5 ms·

To me, datacenters, especially for AI (which tolerates an extra hundred ms of latency quite well) seem like an unusual form of development. Many forms of develo

by amluto 5mo ago

To me, datacenters, especially for AI (which tolerates an extra hundred ms of latency quite well) seem like an unusual form of development. Many forms of development have similar downsides: they destroy green space, they can be noisy, they compete for energy resources [0], etc. On the flip side, though, most new developments add substantial value: jobs, tax revenue, increased industry around them, local availability of their outputs, etc. Datacenters are weird: they come with the negatives (although, per unit energy consumption, they’re relatively innocuous), but they seem to be missing most of the regional benefits. They don’t create many jobs. They pay little in taxes. They don’t actually produce anything that makes anyone else want to further develop the surrounding area. Their outputs offer little benefit to the community that wouldn’t be provided nearly as well by a datacenter somewhere else. So I actually get why it makes sense to support development but oppose new datacenters. Or to have an added tax on datacenters so that at least some economic benefit is captured. As an interesting contrast, a colo facility is a bit different: I want to have colo datacenters near by so that I can use their services. But this isn’t what the new development is about. [0] Some of which are finite in a given region or are preferable not to use. (But don’t forget that more energy use = increased production in the long term, which can be a very good thing.)

morpheuskafka 5mo ago
A warehouse or factory would have more jobs, but would also bring massive truck loads to the local roads and corresponding pollution. The low staffing of datacenters means that one they are built there is little transportation impact.
- thefz 5mo ago
  And there is almost zero value generated locally.
  - tartoran 5mo ago
    The tax will address that.
- znpy 5mo ago
  > A warehouse or factory would have more jobs, It would add low value-added jobs though (unskilled labor). Datacenters add high value-added jobs (skilled labor). Only looking at the headcount is shortsighted imho.
  - oblio 5mo ago
    Aren't DC remotely managed for almost everything? How does a DC in Paris, Alabama benefit the locals if 99% of the well paid jobs for it are done in the Bay Area?
    - condis 5mo ago
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      - Rekindle8090 5mo ago
        [dead]
  - eqvinox 5mo ago
    > Datacenters add high value-added jobs (skilled labor). The highest skill job an AI datacenter adds locally is electrician or climate technician. And not many of those.
vessenes 5mo ago
Why don't they pay much in taxes? hyperscalers are pretty profitable.
- zdragnar 5mo ago
  The hyperscalers aren't making sales directly from the data center, so there's not much to tax other than the land value, the electricity they use, and the few employee salaries. You'd need some sort of data ingress/egress tax.
  - oersted 5mo ago
    The idea of having what equates to trade tariffs for data transfers sounds horrifying. But to be fair, we are kinda suffering similar charges already from all major cloud providers, and we seem to be okay with it... Still horrifying, but not entirely unprecedented I suppose.
  - vessenes 5mo ago
    Interesting. Just checked some numbers. So Coreweave has like $3bn in operating cashflow last quarter. Your point is that after we are done with all the capex/interest rate deductions/etc and look at a steady state business for a given CoreWeave datacenter, that net income won't be marked locally to a given datacenter. Is that true though? If a Delaware corp is operating in most states, I believe they must file as a foreign corporation in that state; I'm surprised GAAP would not require them accruing some of this income to the locations that provided the work to do the income.
- palmotea 5mo ago
  > Why don't they pay much in taxes? hyperscalers are pretty profitable. I wouldn't be surprised if those profits are re-imagined as costs paid to some entity in a tax-haven. Also there's different kinds of taxes. IIRC, local communities get their revenue from sales taxes and property taxes. A data center doesn't sell anything, so they probably get zero from that. I don't really know how they'd factor into property taxes, because they're a blight and I don't know how the locality would assess their value without comparable transactions.
oersted 5mo ago
