Your AI instruments run on fracked gasoline and bulldozed Texas land

The AI period is giving fracking a second act, a stunning twist for an trade that, even throughout its early 2010s increase years, was blamed by local weather advocates for poisoned water tables, man-made earthquakes, and the cussed persistence of fossil fuels.

AI corporations are constructing huge knowledge facilities close to main gas-production websites, typically producing their very own energy by tapping straight into fossil fuels. It’s a development that’s been overshadowed by headlines concerning the intersection of AI and healthcare (and fixing local weather change), but it surely’s one that might reshape — and lift tough questions for — the communities that host these services.

Take the newest instance. This week, the Wall Avenue Journal reported that AI coding assistant startup Poolside is setting up a knowledge heart complicated on greater than 500 acres in West Texas — about 300 miles west of Dallas — a footprint two-thirds the dimensions of Central Park. The power will generate its personal energy by tapping pure gasoline from the Permian Basin, the nation’s most efficient oil and gasoline area, the place hydraulic fracturing isn’t simply frequent however actually the one recreation on the town.

The venture, dubbed Horizon, will produce two gigawatts of computing energy. That’s equal to the Hoover Dam’s whole electrical capability, besides as a substitute of harnessing the Colorado River, it’s burning fracked gasoline. Poolside is creating the ability with CoreWeave, a cloud computing firm that rents out entry to Nvidia AI chips and that’s supplying entry to greater than 40,000 of them. The Journal calls it an “vitality Wild West,” which appears apt.

But Poolside is much from alone. Practically all the main AI gamers are pursuing related methods. Final month, OpenAI CEO Sam Altman toured his firm’s flagship Stargate knowledge heart in Abilene, Texas — round 200 miles from the Permian Basin — the place he was candid, saying, “We’re burning gasoline to run this knowledge heart.”

The complicated requires about 900 megawatts of electrical energy throughout eight buildings and features a new gas-fired energy plant utilizing generators related to people who energy warships, in keeping with the Related Press. The businesses say the plant offers solely backup energy, with most electrical energy coming from the native grid. That grid, for the document, attracts from a mixture of pure gasoline and the sprawling wind and photo voltaic farms in West Texas.

However the folks residing close to these initiatives aren’t precisely comforted. Arlene Mendler lives throughout the road from Stargate. She informed the AP she needs somebody had requested her opinion earlier than bulldozers eradicated an enormous tract of mesquite shrubland to make room for what’s being constructed atop it.

“It has utterly modified the way in which we had been residing,” Mendler informed the AP. She moved to the realm 33 years in the past in search of “peace, quiet, tranquility.” Now building is the soundtrack within the background, and brilliant lights on the scene have spoiled her nighttime views.

Then there’s the water. In drought-prone West Texas, locals are notably nervous about how new knowledge facilities will impression the water provide. Town’s reservoirs had been at roughly half capability throughout Altman’s go to, with residents on a twice-weekly out of doors watering schedule. Oracle claims every of the eight buildings will want simply 12,000 gallons per 12 months after an preliminary million-gallon fill for closed-loop cooling methods. However Shaolei Ren, a College of California, Riverside, professor who research AI’s environmental footprint, informed the AP that’s deceptive. These methods require extra electrical energy, which implies extra oblique water consumption on the energy crops producing that electrical energy.

Meta is pursuing the same technique. In Richland Parish, the poorest area of Louisiana, the corporate plans to construct a $10 billion knowledge heart the dimensions of 1,700 soccer fields that can require two gigawatts of energy for computation alone. Utility firm Entergy will spend $3.2 billion to construct three giant natural-gas energy crops with 2.3 gigawatts of capability to feed the ability by burning gasoline extracted by means of fracking within the close by Haynesville Shale. Louisiana residents, like these in Abilene, aren’t thrilled to be encircled by bulldozers across the clock.

(Meta can also be constructing in Texas, although elsewhere within the state. This week the corporate introduced a $1.5 billion knowledge heart in El Paso, close to the New Mexico border, with one gigawatt of capability anticipated on-line in 2028. El Paso isn’t close to the Permian Basin, and Meta says the ability will probably be matched with 100% clear and renewable vitality. One level for Meta.)

Even Elon Musk’s xAI, whose Memphis facility has generated appreciable controversy this 12 months, has fracking connections. Memphis Mild, Gasoline and Water — which at present sells energy to xAI however will finally personal the substations xAI is constructing — purchases pure gasoline on the spot market and pipes it to Memphis through two corporations: Texas Gasoline Transmission Corp. and Trunkline Gasoline Firm.

