Large data centre projects intended to support AI and cloud workloads are facing power shortages and grid delays. Some are also facing planning disputes, land-use concerns, and rising construction costs.
A report by The Guardian, citing data from the Uptime Institute, said 250 data centre projects requiring more than 100MW of power each were announced globally between 2021 and 2024. Uptime estimates that about half of those projects will either be delayed or not proceed.
Data centre projects need land, grid connections, and substations before they can support cloud and AI workloads. They also require cooling systems, construction capacity, and local approvals.
Projects face delay risks
The Prince William Digital Gateway project in Virginia is among the projects now facing uncertainty. The planned 2,000-acre site has been challenged partly because of its proximity to a Civil War battlefield.
Opponents argued in a legal brief that the project would affect the character of the historic site because of the scale of the data centres and related electrical infrastructure. A local court ruling has since halted the project, and a key backer has withdrawn.
Uptime has listed the Prince William Gateway among cancelled projects. Other large projects cancelled last year include Project Range in Arizona and the Cyberjaya campus in Malaysia.
Uptime said 100MW is roughly equivalent to the power demand of about 300,000 homes.
Announced projects still need power agreements, grid connections, and permits before they can enter service. They also require equipment, contractors, tenants, and financing.
Uptime said newer projects are also increasing in scale. It said the industry is moving toward mega-gigawatt campuses, with six projects announced last year that each sought at least 5GW of power. Five were in the US, and one was in the United Arab Emirates.
Ireland’s peak power demand is around 6GW. Uptime said the seven largest planned data centres globally are proposing a combined 45GW of onsite power, with gas as the main source. The UK’s peak energy demand is around 45GW.
Power and grid access
The International Energy Agency expects global electricity consumption from data centres to more than double to about 945 TWh by 2030, equal to just under 3% of total global electricity use that year.
Uptime said data centre power demand, particularly in North America, cannot be supported by grids that are already under strain.
The institute estimated that projects announced last year alone would consume 1.3% of projected global electricity use in 2025 if they operated at 25% of planned capacity. It said this would nearly double current data centre demand. About 80% of the new power demand is linked to US projects.
The US Energy Information Administration expects electricity consumption to reach record levels in 2026 and 2027. Reuters reported that AI data centres, cryptocurrency facilities, and electrification are among the drivers.
Reuters also reported that capacity charges in the PJM Interconnection region rose more than 1,000% between 2024 and 2026, with manufacturers arguing that data centre demand is contributing to higher costs.
Google has said its cloud business is “compute-constrained,” as companies and users require more capacity for AI services delivered through data centres.
Jay Dietrich, a research director at Uptime, said several factors are slowing projects. These include proposals from developers without data centre experience and projects without committed tenants. He also cited energy and water requirements, concentration in existing data centre corridors, and supply chain constraints.
He said the global supply chain cannot support the number of proposed projects within the timelines being presented. Chips and electrical equipment affect delivery schedules. Cooling systems, skilled construction labour, and grid infrastructure also shape project timelines.
Uptime also identified tenant risk as a factor, including proposed projects from developers without committed customers.
Facilities wait for power
In California, some completed data centres are still waiting for power. In Santa Clara, two Silicon Valley data centres with a combined planned load of nearly 100MW could reportedly sit idle for years.
The city’s municipal utility is managing 57 data centres in operation or development. Grid upgrades costing about $450 million are not expected to be completed until 2028.
In Amsterdam, an Australian data centre developer sued the Dutch grid operator after its request for a connection was rejected.
Projects can also face community and environmental opposition. In Virginia, opponents cited the site’s proximity to a Civil War battlefield and the scale of the related electrical infrastructure.
Planning disputes can involve land use, transmission lines, backup generation, and the visual impact of large facilities and related power infrastructure.
Onsite power
Data centres require power for servers, networking equipment, storage systems, and cooling. Larger AI facilities can also require dedicated substations, transmission upgrades, and backup generation.
Uptime said gas is the main energy source proposed for the world’s seven largest planned data centres.
Onsite power projects still require fuel supply, generation equipment, emissions approvals, and grid coordination. The US Department of Energy has said rising data centre electricity demand will require a mix of generation, storage, grid expansion, energy efficiency, and demand-side resources.
Battery storage and onsite generation are also being considered by parts of the industry. These systems can support backup power and demand management, but still require grid coordination and permits.
Property consultancy JLL expects about 1,200 data centres to be built globally by 2030, with AI listed as the main source of demand.
Andrew Batson, JLL’s global head of data centre research, said lease signings and groundbreakings in the first half of 2026 were slightly ahead of his estimates. He said the industry has been developing ways to address energy constraints, including battery storage and onsite power generation.
(Photo by Taylor Vick)
See also: South Korea AI data centre push includes SK Telecom’s 15GW plan
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