I'm confused, do they really have such an impact? They are of course big and expensive, but surely most datacenters are relatively innocuous in terms pollution and general disruption to the area compared to any regular heavy-industry site, right? Please let me know if I'm wrong, I'm not sure. EDIT: I do get it, it is mainly about local benefit not really about pollution or disruption, even if they are loud about that because it sounds better. Local municipalities should definitely charge significant land rents or zoning fees so that the community benefits. China has been very successful at this for decades. EDIT: Very rough overview after some research, using Colossus 1 as reference, which is among the biggest GPU deployments. Not thoroughly verified, but it'll be around the right ballpark. - Electricity: 150 MW live, with another 150 MW planned/studied. That is like adding a medium electric-arc steel mill or large chemical plant to the grid. A small standard power-plant can generate about that much. - Land / space: About 217 acres and 785,000 sq ft. Footprint-wise, that is like a large factory campus or logistics park; much smaller than a mine, port, refinery, or industrial farm, but far beyond a normal commercial warehouse. - Water: Roughly 1.3–3M gallons/day in public estimates. That is comparable to the consumptive water use of a small-to-mid steel plant or a large industrial cooling site; not refinery-scale, but locally significant. - Air pollution: The servers are not the dirty part; the issue is on-site gas turbines/generators. That makes it more like a small gas peaker plant than a steel mill or chemical plant. Colossus 1 reportedly used up to 35 gas turbines before grid connection. - Noise: Mainly cooling equipment, substations, batteries, turbines/generators. More like living near a substation or small power plant than near a mine, port, or metalworks. - Traffic / logistics: Heavy during construction, then relatively light. Much less disruptive than a port, mine, farm, steel plant, or refinery, because there is no constant flow of ore, scrap, fuel, chemicals, crops, containers, or waste. - Heat: Nearly all consumed electricity becomes heat. At 150–300 MW, the heat rejection is industrial-scale, closer to a small power station / large process plant than normal manufacturing.
- toyg 5mo ago
  Heavy-industry sites are also extremely discouraged across Europe, outside of very specific zones. If anything, the current shift is about bringing datacentres in that same category.
jmyeet 5mo ago
It's worse than that. Data centers aren't a net zero for the area, they're a net negative. They use up water, arguably pollute said water [1], they jack up the price of everybody's electricity (because everyone else ends up paying for the extra infrastructure), can cause pollution directly (eg xAI runs highly-polluting gas turbines in a city through a legal loophole of them being "mobile" [2]) and aren't the quiet, unseen facilities proponents make them out to be (eg [3]). On top of all that they typically get massive subsidies and tax credits. Why? Because the DC might go somewhere else, allegedly. Where? Nobody wants it. Everybody knows the politicians approving all this are getting bought or just coerced. I'd love to see a single example of where one of these data centers was welcomed by the community or somehow a net positive. [1]: https://www.bbc.com/news/articles/cy8gy7lv448o https://www.bbc.com/news/articles/cy8gy7lv448o [2]: https://earthjustice.org/case/xai-illegal-gas-power-plant-data-center-colossus https://earthjustice.org/case/xai-illegal-gas-power-plant-da... [3]: https://www.nbcwashington.com/news/local/northern-virginia/neighbors-raise-concerns-about-noisy-data-center-in-loudoun/4080249/ https://www.nbcwashington.com/news/local/northern-virginia/n...
znpy 5mo ago
> they destroy green space the law addresses exactly this. it greatly overtaxes datacenter in green spaces and lowers taxes in former industrial areas. Regarding whether it's a good development drive... I can tell you, most companies could save a shitload of money by buying a few pallets of machines and racking them in a... datacenter. I see our monthly AWS bill, I highly doubt we'd be spending that in datacenter bills.
sieve 5mo ago
> Datacenters are weird In the same way that most public utilities are: train stations, railway lines, airports, garbage dumps, sewage treatment plants, military bases and a hundred other things. The negatives are concentrated to the locality and everyone else reaps the benefits. I get it if you wish to put a 99% self-sufficiency condition (water/power etc) but everything else reeks of luddism and nimbyism.
- suddenlybananas 5mo ago
  >train stations, railway lines, airports, garbage dumps, sewage treatment plants, military bases All of these create a ton of jobs in the local area and many of them provide massive advantages to the local area (except railway lines if you're not near a station I guess).
- notarobot123 5mo ago
  The point is that most utilities like transport infrastructure and sewage treatment benefit local residents and the broader society directly. Datacenters are not utilities in the same way and have a much narrower social impact.
  - gruez 5mo ago
    >Datacenters are not utilities in the same way and have a much narrower social impact. chatgpt has 900M weekly active users, so a significant fraction of the world population. Given that the user base probably skews towards rich countries, its proportion among the local population is probably even higher. On the other hand what do you think is the proportion of people who take trains, especially in the US? What about steel plants?
    - manuelmoreale 5mo ago
      A significant % of the population in rich countries, probably close to > 100%, benefits from transport infrastructure and sewage treatment and many other vital services. I don't see why 900M of free users on chatgpt is a relevant argument.
Rekindle8090 5mo ago
[dead]

