While many Americans resist, China embraces AI data center boom

In the remote Chinese province of Inner Mongolia, Hereford cows roam through corn fields near the outskirts of Ulanqab, while shiny new transmission towers and wind turbines dot the landscape. This energy infrastructure will soon power multi-story data centers being constructed on farmland as part of China's sprawling AI data center construction boom. The construction site spans an area comparable to a small American city and represents the biggest, fastest-growing infrastructure project currently underway in China.

From farmland to AI hub

This region, once famous for growing potatoes, is rapidly transforming into an AI hub as Chinese officials aim to surpass the United States as the global leader in artificial intelligence. Baletu, a 72-year-old farmer who has lived here for over 40 years, welcomes the changes. "It doesn't affect my farmland, not at all," he told CBS News. "It's good for the area."

Energy advantages and cost efficiency

Ulanqab has been selected for its cheap, abundant energy mix of fossil fuels, wind, and solar power. The region's consistently windy climate and year-round cold temperatures help reduce cooling costs, while land and labor remain more affordable than in other parts of China. Experts cited by the Financial Times note that Chinese data centers are built at approximately one-fifth of the costs incurred in the United States, primarily due to lower land and labor expenses.

The construction effort has mobilized as many as 30,000 workers brought in from across China, providing welcome employment opportunities amid the country's economic downturn and high youth unemployment. "Development is the best thing, especially when it provides job opportunities for many young people," said a local businesswoman operating a food stall near the construction site.

Contrasting approaches to development

While data centers in the United States face significant community opposition—potentially emboldened by Democrats' strong midterm election performance—Chinese developers encounter few hurdles. China's government tightly controls messaging and generally prohibits protests, with a United Nations survey finding that 80% of Chinese people support data center construction. At least two-thirds of Chinese citizens use AI in their daily lives, demonstrating widespread acceptance of the technology.

"There is no opposition to data centers in China. It's never heard of, whereas in the U.S., it has become a huge movement against data center building in neighborhoods," said Henry Wang, founder and president of the Center For China and Globalization. Under President Xi Jinping, AI development has become a national strategic priority for China, with major tech companies like Huawei, Alibaba, and Byte Dance all active in the Inner Mongolia region.

The power advantage in AI race

Although Chinese AI companies are believed to be about six months behind their US counterparts—largely due to restrictions on high-end microchip sales—the gap is narrowing. China possesses more than double the power generation capacity of the United States, leading some experts to believe that access to power, rather than chips, may ultimately determine global AI dominance.

"Chips may not become the latest diving criteria," Wang explained. It may be that power is the bottleneck, and whoever goes through that first gets the advantage. And right now, China has the edge. With construction continuing across multiple sites in Inner Mongolia, China is positioning itself to leverage its energy resources in the increasingly competitive global AI landscape.