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Microsoft, Data Centers and the AI Paradox

Can generative AI and the acres of servers needed to refine large-language models help solve the very problem it creates?

Source: Microsoft

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By George Leopold

Taking a page from Bitcoin miners constantly seeking cheaper power sources, Microsoft Corp.’s planned $3.3 billion investment in Wisconsin represents the next wave of data center expansion driven by generative AI.

The massive project, which is also being promoted as a jobs creator, is nevertheless bound to strain power grids already groaning under the weight of surging electricity demand.

With data center hubs like Northern Virginia approaching full capacity, and quickly running short of power, Microsoft and other hyperscale cloud providers are eyeing new locations away from the coasts as electricity demand soars. The rise of generative AI and the resulting explosion of new server farms required to handle large-language models are expected to drive demand for electricity through the roof.

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