Meta to Construct $10 Billion AI Data Center in Louisiana Amid Musk's Expansion

The tech company Meta, known as the parent company of Facebook, has announced plans to build its largest artificial intelligence (AI) data center in northeast Louisiana. This new facility, which will cost around $10 billion, aims to revive an economically challenged area of the state.

Louisiana’s Republican Governor Jeff Landry expressed optimism, calling the project a significant advancement for the tech industry in the state. However, environmental groups are concerned about the center's reliance on fossil fuels and the prospect of increased energy costs for local residents due to new natural gas resources required to support the operation.

In a related development, Elon Musk's AI startup, xAI, is extending its supercomputer initiative in Memphis, Tennessee. Local officials in Memphis confirmed that major tech companies like Nvidia, Dell, and Supermicro Computer will also establish their operations in the city, although no specific details have been provided.

To attract large tech companies looking to set up energy-intensive data centers, Louisiana is joining a trend among various states by providing tax breaks and incentives. According to the U.S. Commerce Department, the current number of data centers in the U.S. is insufficient to cater to the growing demand driven by AI, which is expected to rise by 9% annually until 2030, according to industry insights.

Meta estimates that its new data center in Louisiana will generate approximately 500 permanent jobs and 5,000 temporary construction positions, as noted by Kevin Janda, the director of data center strategy. The center, anticipated to cover 4 million square feet, will be Meta's largest AI facility to date.

“We want to ensure we contribute positively to the local community,” Janda stated.

Politicians from both sides of the aisle view the Meta facility as beneficial for Richland Parish, which historically has a population of about 20,000 and has been heavily reliant on agriculture. The U.S. Census data indicates that approximately 25% of the population lives in poverty, with an employment rate of under 50%.

Meta is also planning to invest $200 million in upgrades to local road and water infrastructure to mitigate the effects of the facility’s water consumption. The facility is projected to be operational by 2030.

To support Meta’s data center, Entergy, one of the largest utility companies in the U.S., is expediting plans to construct three natural gas power plants in Louisiana. These plants will be capable of producing 2,262 megawatts over a period of 15 years—accounting for nearly 10% of Entergy’s current energy output across four states.

As Entergy’s proposal awaits review by the Louisiana Public Service Commission, some environmental advocates express concern about the potential for long-term dependence on fossil fuel infrastructure. In response, Meta announced plans to integrate 1,500 megawatts of renewable energy into the grid in the future.

Community advocate Jessica Hendricks, who serves as the state policy director for the Alliance for Affordable Energy, warned that residents could face rate increases to finance the operation of the new natural gas power plants after Meta's contract with Entergy ends. "There’s no reason for residential customers in Louisiana to foot the bill for a power plant that they will not utilize," she stressed. "It is essential to ensure safety precautions are in place."

Nevertheless, Public Service Commissioner Foster Campbell, who represents northeast Louisiana, is confident that the data center will not result in higher rates for local residents and believes it serves a crucial need for the region. "This facility is being placed in one of the most required locations in Louisiana and the entire U.S.," he commented. "I fully support it."

Meanwhile, environmental groups have raised similar alarms concerning the pollution associated with Musk's AI facility in Memphis. The Southern Environmental Law Center claims that the supercomputer operation could strain the existing power grid, which has drawn the attention of the Environmental Protection Agency. They point out that the 18 gas turbines currently in operation at xAI’s facility produce significant levels of ground-level ozone, contributing to smog.

Patrick Anderson, a lawyer with the law center, emphasized the need for transparency regarding xAI’s operational impact on the local community. He stated, "Residents deserve clarity on how xAI will affect them and should be part of the decision-making process."

Meta, AI, Energy, Louisiana, Musk