The United Conservative Party Government must be encountering stiffer opposition than it expected to its plan to make Alberta North America’s dumping ground for the Artificial Intelligence data centres that citizens most everywhere else are organizing to fight.
Consider the slick propaganda section that’s appeared on the Government of Alberta’s official website, which bizarrely tries to pass off water- and energy-gobbling hyperscale data centres as “digital refineries.”
The site’s first goal is obviously to get voters on side with the massive Sturgeon County data centre planned by Meta Platforms Inc. a few kilometres northeast of Edmonton.
When it was announced in Calgary on July 4, the government and company said it would cost $13 billion and be the largest AI data centre in Canada. But it didn’t take long for anxiety about the project, and the $100 billion the UCP hopes to see spent building data centres throughout Wild Rose Country, to start giving lots of Albertans the willies.
Waxing poetic about the inevitable and happy future of AI data centres in Alberta, the microsite within Alberta.ca has the look and feel of something developed by communications consultants from outside the province. Maybe they thought folks here are yokels, who ought to be easy to fool.
“What is a data centre, really?” it asks patronizingly. “When people say ‘the cloud,’ they mean a data centre. There is no cloud. There is just somebody else’s computer, in a big building, doing work on your behalf. AI data centres are the next generation of the same infrastructure. Instead of mostly storing information, they are built to think.” (Do you think they asked AI to write this drivel?)
Straining logic only a little, the website advises readers just to think of the 700-plus-hectare 24/7/365 operation planned by Meta and the massive separately owned natural-gas-fired power plant nearby to power it “as digital refineries.”
For 50 years, the authors (be they humanoid or digital) tell us, Albertans have asked: “Why don’t we refine more of our own resources here at home?” (This remains a good question, actually.)
“Alberta produces about 60 per cent of Canada’s natural gas,” story time continues. “A data centre refines that gas, in stages, into the most valuable commodity of our time. Gas becomes electricity. Electricity becomes computing power. Computing power becomes intelligence: the answers, predictions and tools the world is buying.”
“Then the product ships through fibre optic cable, at the speed of light. A digital pipeline that crosses borders without a decade of regulatory battles, carries the finished product instead of the raw one, and never sells at a discount.” (The real finished product, dear readers, is my prose and yours, scraped from the Internet without so much as a by-your-leave. That’s what we used to call a five-finger discount!)
If this kind of derp makes you think of what a cryptocurrency telemarketer might sound like, you’re probably onto something.
For the most part, the rest of the site falls back on the same tendentious talking points the government and a Meta spokesperson trotted out at their July 4 news conference.
The plant won’t use a lot of water because it will have a closed-loop cooling system. (OK, but what about the gas-fired power plant next door?) Data centre operators in Alberta must provide their own power so your rates won’t go up. (But Meta’s plant is supposed to draw some power from the de-regulated provincial grid – so what about the law of supply and demand?) Don’t worry about the AI bubble bursting, private investors are carrying all the risk. “When any facility reaches the end of its life, the company that built it is responsible for decommissioning it.” (You know, just like all those unfunded orphan wells.)
Do you have questions about the regulatory side of this industry? Well, never mind. They aren’t addressed by this spin site. Like the cloud, I guess, there are no answers.
What is obvious is that the UCP very badly wants you to think there is no downside to AI data centres. It’s worth asking why.
In fact, there are many persuasive arguments for Alberta to pause and think carefully about the environmental, social and financial impacts of these water and power greedy megaprojects. But a recent poll suggested most Albertans have not yet cottoned onto those concerns. So it was probably inevitable the UCP would turn up the pressure on this sales job while Albertans were still unsure of what to think.
The Léger polling firm’s online survey of 1,000 Albertans was in the field from July 17 to 19, asking respondents what they thought about the Sturgeon County facility. Léger found that right now more voters support the project than oppose it – thanks, no doubt, to the government’s heavy promotion.
When Léger asked what Albertans thought of the project based on what they knew, “support outweighed opposition, though not by a wide margin: 44 per cent supported the project, 36 per cent opposed it and 20 per cent were unsure or had not heard enough,” the pollster said.
But when the pollster added in the province’s talking points, including dubious claims the centre won’t use much water, that it will create lots of construction jobs and a few permanent ones, and that Meta will build and pay for energy generation, “with that fuller picture, 57 per cent described the project as a good deal for Alberta, compared with 27 per cent who considered it a bad deal.”
But those numbers aren’t good for the UCP if you consider that as Albertans start to hear arguments against the Meta data centre and others like it, the dial on public perception of the project will probably move again.
As for the supposedly rosy future of AI, just because it can do interesting things doesn’t guarantee it will return profits to its investors, Nobel Prize winning economist Paul Krugman warned on Wednesday.
“The huge capital expenditures we’ve been seeing by AI and AI-related companies were only justifiable if (a) AI delivers big economic payoffs – which even pathbreaking technologies don’t always do – and (b) first-movers are able to capture a large share of those returns, rather than find them competed away by second-movers offering products that are cheaper and almost as good,” Dr. Krugman wrote on his Substack last week. “In this case that especially means Chinese companies with lighter-weight models that use much less compute but do most of what ChatGPT and Claude do for a much lower price.”
He suggested that “the triumph of hype over experience” is about to come to an end. But not in Alberta, the UCP clearly hopes.
On Thursday, The New York Times fretted that Wall Street is getting “the jitters” about how much Amazon, Google, Meta and Microsoft are spending to build data centres – “a staggering $1.5 trillion.”
“Alarms are rising as Wall Street and others question when this spending can be justified,” the author wrote in that understated way Times editors encourage.
So are AI data centres, as the UCP tells us, soon going to be “turning Alberta energy into something the whole world is lining up to buy”? I dunno. But didn’t they just tell us the same thing about Bitcoin mining?