Texas Gasoline Transmission is a bidirectional pipeline carrying pure gasoline from Gulf Coast provide areas and a number of other main hydraulically fractured shale formations by means of Arkansas, Mississippi, Kentucky, and Tennessee. Trunkline Gasoline Firm, the opposite Memphis provider, additionally carries pure gasoline from fracked sources.

In case you’re questioning why AI corporations are pursuing this path, they’ll let you know it’s not nearly electrical energy; it’s additionally about beating China.

That was the argument Chris Lehane made final week. Lehane, a veteran political operative who joined OpenAI as vice chairman of world affairs in 2024, laid out the case throughout an onstage interview with TechCrunch.

“We imagine that within the not-too-distant future, not less than within the U.S., and actually around the globe, we’re going to should be producing within the neighborhood of a gigawatt of vitality per week,” Lehane mentioned. He pointed to China’s huge vitality buildout: 450 gigawatts and 33 nuclear services constructed within the final 12 months alone.

When TechCrunch requested about Stargate’s determination to construct in economically challenged areas like Abilene, or Lordstown, Ohio, the place extra gas-powered crops are deliberate, Lehane returned to geopolitics. “If we [as a country] do that proper, you’ve gotten a possibility to re-industrialize international locations, carry manufacturing again and likewise transition our vitality methods in order that we do the modernization that should happen.”

The Trump administration is definitely on board. The July 2025 govt order fast-tracks gas-powered AI knowledge facilities by streamlining environmental permits, providing monetary incentives, and opening federal lands for initiatives utilizing pure gasoline, coal, or nuclear energy — whereas explicitly excluding renewables from help.

For now, most AI customers stay largely unaware of the carbon footprint behind their dazzling new toys and work instruments. They’re extra targeted on capabilities like Sora 2 — OpenAI’s hyperrealistic video-generation product that requires exponentially extra vitality than a easy chatbot — than on the place the electrical energy comes from.

The businesses are relying on this. They’ve positioned pure gasoline because the pragmatic, inevitable reply to AI’s exploding energy calls for. However the velocity and scale of this fossil gasoline buildout deserves extra consideration than it’s getting.

If it is a bubble, it received’t be fairly. The AI sector has change into a round firing squad of dependencies: OpenAI wants Microsoft wants Nvidia wants Broadcom wants Oracle wants knowledge heart operators who want OpenAI. They’re all shopping for from and promoting to one another in a self-reinforcing loop. The Monetary Instances famous this week if the inspiration cracks, there’ll be a variety of costly infrastructure left standing round, each the digital and the gas-burning variety.

OpenAI’s potential alone to fulfill its obligations is “more and more a priority for the broader economic system,” the outlet wrote.

One key query that’s been largely absent from the dialog is whether or not all this new capability is even essential. A Duke College research discovered that utilities usually use solely 53% of their obtainable capability all year long. That means vital room to accommodate new demand with out setting up new energy crops, as MIT Expertise Overview reported earlier this 12 months.

The Duke researchers estimate that if knowledge facilities lowered electrical energy consumption by roughly half for just some hours throughout annual peak demand intervals, utilities may deal with an extra 76 gigawatts of recent load. That might successfully take in the 65 gigawatts knowledge facilities are projected to want by 2029.

That form of flexibility would permit corporations to launch AI knowledge facilities quicker. Extra importantly, it may present a reprieve from the push to construct pure gasoline infrastructure, giving utilities time to develop cleaner options.

However once more, that may imply shedding floor to an autocratic regime, per Lehane and plenty of others within the trade, so as a substitute, the pure gasoline constructing spree seems prone to saddle areas with extra fossil-fuel crops and depart residents with hovering electrical energy payments to finance at present’s investments, together with lengthy after the tech corporations’ contracts expire.

Meta, for example, has assured it should cowl Entergy’s prices for the brand new Louisiana era for 15 years. Poolside’s lease with CoreWeave runs for 15 years. What occurs to clients when these contracts finish stays an open query.

Issues might finally change. Quite a lot of personal cash is being funneled into small modular reactors and photo voltaic installations with the expectation that these cleaner vitality options will change into extra central vitality sources for these knowledge facilities. Fusion startups like Helion and Commonwealth Fusion Programs have equally raised substantial funding from these on the entrance traces of AI, together with Nvidia and Altman.

This optimism isn’t confined to non-public funding circles. The joy has spilled over into public markets, the place a number of “non-revenue-generating” vitality corporations which have managed to go public have really anticipatory market caps, based mostly on the expectation that they may at some point gasoline these knowledge facilities.

Within the meantime — which may nonetheless be a long time — probably the most urgent concern is that the individuals who’ll be left holding the bag, financially and environmentally, by no means requested for any of this within the first place.