by amluto 5mo ago

morpheuskafka 5mo ago

A warehouse or factory would have more jobs, but would also bring massive truck loads to the local roads and corresponding pollution. The low staffing of datacenters means that one they are built there is little transportation impact.

thefz 5mo ago
And there is almost zero value generated locally.
- tartoran 5mo ago
  The tax will address that.
znpy 5mo ago
> A warehouse or factory would have more jobs, It would add low value-added jobs though (unskilled labor). Datacenters add high value-added jobs (skilled labor). Only looking at the headcount is shortsighted imho.
- oblio 5mo ago
  Aren't DC remotely managed for almost everything? How does a DC in Paris, Alabama benefit the locals if 99% of the well paid jobs for it are done in the Bay Area?
  - condis 5mo ago
    [dead]
    - Rekindle8090 5mo ago
      [dead]
- eqvinox 5mo ago
  > Datacenters add high value-added jobs (skilled labor). The highest skill job an AI datacenter adds locally is electrician or climate technician. And not many of those.

vessenes 5mo ago

Why don't they pay much in taxes? hyperscalers are pretty profitable.

zdragnar 5mo ago
The hyperscalers aren't making sales directly from the data center, so there's not much to tax other than the land value, the electricity they use, and the few employee salaries. You'd need some sort of data ingress/egress tax.
- oersted 5mo ago
  The idea of having what equates to trade tariffs for data transfers sounds horrifying. But to be fair, we are kinda suffering similar charges already from all major cloud providers, and we seem to be okay with it... Still horrifying, but not entirely unprecedented I suppose.
- vessenes 5mo ago
  Interesting. Just checked some numbers. So Coreweave has like $3bn in operating cashflow last quarter. Your point is that after we are done with all the capex/interest rate deductions/etc and look at a steady state business for a given CoreWeave datacenter, that net income won't be marked locally to a given datacenter. Is that true though? If a Delaware corp is operating in most states, I believe they must file as a foreign corporation in that state; I'm surprised GAAP would not require them accruing some of this income to the locations that provided the work to do the income.
palmotea 5mo ago
> Why don't they pay much in taxes? hyperscalers are pretty profitable. I wouldn't be surprised if those profits are re-imagined as costs paid to some entity in a tax-haven. Also there's different kinds of taxes. IIRC, local communities get their revenue from sales taxes and property taxes. A data center doesn't sell anything, so they probably get zero from that. I don't really know how they'd factor into property taxes, because they're a blight and I don't know how the locality would assess their value without comparable transactions.

