China Just Broke the Mold on AI Data Centers

Facility off coast of Shanghai is world's first wind-powered underwater data center
Posted Jun 10, 2026 10:00 AM CDT
World's First Wind-Powered Underwater Data Center Is Open
Stock photo of wind turbines.   (Getty Images/pedrosala)

China just sank a key piece of its AI future into the sea off Shanghai. The world's first wind-powered underwater data center is now running about 6 miles off the city's coast, in a project backed by HiCloud Technology and state-owned China Communications Construction, reports the Guardian. Submerged roughly 30 feet down and drawing power from a nearby wind farm, the 24-megawatt facility—which Tom's Hardware notes contains close to 2,000 servers—uses the surrounding seawater for cooling—one reason that officials say it consumes more than 20% less energy than an equivalent land-based hub and eases demand for fresh water.

HiCloud previously deployed a commercial underwater data center off Hainan in 2023, but this is the first tied to offshore wind. Gizmodo notes that the data center cost about $226 million to build. The move comes as data centers, described as AI's physical backbone, face criticism over their heavy electricity and water use. A UN-linked institute this week warned that the centers' global water footprint could hit 2.5 trillion gallons by 2030, per the Guardian.

Microsoft tested similar tech off of Scotland in 2018, then slowed work, while China has accelerated its efforts, helped by policy support and booming AI demand. Marine biologists say potential impacts, such as warmer local waters, appear limited but warrant ongoing monitoring. Scientists cited in a previous report by Wired say that "hot" structures like data centers submerged in the sea have the potential to spur toxic algae blooms and hurt local wildlife.

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