

"We are facing challenges in our electricity system right now," Alberta Finance Minister Nate Horner said, expressing concern about the unintended consequences that could affect electricity bills.

"You really have to understand what the return on investment is going to be for the province," he said. That's why we're looking into it."

Striving to become Canada's best spot

Experts say that currently, most Canadian data centers are located in Ontario and Quebec due to the large population of these two provinces. Quebec's cheap electricity, which comes mostly from hydroelectric power plants, has also helped attract investment.

There is strong demand for more data centers in Canada from two sources: cloud service providers and artificial intelligence companies. Data centers are filled with rows of computers and other machines used to store almost anything on your phone or computer, such as photos, music, and more.

Cheap natural gas is a selling point, says Michael Blanki, CEO of Entropy, a Calgary-based decarbonization company, and there's also underground space to store carbon emissions.

Alberta has formed a cabinet task force that aspires to become Canada's best place to attract profitable technology installations. State Technology Secretary Nate Globish was one of the politicians who traveled to Santa Clara, California. This is his second trip to Silicon Valley this summer.

"This is a great opportunity to promote Alberta as a premier location for AI data centers," he said in a statement announcing his visit.

Currently, some companies are investigating this province.

Pipeline operator TC Energy says natural gas deliveries have increased as electricity demand has increased.

Alberta needs to build more power plants and produce more natural gas to power all these computing machines. These spin-offs could include more job creation, tax revenues and royalties collected by the provincial government for all natural gas extracted from the ground.

Michael Blanki said: "The demand for electricity is currently increasing rapidly in the world with the electrification of everything. But at the same time, it has intensified with the evolution of data centers and artificial intelligence.

"There's an arms race for growth," said Blanky, whose company recently signed a deal to power a new data center with a natural gas plant and a carbon storage facility.

Due to privacy and competition concerns, Blanki can't reveal the company's name or even its location.

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