While the U.S. Fights Over Where to Put AI Data Centers, China Just Built One on the Ocean Floor — But How Safe Is It?

Listen to this post

Is the solution to the AI data center land problem putting them in the ocean? This week, China officially activated the world’s first commercial underwater data center, a $226 million facility sitting 115 feet below the surface of the East China Sea, about six miles off the coast of Shanghai, according to Gizmodo.

Built by HiCloud Technology in partnership with the Chinese government, the facility houses 2,000 servers cooled entirely by surrounding seawater and powered by an offshore wind farm. Land-based data centers have been criticized for using up to 40% of their energy just on cooling. This one uses almost none.

Microsoft tried a similar experiment — Project Natick — but shelved it in 2024, citing economics and the difficulty of servicing submerged equipment. China turned the same concept into a working commercial facility and is already planning a 500-megawatt expansion.

But not everyone is convinced it’s a green solution. Scientists have warned that heat generated by underwater facilities could trigger toxic algae blooms and create de-oxygenated conditions that suffocate marine life. A UN report published this week found data center water consumption could hit 9.3 trillion liters by 2030. The ocean may solve the water-usage problem, but whether it creates a new one remains to be seen.