FT series finds China building AI data centers to soak up surplus power in its hinterland
This is the first in a three-part series examining China’s breakneck build-out of AI infrastructure as it seeks to become the pre-eminent tech superpower. With @EleanorOlcott and @WillLangley96 from the hinterlands of Ulanqab to Shaoguan Limited free link
Context
Power is one of the main limits on AI compute, and the FT reports China is turning a regional electricity surplus into data center capacity.
The Financial Times began a three part series on October 8 on China's AI infrastructure build out, reported by Zijing Wu, Eleanor Olcott and Will Langley. The first part covers Ulanqab in Inner Mongolia, where 89 data centers are built or planned, and Shaoguan in Guangdong. Olcott wrote on X that Inner Mongolia may hold the world's largest local electricity oversupply, which the data center boom is now absorbing.
Deep dive
The FT reports that China is building data centers at rapid speed across its energy rich hinterland, as Beijing seeks to turn abundant electricity and cheap land into an advantage in the global race to develop AI. The paper describes the buildout as among the fastest and biggest anywhere in the world.
A version of the story syndicated by the Australian Financial Review describes data centers in the region being built at warp speed, with abundant electricity, thousands of workers and no opposition. Ulanqab alone has 89 data centers built or planned, according to the FT.
Zijing Wu, one of the reporters, introduced the series on X as an examination of China's push to become the leading tech superpower, reported from Ulanqab to Shaoguan. The story went viral after the account Jukan quoted it, calling China's situation insane and highlighting the line that data centers are the solution to electricity oversupply.
Caixin reported in August on how Ulanqab became an AI hub. The region sits within China's East Data, West Compute policy, which steers computing demand from eastern cities toward western regions with cheaper energy and land. Figures circulating on X about committed capacity and electricity prices in Ulanqab have not been confirmed by the FT excerpts reviewed here.
What to expect next
Two more parts of the FT series are due, so expect more detail on where the chips, capital and customers for these facilities come from.
Open questions include how fully the new data centers are being used, how China supplies them with advanced chips under US export controls, and whether surplus power in Inner Mongolia keeps pace with demand. Watch also for US policy responses as power becomes a bigger factor in the AI race.