THE TRUTH ABOUT AI DATA CENTERS EVERYONE'S FREAKED OUT

Everyone's freaked out about data centers. About data centers. How much water they're using? What land they're taking? And how much money they cost to build? OpenAI spending over $500 billion on theirs. Over half a trillion dollars to build. Nvidia in talks with OpenAI to guarantee $250 billion financing for data center. Project would be one of the largest AI computing hubs and involve power controlled by the U.S. government. By Anissa Gardizy, Amrith Ramkum, Corrie Driebusch. July 26, 2026 at 7:19 p.m. ET. Groundbreaking for the Ohio data-center complex in March. BRIAN KAISER/BLOOMBER. wsj.com. Let me explain. First, they need some land. How do you build a $500 billion data center? Land in Southern Ohio. There's an old uranium enrichment site, already owned by the federal government. We don't know terms yet, but it's 3,700 acres. Which costs out between one and three hundred million. Next is power. America's grid dates back to the 1970s. And there's not enough spare power to feed a 10 gigawatt data center. So they're building the world's second largest gas-fired power plant on site, aiming for 9.2 gigawatts. For that, they need gas turbines, which already have a five-year wait time, plus new transmission lines to connect to the data center. All this, $37 billion. But you can't just plug a power plant into a data center. The voltage gets stepped down through substations. And power goes out now and then. So you need backup diesel generators. Another three-year wait list. So they need fuel cells to bridge the gap. One ceramic fuel cell gives you about 25 watts. A stack of them powers a home. Stacks combined into 300 kilowatt blocks, and companies like Bloom Energy sell arrays of blocks, giving you megawatts in months. All another $20 billion. Now we actually have to build the thing. And thousands of construction workers, plus concrete and steel to create what's effectively a hurricane and tornado-proof box. A powered concrete shell that'll outlive all the technology and all of us. That's about $55 billion. Next, cooling. A huge source of controversy. The way it used to work was heat was pumped out of the servers into a cooling tower outside. Evaporation carried the heat away. Water was pumped through the servers. This is so wasteful. And a lot of data centers still work like this. More than 25 billion gallons each year. If they used it here, it would require as much water as the city of San Francisco. The new system is more like a car radiator. Where the water gets filled once and that's it. A cooling plate gets attached directly to each chip, which is then heat exchanger. Racks of chips now face each other with a cold alley in between, going out the pipes. Pipes pull the heat off the chips, carry that hot water past fans, cool it down, and send cold water back through the alley between the racks. Instead of the whole city of San Francisco, you only use as much water as a city block. The new closed loop system costs about $35 billion. Next up, the network. There's millions of chips in here, but they only work if they talk to each other inside the racks. Chips communicate through Nvidia's NVLink, two miles of copper cabling in each rack. The language they speak is CUDA, Nvidia's coding language. To then link the racks together into one coherent machine, you need fiber optic cables and switches, carrying data around at the speed of light. All in $30 billion. Last but not least, the chips. Each unit in a rack consists of a high bandwidth memory system with a logic chip stapled onto it. We explain this in other videos. Now do that 4.5 million times. And you get $350 billion. That plus a networking spend is going straight to Nvidia. And this project cost $527 billion. But more importantly, you now understand why Nvidia is willing to backstop $250 billion of this project's debt. They're guaranteeing themselves almost $400 billion of revenue by backstopping the loans that pay for it. Sounds like circular financing. We'll cover that next.