Google buys nuclear power and spends $15B in AI infrastructure
Alphabet’s Google plans to allocate a minimum of €13 billion in AI infrastructure in Finland over the next two years, marking its largest investment in Europe. This initiative includes a significant agreement for the provision of nuclear power. The U.S. firm announced on Wednesday that the expansion of its AI infrastructure will include the establishment of three new data centers in the northern region of the country, where winter temperatures can fall significantly below minus 10 degrees Celsius (14 degrees Fahrenheit). The deal signifies a significant advancement for Google in Europe, where the cooler temperatures and reliable energy grids in the Nordics present an appealing environment for data centers that are both energy- and water-intensive, necessitating substantial energy consumption to maintain optimal cooling for their computer servers. Freezing air presents a potentially efficient alternative.
Alphabet this year has raised its global investment to a range of $195 billion to $205 billion in an effort to capitalise on the increasing demand for AI computing. The Finland deal encompasses a 22-year purchase agreement for as much as 50% of the energy output from one of the nation’s two nuclear plants, as stated by its operator Fortum. This arrangement is expected to bolster electricity supply. “We call this BYOP, bring your own power,” Google’s President and Chief Investment Officer Ruth Porat told. “This is Google’s first nuclear energy deal outside of the United States.” Nuclear power, recognised for its capacity to generate substantial quantities of low-carbon energy, represents a significant advantage that Finland presents to corporations such as Microsoft, ByteDance, and Google. These companies are actively searching for locations to establish data centers, all while striving to manage energy expenses and fulfilll climate objectives.
Fortum and Google will also explore the development of new nuclear and renewable energy in Finland, the companies stated. Fortum’s shares surged 15.5% to reach 4-1/2-year highs following the announcement, marking it as the largest gainer in Europe. The investments will encompass data centers, enhancements to the electricity grid, and initiatives in clean energy and battery projects that support services including Gemini, Search, Maps, and YouTube, as stated by Google. The investment, scheduled for 2027 and 2028, is expected to add approximately €3.6 billion to Finland’s gross domestic product during the construction phase and is anticipated to sustain around 7,000 jobs each year once it becomes operational, according to Google. Finland’s Prime Minister Petteri Orpo stated that the agreement would enhance the economy by stimulating innovation, research, and development, while minimising worries that it would consume energy and increase prices.
“Based on all the information available, there is enough electricity,” he said. “They are committed to ensuring that electricity production in Finland remains sufficient and that prices remain under control.” Finland, comparable in size to Germany yet home to fewer than 6 million residents, has exhibited less pronounced resistance to the expansion of data centers than various other regions, including the United States. In its statement, utility Fortum indicated that the long-term purchase agreement offered economic certainty for both the lifetime extension and the upgrade of the Loviisa power plant through 2050. The facility is located in proximity to Google’s Hamina data center.
