00:00 Speaker A

New York hits pause, Dan, on AI data centers. Governor Hochul said to sign an EO, executive order, to ban construction on large data centers for up to a year. What are you making of it? And what’s the worry here? Is it power consumption, uh water consumption, electricity bills? What do you think?

00:23 Dan

I think it’s all of the above. And it’s interesting, you know, with the the electricity bills, uh it’s, you know, it’s easy to blame data centers. Um, you know, but for electricity in particular, it’s it’s kind of a a confluence of events, right? It’s yes there’s these high-powered AI data centers that are coming online and eat power, right? gigawatts of power.

00:43 Dan

But also the grid is just outdated. Uh there need to be upgrades done. Uh and so, you know, uh there’s been wild weather that’s been an issue for a lot of the country. And so it’s it’s multiple reasons why uh the the power side of things uh is has been such a hot topic of conversation with regards to data centers. But data centers aren’t the uh only issue going on there. Uh water obviously is a a big discussion on, you know, okay,

01:07 Dan

so these uh facilities need to cool their chips and they use what’s called liquid cooling. Um well they they may, you know, pump water through uh different pipes.

01:21 Dan

It kind of acts as a a just like a car radiator, right? There’s just liquid running through.

01:23 Speaker A

But I I’ve heard push back on that, Dan. And folks say, that’s sort of like it’s kind of like a pool. Like you fill it once and then you’re done, right? Is that true? Is that accurate?

01:31 Dan

Yeah, I mean there there there are, uh yes, there there are closed loop systems and that’s going to be more and more uh of a kind of uh way that these are constructed where they they’ll use uh basically water just for everyday needs, for, you know, the sink, right? And it’s not going to be used for actually cooling off uh the data center uh uh uh uh chips, right? That’s that’s the the idea going forward. And there’s, you know, it’s not exactly just water that’s running through these. There’re, you know, there’s different uh types of uh uh uh, what is it, heat dissipating fluids that that are used.

02:04 Dan

Um I remember I was talking to a guy at Nvidia once and I was like, so what’s in there? And he was like, yeah, it’s basically antifreeze. And I was like, oh, well, okay, cool. And yeah, he was joking, but um I I I think though, when you look at these kind of this pushback, and you’ve seen it across the country, right? It’s it’s sure in New York, but there’s been push back in Texas as well.

02:24 Speaker A

I see lawn signs, stop the data center in the suburbs of New Jersey.

02:27 Dan

In Jersey. Yeah, in Jersey it’s it’s a big thing as well. Uh you know, Jersey’s a hub. Uh obviously there’s plenty of Amazon warehouses. Uh I think that coupled with uh the AI data centers being built probably has a lot of people pushing back. There’s uh noise issues uh that people say uh when they live nearby that it’s a constant low-level hum that they hear all the time. So I I do think that we’re going to continue to see this kind of push back uh from from residents. Uh you know, if I bought a house and someone started standing up a giant data center right next door, yeah, I’d be pretty annoyed.

03:02 Speaker A

Uh meanwhile though, meanwhile, China, Right. and so continues to build aggressively. Now, does this make it, you know, in theory easier then for Beijing to close the AI gap with the US?

03:17 Dan

Yes and no. Uh yes, in that they would be able to build out data centers without, you know, I mean, you’re going to complain, but what’s going to happen?

03:26 Speaker A

Yeah, I don’t suggest complaining in in China. That usually doesn’t go well.

03:29 Dan

No, I don’t I don’t think uh uh Xi Jinping is going to say, all right guys, you get it.

03:34 Speaker A

Xi doesn’t operate by polling. Yeah. That’s not how it works over there. No.

03:37 Dan

Yeah, yeah. Um yeah, I I think that the the concern is falling behind and that not having data centers would mean that, okay, so now uh you’re just cutting off your nose to spite your face. That’s the argument against any kind of of of limits. Uh the other thing is that China doesn’t necessarily have the chips that the US has right now. So there’s kind of that divide. Okay, does that though uh get outweighed by China being able to build more and more data centers over larger and larger areas.

04:09 Dan

You know, if you have uh a single data center with high-powered Nvidia chips, but then you have five data centers with slightly less powerful chips, what does that then mean as far as training and capabilities? It’s something that people are just going to have to weigh, you know, one way or the other. If if there’s a if there were a way, I mean that’s why this whole idea of space-based data centers is so interesting. Uh whether it happens or not, I don’t know.

04:32 Dan

Uh but the idea would be that, okay, you don’t have to take up space on uh the ground. You just chuck this thing up into, you know, the atmosphere and it just kind of, you know, rotates around forever. But is that feasible? Is that something that’s going to happen on the long term or is that something that’s going to happen tomorrow when, you know, someone starts seeing that they’re breaking ground on a data center next to their kid’s school or something. You know, I it’s it’s going to be this ongoing debate. Uh there are data centers, by the way, all over the country.

04:54 Dan

You know, it’s not as though this this is something brand new. I think that the the idea of AI, uh look, if you come out uh with a new product and uh the folks who lead the company say, you know what, it might take your job. And by the way, it’s going to be right next to your house. And by the way, your power bill might go up. It doesn’t exactly get the best PR, right?

05:15 Speaker A

No, AI AI as we’ve discussed, has a PR problem.

05:18 Dan

Yeah. Whether it’s right or wrong, I you know, that’s not for me to say. I’m just here.

05:22 Speaker A

You’re just here to report.