Microsoft invests 6.2 billion dollars in Norway's AI sector, aiming for 100% renewable energy-powered computing operations.
Microsoft has made a significant move towards sustainable AI infrastructure with a five-year, $6.2 billion deal in Northern Norway. The partnership involves UK-based company Nscale and Norwegian industrial investment company Aker, who will help build AI computing capacity powered entirely by renewable energy.
The choice of location for this project is strategic. Norway's clean electricity and cool climate offer natural advantages, reducing the need for mechanical cooling. This move towards renewable energy will also help reduce greenhouse gas emissions, replacing fossil fuels with hydropower.
This project marks a significant step for Microsoft, providing a strong base in Europe to serve governments, businesses, and research institutions. The scale of the deal is noteworthy, especially considering the growing demand for AI infrastructure. Competitors like Amazon and Google are also making big clean energy deals, but Microsoft's project stands out in this regard.
The global market for AI infrastructure is projected to grow more than 30% per year and could be worth hundreds of billions of dollars by 2030. For renewable energy producers, deals like this provide financial stability and help scale up clean power projects.
However, the project is not without its challenges. Global shortages in chips or materials, local regulations and permits, and the carbon footprint of AI hardware are all potential obstacles.
Microsoft's Norway project ties renewable energy directly to AI growth in Europe. The project aligns with Microsoft's 2030 climate goals, which include becoming carbon negative, water positive, and zero waste, as well as protecting more land than the company uses.
Microsoft has also recently agreed to a $19.4 billion deal with Nebius over five years to supply massive GPU-powered AI infrastructure. The Norway project is expected to provide power for about 100,000 NVIDIA GPUs by the end of 2026, potentially setting a benchmark for other tech companies in building AI capacity on renewable energy.
Data centers already account for around 2% of global electricity use, and this share is climbing due to AI demand. Between 2020 and 2023, Microsoft's total emissions rose by about 30%, largely due to the rapid growth of cloud services and AI workloads. Scope 3 emissions from suppliers and product use now make up more than 96% of the company's footprint.
The Norway project is part of Microsoft's goal to sign contracts for 19 gigawatts of renewable energy across 16 countries in 2024 alone. This ambitious plan underscores Microsoft's commitment to a sustainable future for AI technology. The deal is for five years and involves leasing AI computing from Nscale Global Holdings and Aker ASA. The project aims to deliver the power of about 100,000 NVIDIA GPUs by the end of 2026. This groundbreaking project could pave the way for a greener future in the AI industry.