oersted 5mo ago

I'm confused, do they really have such an impact? They are of course big and expensive, but surely most datacenters are relatively innocuous in terms pollution and general disruption to the area compared to any regular heavy-industry site, right? Please let me know if I'm wrong, I'm not sure. EDIT: I do get it, it is mainly about local benefit not really about pollution or disruption, even if they are loud about that because it sounds better. Local municipalities should definitely charge significant land rents or zoning fees so that the community benefits. China has been very successful at this for decades. EDIT: Very rough overview after some research, using Colossus 1 as reference, which is among the biggest GPU deployments. Not thoroughly verified, but it'll be around the right ballpark. - Electricity: 150 MW live, with another 150 MW planned/studied. That is like adding a medium electric-arc steel mill or large chemical plant to the grid. A small standard power-plant can generate about that much. - Land / space: About 217 acres and 785,000 sq ft. Footprint-wise, that is like a large factory campus or logistics park; much smaller than a mine, port, refinery, or industrial farm, but far beyond a normal commercial warehouse. - Water: Roughly 1.3–3M gallons/day in public estimates. That is comparable to the consumptive water use of a small-to-mid steel plant or a large industrial cooling site; not refinery-scale, but locally significant. - Air pollution: The servers are not the dirty part; the issue is on-site gas turbines/generators. That makes it more like a small gas peaker plant than a steel mill or chemical plant. Colossus 1 reportedly used up to 35 gas turbines before grid connection. - Noise: Mainly cooling equipment, substations, batteries, turbines/generators. More like living near a substation or small power plant than near a mine, port, or metalworks. - Traffic / logistics: Heavy during construction, then relatively light. Much less disruptive than a port, mine, farm, steel plant, or refinery, because there is no constant flow of ore, scrap, fuel, chemicals, crops, containers, or waste. - Heat: Nearly all consumed electricity becomes heat. At 150–300 MW, the heat rejection is industrial-scale, closer to a small power station / large process plant than normal manufacturing.

toyg 5mo ago
Heavy-industry sites are also extremely discouraged across Europe, outside of very specific zones. If anything, the current shift is about bringing datacentres in that same category.

jmyeet 5mo ago

It's worse than that. Data centers aren't a net zero for the area, they're a net negative. They use up water, arguably pollute said water [1], they jack up the price of everybody's electricity (because everyone else ends up paying for the extra infrastructure), can cause pollution directly (eg xAI runs highly-polluting gas turbines in a city through a legal loophole of them being "mobile" [2]) and aren't the quiet, unseen facilities proponents make them out to be (eg [3]). On top of all that they typically get massive subsidies and tax credits. Why? Because the DC might go somewhere else, allegedly. Where? Nobody wants it. Everybody knows the politicians approving all this are getting bought or just coerced. I'd love to see a single example of where one of these data centers was welcomed by the community or somehow a net positive. [1]: https://www.bbc.com/news/articles/cy8gy7lv448o https://www.bbc.com/news/articles/cy8gy7lv448o [2]: https://earthjustice.org/case/xai-illegal-gas-power-plant-data-center-colossus https://earthjustice.org/case/xai-illegal-gas-power-plant-da... [3]: https://www.nbcwashington.com/news/local/northern-virginia/neighbors-raise-concerns-about-noisy-data-center-in-loudoun/4080249/ https://www.nbcwashington.com/news/local/northern-virginia/n...

znpy 5mo ago

> they destroy green space the law addresses exactly this. it greatly overtaxes datacenter in green spaces and lowers taxes in former industrial areas. Regarding whether it's a good development drive... I can tell you, most companies could save a shitload of money by buying a few pallets of machines and racking them in a... datacenter. I see our monthly AWS bill, I highly doubt we'd be spending that in datacenter bills.

sieve 5mo ago

> Datacenters are weird In the same way that most public utilities are: train stations, railway lines, airports, garbage dumps, sewage treatment plants, military bases and a hundred other things. The negatives are concentrated to the locality and everyone else reaps the benefits. I get it if you wish to put a 99% self-sufficiency condition (water/power etc) but everything else reeks of luddism and nimbyism.

suddenlybananas 5mo ago
>train stations, railway lines, airports, garbage dumps, sewage treatment plants, military bases All of these create a ton of jobs in the local area and many of them provide massive advantages to the local area (except railway lines if you're not near a station I guess).
notarobot123 5mo ago
The point is that most utilities like transport infrastructure and sewage treatment benefit local residents and the broader society directly. Datacenters are not utilities in the same way and have a much narrower social impact.
- gruez 5mo ago
  >Datacenters are not utilities in the same way and have a much narrower social impact. chatgpt has 900M weekly active users, so a significant fraction of the world population. Given that the user base probably skews towards rich countries, its proportion among the local population is probably even higher. On the other hand what do you think is the proportion of people who take trains, especially in the US? What about steel plants?
  - manuelmoreale 5mo ago
    A significant % of the population in rich countries, probably close to > 100%, benefits from transport infrastructure and sewage treatment and many other vital services. I don't see why 900M of free users on chatgpt is a relevant argument.

Rekindle8090 5mo ago

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