The AI period is giving fracking a second act, a stunning twist for an trade that, even throughout its early 2010s growth years, was blamed by local weather advocates for poisoned water tables, man-made earthquakes, and the cussed persistence of fossil fuels.
AI firms are constructing large knowledge facilities close to main gas-production websites, usually producing their very own energy by tapping instantly into fossil fuels. It’s a pattern that’s been overshadowed by headlines in regards to the intersection of AI and healthcare (and fixing local weather change), but it surely’s one that would reshape — and lift tough questions for — the communities that host these services.
Take the most recent instance. This week, the Wall Avenue Journal reported that AI coding assistant startup Poolside is developing a knowledge middle complicated on greater than 500 acres in West Texas — about 300 miles west of Dallas — a footprint two-thirds the scale of Central Park. The ability 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 widespread 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 total 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 middle in Abilene, Texas — round 200 miles from the Permian Basin — the place he was candid, saying, “We’re burning gasoline to run this knowledge middle.”
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 accordance with the Related Press. The businesses say the plant gives solely backup energy, with most electrical energy coming from the native grid. That grid, for the file, attracts from a mixture of pure gasoline and the sprawling wind and photo voltaic farms in West Texas.
However the individuals dwelling close to these tasks aren’t precisely comforted. Arlene Mendler lives throughout the road from Stargate. She instructed 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.
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“It has utterly modified the best way we have been dwelling,” Mendler instructed the AP. She moved to the realm 33 years in the past looking for “peace, quiet, tranquility.” Now development 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. The town’s reservoirs have been at roughly half capability throughout Altman’s go to, with residents on a twice-weekly outside 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 programs. However Shaolei Ren, a College of California, Riverside, professor who research AI’s environmental footprint, instructed the AP that’s deceptive. These programs require extra electrical energy, which suggests extra oblique water consumption on the energy crops producing that electrical energy.
Meta is pursuing an identical technique. In Richland Parish, the poorest area of Louisiana, the corporate plans to construct a $10 billion knowledge middle the scale 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 way 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 be constructing in Texas, although elsewhere within the state. This week the corporate introduced a $1.5 billion knowledge middle 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 might 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, Fuel and Water — which at the moment 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 by way of two firms: Texas Fuel Transmission Corp. and Trunkline Fuel Firm.
Texas Fuel Transmission is a bidirectional pipeline carrying pure gasoline from Gulf Coast provide areas and several other main hydraulically fractured shale formations by way of Arkansas, Mississippi, Kentucky, and Tennessee. Trunkline Fuel Firm, the opposite Memphis provider, additionally carries pure gasoline from fracked sources.
When you’re questioning why AI firms are pursuing this path, they’ll inform you 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 vp of world affairs in 2024, laid out the case throughout an onstage interview with Trendster.
“We imagine that within the not-too-distant future, no less than within the U.S., and actually all over the world, we’re going to have to be producing within the neighborhood of a gigawatt of vitality every week,” Lehane stated. He pointed to China’s large vitality buildout: 450 gigawatts and 33 nuclear services constructed within the final 12 months alone.
When Trendster requested about Stargate’s choice 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 could have a possibility to re-industrialize nations, deliver manufacturing again and likewise transition our vitality programs in order that we do the modernization that should happen.”
The Trump administration is actually on board. The July 2025 government order fast-tracks gas-powered AI knowledge facilities by streamlining environmental permits, providing monetary incentives, and opening federal lands for tasks utilizing pure gasoline, coal, or nuclear energy — whereas explicitly excluding renewables from assist.
For now, most AI customers stay largely unaware of the carbon footprint behind their dazzling new toys and work instruments. They’re extra centered 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 this can be a bubble, it gained’t be fairly. The AI sector has turn into a round firing squad of dependencies: OpenAI wants Microsoft wants Nvidia wants Broadcom wants Oracle wants knowledge middle 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 loads of costly infrastructure left standing round, each the digital and the gas-burning sort.
OpenAI’s capability alone to satisfy 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 vital. A Duke College research discovered that utilities usually use solely 53% of their accessible capability all year long. That means vital room to accommodate new demand with out developing new energy crops, as MIT Know-how Assessment reported earlier this 12 months.
The Duke researchers estimate that if knowledge facilities decreased electrical energy consumption by roughly half for only a few hours throughout annual peak demand durations, utilities may deal with a further 76 gigawatts of recent load. That might successfully take in the 65 gigawatts knowledge facilities are projected to wish by 2029.
That form of flexibility would enable firms to launch AI knowledge facilities sooner. Extra importantly, it may present a reprieve from the frenzy to construct pure gasoline infrastructure, giving utilities time to develop cleaner alternate options.
However once more, that will imply dropping 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 go away residents with hovering electrical energy payments to finance in the present day’s investments, together with lengthy after the tech firms’ contracts expire.
Meta, as an illustration, has assured it should cowl Entergy’s prices for the brand new Louisiana technology 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 could finally change. A number of personal cash is being funneled into small modular reactors and photo voltaic installations with the expectation that these cleaner vitality alternate options will turn into extra central vitality sources for these knowledge facilities. Fusion startups like Helion and Commonwealth Fusion Methods 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 thrill has spilled over into public markets, the place a number of “non-revenue-generating” vitality firms which have managed to go public have really anticipatory market caps, primarily based on the expectation that they’ll at some point gasoline these knowledge facilities.
Within the meantime — which may nonetheless be a long time — essentially 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.
