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A setback for plans to build a massive data centre complex near Olds, Alta. after the Alberta Utilities Commission denied an application to build a huge natural gas power plant .
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The Alberta Utilities Commission has denied an application to build a natural gas plant that would have powered a massive data centre complex in the small agricultural town of Olds, Alta.
Synapse Real Estate Corp. had proposed a 10-building campus with 1.4 gigawatts of power generation — about enough to power the city of Edmonton.
The plan also included 1.8 gigawatts of emergency and backup diesel generation.
But the commission, in a decision published Monday, said the site won’t work.
“The project is too close to the surrounding community, and Synapse failed to demonstrate any compelling justification for selecting that location,” the commission said.
“The site is simply not suitable for the proposed development.”
Many residents in the town of 10,000 voiced fervent opposition to the project within town limits.
Story continues below advertisementThey are concerned about noise, pollution, home values, safety and strain on local health care and emergency services.
Olds is 80 kilometres north of Calgary.
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The commission noted strong local interest. It said it had received applications from about 1,500 parties wanting to participate in hearings. It granted standing to more than 900.
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Get expert insights, Q&A on markets, housing, inflation, and personal finance information delivered to you every Saturday. By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy.Typical proceedings would attract a few hundred applicants.
The Alberta government has been courting big tech companies to set up shop in the province but is prioritizing projects that provide their own power for their data centres in order to not overburden the grid.
Data centres house computer servers and other hardware needed to power many facets of technology.
Story continues below advertisementWith the advent of artificial intelligence and the enormous processing power needed to train and run large language models, questions are being raised over whether they are worth the environmental impact and electricity demand.
The commission is tasked with determining whether the accompanying power infrastructure is in the public interest, but decisions around zoning and land use for data centres fall to municipalities.
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The town government has seen data centre development as an opportunity for increased tax revenue and local employment.
It said it had not received a development permit application from Synapse.
“Throughout this process, the town has maintained that development must meet the required safety, environmental and regulatory standards before it can proceed,” the town said on its website Monday.
“The AUC’s review is an important part of those checks and balances, and we respect its decision.”
In a statement emailed to Global News, Synapse confirmed “the project in Olds will not proceed as proposed,” but added “our commitment to Alberta remains steadfast.”
Describing what it called the “extraordinary potential for the data centre industry in Alberta,” the company said it will consider future opportunities in the province as we assess the best path forward,” and added that “any next steps will be guided by continued engagement with regulators, municipalities, community members and the provincial government.”
Story continues below advertisementSynapse has 30 days to appeal the Alberta Utilities Commission’s decision.
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The proposed development of data centres has stoked considerable consternation in parts of Alberta.
Meta Platforms Inc., the tech titan behind Facebook and Instagram, announced plans last month to build a $13-billion data centre complex in Sturgeon County, north of Edmonton.
It would be linked up to an adjacent power plant to be built by Pembina Pipeline Corp., Morgan Stanley Infrastructure Partners and Kineticor Asset Management.
Hundreds of people gathered outside of Sturgeon County’s office earlier this month to protest the Meta data centre plant.
Last month, a rural municipality bordering Calgary voted to pause new data centre proposals while the Rocky View County government works to pin down the rules that apply to such projects.
Story continues below advertisementThe provincial government has announced it is holding a series of town halls in the coming weeks to gauge residents’ views on data centre development.
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