Was 2025 the year of the Datacenter?
Higher electricity bills, noise, health risks and "Generative deskilling" are coming. We'll also reach more absurd levels of capital allocation, concentration risk and nefarious lack of transparency.
Good Morning,
When all is and done, 2025 saw a significant increase in major AI datacenter projects, clusters and infrastructure. It’s easily one of the biggest trends in AI of 2025.
This year we have seen a tidal wave of AI Infrastructure. But what will be the price for society? In 2025, the aggregate capital expenditure (CapEx) for top Big Tech hyperscalers is estimated to be over $400 billion, primarily driven by investments in AI infrastructure and data centers by BigTech and Cloud hyperscalers.
Products like ChatGPT being adopted at scale will likely lead to a lower value of a College education, less human connection and less time spent reading. Is that good for society? 🤔 Is that the sort of world we think is healthy for consumers and our younger people? I’m not sure the benefits of chatbots even outweigh the costs.
ChatGPT leading to less Reading Time
YouTube, TikTok and especially ChatGPT are impacting reading time among our youngest teenage citizens. The impact on College age Americans is likely even more striking with ChatGPT use.
Less reading time
Less human connection
Less stable white-collar career ladders
Higher electricity bills
More noise pollution for local communities
More AI spam and AI slop on the internet
Less human and real social media (as if that were even possible)
More authoritarian use of AI by Governments, big corporations, tycoons, dictators and elites to serve their own agendas
Mixed Capital Expenditures and Confused Policy
We also have problematic supply chains and an energy grid that isn’t prepared for this AI Infrastructure roll-out.
According to datacenterwatch.org, there has been recently $162 𝐁𝐢𝐥𝐥𝐢𝐨𝐧 worth of data center projects in the US have been stalled or cancelled over the course of a year, with 60% in the latest 3 months. It’s not just supply chain issues, people and local residents are protesting Hyperscalers and their manipulation of real-estate and local politicians. Americans locally at least, are starting to oppose in greater numbers these Datacenter projects in their communities.
The Dark Side of Datacenters in America
Business Insider did a documentary (it’s over 30 min) on this that really got me thinking. BigTech isn’t being transparent about their datacenters or their plans. Meanwhile the U.S. Government and the Trump Administration is trying to hasten the advent of these datacenters. Just like chatbots hurting the career ladders of young people, they are pushing something most citizens and people don’t want.
Higher Electricity Bills will Push Affordability Crisis
I read several reports on AI in 2025 with surveys that clearly showed regular workers and citizens aren’t positive about the impact of AI. With an affordability crisis and weak labor market taking shape in the U.S., higher electricity bills aren’t welcome either. Data centers significantly raise electricity bills, with some areas seeing costs jump dramatically (up to 267% higher in places with heavy activity) due to massive energy demand from AI, while national averages see increases of 30%+ since 2020. projects peg for further electricity price hikes of 8-25% by 2030, as utilities pass costs onto consumers and struggle to build new infrastructure, though factors like grid management and local investment also matter.
There’s clearly something wrong happening in America about Generative AI and around datacenters in particular. There’s a fairly good reason BigTech are trying to hide and bulldoze their activities. They accelerate power demands on the grid, imbalance water risks, hurt the health of residents near the infrastructure and many other toxic consequences.
The SPEED ACT is a bill against the people as major corporations push their agendas and products, even when adoption is surprisingly poor. Lobbying and how comprised this Administration appears to be means the bill cleared a crucial procedural vote 215-209 on Tuesday in the House and I fear for what this will mean for the bottom half of Americans live in a K-shaped semi-perma post pandemic economy. Quality of life may continue to degrade in terms of affordability as the labor force weakens with multiple environmental and risks to the cost of living. This can’t be American the Brave or America the Free. Datacenters are becoming a symbol of this deterioration, nevermind the environmental concerns.
The SPEED Act would blunt the 1969 National Environmental Policy Act, which mandates federal reviews for projects that could affect the environment before permits are issued. - per CNBC.
The Backlash
Republicans on Capitol Hill who have championed the tech industry’s race to dominate artificial intelligence are confronting a growing political obstacle: voters angry over the soaring energy demands and utility costs tied to the data centers. - per Politico.
2025: the Year AI Infrastructure Made AI Political
Even Republicans are starting to distance themselves from a Trump Administration in league with BigTech lobbying and the will to dominate of corporate elites. Florida Republican Gov. Ron DeSantis floated new limits on data centers as part of an “AI bill of rights.” Georgia Rep. Marjorie Taylor Greene and Missouri Sen. Josh Hawley have also questioned Trump’s state preemption drive. But I’m not sure American voters even understand the magnitude of the threat on their independence.
The U.S. has a huge First Mover Advantage in Datacenters, Compute and AI Chips
America’s stranglehold on “AI Supremacy” may be temporary
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