Karen Hao, a journalist and author of the bestselling book Empire of AI, gave a talk Saturday at St. John’s United Methodist Church in Santa Fe.
Hao’s visit comes amid a possible acquisition of PNM, the state’s electric utility, by the private equity firm Blackstone. Blackstone is already investing in AI data centers, and some locals fear that a Blackstone takeover of the electrical grid could lead to more data centers being built in New Mexico.
Hao acknowledged that the idea of a new AI data center can be appealing to low-income communities who are eager for economic opportunity. “Companies love to say that it’s gonna generate jobs, that it’s gonna generate tax revenues," she explained. "And for a lot of smaller towns, especially former industrial bases that are really suffering economically, this seems like a really great premise.”
But, she argued, those perceived benefits are not sustainable. “The jobs are not permanent. They’re talking about construction jobs, and those construction jobs aren’t even coming from the local community. They actually ship in workers from other data center projects to help support this data center project because you can’t just immediate upscale a population to build a data center locally, especially based on the timelines that these companies want everything constructed.”
Another concern surrounding these data centers is that local communities will be forced to pay construction costs. Bianca Sopoci-Belknap, a community organizer and associate director of New Energy Economy, explained the possible risk to ratepayers of a Blackstone takeover.
“Blackstone is very interested in building out AI data centers and being able to make sure that the cost of that is borne by ratepayers, who are stuck in a monopoly utility structure," she said. "We have to pay for the infrastructure that they build, and if they build AI data centers, that is something that they can charge to ratepayers. There’s a lot of profit to be made in AI development, and the best way to do that is by having ratepayers who can’t choose any other option than to pay their utility bills.”
Hao and Sopoci-Belknap expressed concern not only about the economic impact of data centers, but also their toll on the environment. AI data centers regularly require fresh water as a coolant for their operating systems.
I asked Hao why anyone would build a data center in the arid New Mexican climate.
“When companies choose where to place their data centers, they are looking at a variety of different factors: cheap land, cheap electricity, limited natural disasters," she said. "And it turns out that deserts often check off those boxes, especially in the U.S. Southwest.”
She added that New Mexico isn’t the only example of an AI data center being built in a place where water is even more scarce than it was in previous decades. “Every place that I’ve traveled, where I’ve looked at data centers, it’s not always that they were de facto deserts, but almost all of them are suffering from some degree of historic drought now.”
Sopoci-Belknap agreed. “They’re looking at places where the land is cheap and where there’s not a lot of political power to resist the buildout. They see us in New Mexico as an opportunity to basically exploit.”
Hao, who also spoke in Albuquerque that day, is continuing on a nationwide speaking tour. Sopoci-Belknap told me that she and her organization will continue to fight against a Blackstone takeover of PNM.
